MMM affect on the market?

[Heckler]

Is there any way to disprove my theory that MMM "buy more VTSAX" mantra is driving this bull market that started around the time Pete A. (MMM himself) started blogging?

[Car Jack]

Anything we could do would be purely anecdotal.  Personally, I have over $2MM invested and don't own a dime of VTSAX.

[Le Barbu]

Definetly, and THAT is why this time it's different!

[maizefolk]

Well the S&P 500 is up ~83% since Pete's first blog post in April 2011 which is a CAGR of ~10.6%.
But the S&P 500 was up ~50% from January 2009 to April 2011 which is a CAGR of ~18.4%

So I'd say the bull market started before MMM did. But it is all a matter of hand waving at some point.

[ChpBstrd]

MMM has had 25 million views (per the latest post).

If these viewers altered their allocation of or saved an AVERAGE $50,000 during that time, it would be an economic move of $1.25 trillion dollars - definitely enough to move a market over six years. It would be an effect on par with corporate offshore accounts, tax cuts,

However, I bet that average is closer to $50 than $50k. Lookie-loos are a lot more common than cult converts. For every new millionaire who changed their consumerist life because of MMM there are 500 people who glanced, said "I couldn't do that!" and never returned.

Also, MMM gets the occasional media notice, but this blog isn't exactly a cultural phenomenon (yet). My friends are more interested in taking about their luxuries than their frugalities. Zero of the people I evangelize have ever heard of the cult.

It comes down to the old question "what if everyone became Mustachian"? I think the effect would be scarce investment opportunities, much lower GDP, and much higher quality of life. But that's not what we're seeing. The rise in economic inequality pretty much explains the gap between stock valuations and average family finances.

[Le Barbu]

MMM has had 25 million views (per the latest post).

If these viewers altered their allocation of or saved an AVERAGE $50,000 during that time, it would be an economic move of $1.25 trillion dollars - definitely enough to move a market over six years. It would be an effect on par with corporate offshore accounts, tax cuts,

However, I bet that average is closer to $50 than $50k. Lookie-loos are a lot more common than cult converts. For every new millionaire who changed their consumerist life because of MMM there are 500 people who glanced, said "I couldn't do that!" and never returned.

Also, MMM gets the occasional media notice, but this blog isn't exactly a cultural phenomenon (yet). My friends are more interested in taking about their luxuries than their frugalities. Zero of the people I evangelize have ever heard of the cult.

It comes down to the old question "what if everyone became Mustachian"? I think the effect would be scarce investment opportunities, much lower GDP, and much higher quality of life. But that's not what we're seeing. The rise in economic inequality pretty much explains the gap between stock valuations and average family finances.

Maybe, giving all of the credit to MMM is a bit of a stretch but...

Since 2008, personal finance blogs as a whole litteraly exploded

And even if I never met a mustachian in face to face yet, I hope they are for real

5 years ago, our family moved 200k$ from bonds to stock, stopped prepaying mortgage to max out every tax sheltered account, started a taxable account, increased savings from 38% to 43% and so on

It's almost 400k$ more in the stock market. 150k$ more into VTI and we are not even US citizens!

Meanwhile, people arround us just continued to increase wastefulness of $$ and crap, exponentialy!

[UnleashHell]

nothing to do with MMM. its all because i moved to florida in July 2012. It all ties into that.

that'll be 10% of your stash to be paid to me thank you..

[maizefolk]

Possibly also relevant to this discussion: If the bull market from 2011 to present was mustache driven, we might expect it to show up in a change in the personal savings rate of american households.



Savings rates are definitely higher than they were right before the housing crisis. But by 20th century standards, our savings rates today are still at the extreme low end of the spectrum.