Can the British pound fall any further?

At the time of writing sterling today had risen by 0.6% to be 1.5344 against the US dollar. Part of the contributor to this was a fall in UK unemployment of 33,000 for the 3 months to January 2010 putting unemployment at 2.45 million or 7.8% today. Now I don’t watch this indicator regularly however if you read into the figures a little deeper it doesn’t look all rosy to me.

Gold Priced in GBP – March 2010 Update

In absolute terms gold continues to reach new levels of expensiveness in GBP terms when looking back over historic average monthly data since 1979. However there has been a lot of inflation over this period and so as always I will look at the real (inflation) adjusted price of gold over this period which is my first chart today. The inflation dataset that I will use is the UK retail prices index (RPI).

Average UK interest rates for savers – March Update

My chart today shows that for those that are looking to save it isn’t getting any better out there. Average interest rates on cash savings are declining if you are prepared to lock your money up for any period of time and if you want instant access the average increase is a miserly 0.07%. Let’s analyse the data in more detail.

A History of Severe Real S&P 500 Stock Bear Markets – March Update

Looking at the first chart which shows the real (inflation adjusted) S&P 500 (or its predecessor) stock market I have identified three historic severe stock bear markets. These I am defining as stock markets where from the stock market reaching a new high, they then proceeded to lose in excess of 60% of their real (inflation adjusted) value. These are best demonstrated by the second chart which shows each of these stock bear markets and the fall in percentage terms from the peak. So briefly what were these bear markets (full details here).

US (S&P 500) Stock Market – March 2010 Update

To try and squeeze some more performance out of a retirement investing strategy that is heavily focused on buy & hold and asset allocation I am using a Cyclically Adjusted Price / Average 10 Year Earnings (PE10 or CAPE) ratio for the S&P 500 to value the US (specifically the S&P 500) stock market. The method used is that developed by Yale Professor Robert Shiller however I also incorporate earnings estimates up to the PE10 month of interest. Background information here.