Charting A Previous Era, from Kim Zussman
The attached chart compares log(DJIA monthly close) for the periods 1942-1982 and 1982-2009, transposed such that 1942 and 1982 start at the same point in time. "Relative date" axis is in months at the same scale for both periods. The "range-bound" period (and what a range it was) in the older series starts in 1965 and ends in 1982. Why did it end ? Presumably de-torporization via larger than life Paul Volcker, Ronald Reagan, Bill Gates, and Michael Milken.
Why 1942? It was a good starting point, as it was when Bogart made Casablanca. The era 1942-1982 could be called the era before financial engineering ("I am shocked to learn that there is gambling going on here, gambling on the value of mortgage backed securities").
