United States
What one dollar became
Invested in 1891 and held to 2020, after inflation. Equities ended at 5073.2x, housing at 1806.1x, bonds at 12.3x and bills at 5.7x. The scale is logarithmic, because over a century of compounding a linear axis would flatten three of these four lines into the floor. The dashed line is 1.0: below it, the asset lost purchasing power.
Source: Jorda-Schularick-Taylor Macrohistory Database, Release 6 (Jorda, Knoll, Kuvshinov, Schularick & Taylor) Compounded over the 130 years in which all four assets were reported. Shaded bars are JST's own banking-crisis years. Methodology
Compound annual real return
| Asset | Real return | Excluding the wars | Volatility | Observations | Span |
|---|---|---|---|---|---|
| Equities | 6.82% | 7.18% | 18.23 | 149 | 1872-2020 |
| Housing | 5.94% | 6.18% | 7.90 | 130 | 1891-2020 |
| Bonds | 2.50% | 2.92% | 8.93 | 150 | 1871-2020 |
| Bills | 2.06% | 2.54% | 4.58 | 150 | 1871-2020 |
Source: Jorda-Schularick-Taylor Macrohistory Database, Release 6 (Jorda, Knoll, Kuvshinov, Schularick & Taylor) Nominal returns deflated by JST's own consumer price index. No observation for this country is flagged as interpolated. Methodology
An independent check on the safe rate
Two scholars, two sources, one quantity. The bill rate computed here, deflated by JST's price index, set against Schmelzing's independently constructed real safe rate for the same country-years. They are built from different underlying instruments and are not expected to match to the decimal; where they track each other, both are more credible. This check exists for eight countries only, because Schmelzing's country series covers no others, and it is shown where it exists rather than promised everywhere.
| Period | JST real bill rate | Schmelzing real safe rate |
|---|---|---|
| 1870-191343 yr | 5.01% | 3.18% |
| 1919-193820 yr | 4.04% | 4.27% |
| 1946-197934 yr | 0.02% | 0.38% |
| 1980-201839 yr | 1.74% | 2.92% |
Source: Jorda-Schularick-Taylor Macrohistory Database, Release 6 (Jorda, Knoll, Kuvshinov, Schularick & Taylor) | Schmelzing (2020), Bank of England Staff Working Paper 845 Arithmetic mean of the annual real rate within each period, over the years both sources report. Periods split at the wars. Methodology
Coverage for United States
Equities 149 years, housing 130, bonds 150, bills 151. JST flags 6 banking crisis years for this country, marked on the chart. An average taken over a short series is a weaker statistic than one taken over a long series, and the counts are here so you can tell which you are reading.