Stocks, Bonds, Bills and Inflation: Updates

In this summary of a forthcoming update of their book Stocks, Bonds, Bills, and Inflation, the authors present both annual index levels and total rates of return for common stocks, long-term government bonds, long-term corporate bonds. Treasury bills and the Consumer Price Index over the period 1926-78.

The authors also provide historical return figures for four component series — the riskless rate of interest, the equity risk premium, the bond default premium and the maturity premium between the return on long-term governments and Treasury bills.

Taken together, the five basic asset series and the four component series provide the investor with the necessary historical background for making judgments about future tradeoffs between risk and reward.