From: beliavsky@aol.com
Newsgroups: misc.invest.financial-plan
Subject: expected long term stock and bond returns
Date: Mon, 28 Feb 2005 10:06:50 CST
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An article by Mark Whitehouse in the 2/28/2005 Wall Street Journal,
page C1, surveys economists and market strategists regarding long term
expected real (after-inflation) returns on stocks, government bonds,
and corporate bonds. Here are the forecasts. Sorry if the spacing below
is messed up.

                        Expected real returns
2/28/2004 WSJ		stocks	govt. bonds corporate bonds
	        mean	4.81	2.80	    3.33
	        min	4.00	1.80	    2.30
	        max	6.50	4.00	    5.00
Dudley	Goldman Sachs	5.00	2.00	    2.50
Siegel	Wharton	        6.00	1.80	    2.30
Rosenberg Merrill Lynch	4.00	3.00	    4.00
Harris	Lehman Brothers	4.00	3.50	    2.50
Shiller	Yale	        4.60	2.20	    2.70
LaVorgna Deutsche Bank	6.50	4.00	    5.00
Jain	Nomura	        4.50	3.50	    4.00
Lonski	Moody's	        4.00	2.00	    3.00
Malpass	Bear Stearns	5.50	3.50	    4.25
Glassman JP Morgan	4.00	2.50	    3.00

The expected stock returns are lower than 6.8% average from 1802-2004
and the Bush administration projection of 6.5%. The article explains
that expected future real stock returns can be decomposed into

real GDP growth + dividend yield + buyback yield,

citing 1.9% + 1.7% + 1.0% = 4.6% as plausible estimates for these
numbers.