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GFD Blog

DJIA to hit 40,000 by 2030?

On May 26, 1896, Charles Dow, an editor at the Wall Street Journal and co-founder of Dow Jones & Company, created a new stock market index and named it the Dow Jones Industrial Average. Never did he dream of it hitting 20,000 when it opened at 32. By 1905, 10 years after it had been created, the DJIA had doubled to 65.

Solving the Exchange Bias Problem in United Kingdom Stocks

One of the goals of the US Stocks Database and the UK Stocks Database is to eliminate the survivorship bias and the exchange bias that all other stock databases suffer from. Survivorship bias occurs when only stocks currently listed are included in a database and delisted stocks are excluded. Exchange bias occurs when historical data for stocks that were previously listed on another exchange or traded over-the-counter are excluded, providing an incomplete picture of the history of the company’s stock price.

This can also create a sector bias. If a sector tends to have stocks listed o ...

Seven Centuries of Real Estate Prices

Global Financial Data has put together a data series covering seven centuries of real estate prices. The series covers real estate costs in Great Britain from 1290 to the current day.

How did we do this? Unfortunately, there was no Ye Olde Zillow Real Estate Co. that had stayed in business for seven centuries and allowed us to analyze their records, but instead we spliced together several long-term series to create this index. The data from 1290 to 1894 is actually based upon the rental costs of housing rather than actual housing prices since rental data was the only information th ...

Benjamin Harrison and the Terrible Tariff

Donald Trump was elected president promising to use protectionist measures, if necessary, to bring jobs back to America. Economists warn that raising tariffs reduces trade and hurts the economy. The Smoot-Hawley Act of 1930 is blamed for intensifying the Great Depression, and the lesser-known McKinley Tariff of 1890 provides an instructive lesson on how protectionist policies can impact the stock market and politics.

In 1888, the protectionist Republican Benjamin Harrison defeated the pro-trade Democrat Grover Cleveland. Cleveland won the popular vote, but Harrison won the electoral ...

The Future of Energy Prices: Lessons from 750 Years of History

Today, the future of energy prices is as uncertain as ever. Whereas in the 1970s, there was a fear that the supply of oil could decline dramatically, causing future oil prices to rise, fracking and other technological innovations have increased oil reserves to levels never before seen in history. At the same time, natural gas is becoming a clean substitute for petroleum, and because of concerns over global warming, solar power and battery technology are improving dramatically as attempts to end the economy’s dependence on carbon-based energy increase. Although coal is one of the dirtiest of ...

2017: Let the Bull Markets Continue

In our annual review of global stock markets, we noticed that a relatively large number of countries put in what could be a bear market bottom in 2016. If this is true, investors should expect that global markets will continue a bull market run in 2017 rather than forming a top that leads to a bear market.

Global Financial Data has data on bull and bear markets on 100 countries beginning in 1693. With this data, we have been able to track bull and bear markets during the past three centuries. We define a bear market as a decline of 20% or more in a country’s primary s ...

Global Financial Data Introduces Proprietary Commodity Indices Covering 1000 Years

Global Financial Data has introduced commodity indices which have the longest histories available anywhere as part of its family of GFD Indices. These commodity indices begin in the year 1000 and are current through 2016. The data are monthly and are updated on an ongoing basis.

The GFD Commodity Indices include a composite index, three commodity indices and eight commodity sub-indices. The Composite Index is broken down into three categories, energy, agriculturals and industrials. There are no sub-indices for energy, but there are five sub-indices for agriculturals (beverages, soft f ...

GFD Changes Its Tickers for S&P Sector Indices

Standard and Poor’s and MSCI recently revised their GICS sector indices, introducing Real Estate as a separate sector, removing it as an industry within Finance. S&P/MSCI also revised several of its sub-indices, both adding and subtracting several of them. The GICS Codes now include 11 Sectors, 24 Industry Groups, 68 Industries and 157 Sub-Industries. Because of these changes, GFD has decided to reorganize and simplify the tickers for its S&P Sector Indices.

Until now, the S&P Sector index tickers used abbreviations to name a particular sector. For example, RAIL was used for railroa ...

Can Saudi Arabia Save Itself?

Fear is powerful. Especially when it comes to the economic forces in the world and tied to our quality of life. This basic concept is pertinent to not only those in first world countries, but maybe even more so to people in developing nations. When the crash of 2008 happened on Wall Street, people reacted with fear. Fear of the crash happening again, and that sentiment drove politicians to implement changes so that they could try to contain the next market downturn.

Developing nations are no different. Their economies fluctuate through peaks and lows, and their citizenry and political ...

Cubanomics: An Interesting Economy to Visit, but Even Bernie Sanders Wouldn’t Want to Live There

I visited Cuba a few weeks before Castro passed away, and my visit to Cuba not only provided me with the opportunity to see a country frozen in time with American cars from the 1950s acting as taxis and a vision of what a country without any multinationals would look like, but it also enabled me to understand exactly how a socialist economy worked, or as is often the case, didn’t work.

Cubanomics at the Airport

Before you even leave the Havana International Airport, and perhaps without even realizing it, you are immediately immersed in Cubanomics, the upside-down Alice-in-Wonde ...