Ryan Leggio: Let's talk a little bit about where we currently are in the market. The S&P as we're talking today is right around 1050. The dividend yield of the S&P is slightly under 2%. The 10-year treasury is hovering right around 3% and the 30-year treasury is hovering right around 4%. And given these market conditions, can you let readers know what specifically your outlook is for the S&P generally over the next ten years now?
John Hussman: Right. We have a standard calculation that we frequently update on the website, where we look at the implied long-term return in stocks and that's basically driven by applying a reasonable range of multiples to normalized earnings, and we've talked before about this.
Normalized earnings historically have grown about the same rate as nominal GDP, if you look peak-to-peak across economic cycles. It's a little over 6% annually for the S&P 500 and you can take that back to the 50s or 40s or even 30s.
So using that basic approach, we are looking at a long-term 10-year return for the S&P 500 and total return including dividends approaching 7% right now.
Leggio: Great. So 7% not as great as the 9% or 10% that investors usually expect, but I also wanted to touch then on for comparison purposes, your expectations in March 2009 was approaching 10% or 11% using the same methodology, is that correct?
Hussman: Yeah. At the very bottom, we even got passed 11%. We got a little closer to 12%, but it was extremely brief. At major secular lows like we've seen in say '74 or 1982 or a little after 1950, we saw that numbers go as high as 15.5 or 16 for 10-year expected returns. So we didn't get to what one would consider generational undervaluation, but stocks were briefly undervalued at the 2009 level certainly.