The crossover time for the UK is just over 20 years with a 9 per cent real rate of return
. It is 36 years with a 3 per cent rate of return and with 2.4 per cent aggregate labour productivity growth.
(6) Empirically, r>g is satisfied if we measure r by the long-run average real rate of return
on equity (not the safe real interest rate) and g by the long-run average growth rate of output or consumption.
In addition, using 2%-3% as real rate of return
is more appropriate, particularly because the estimates extend over a much longer period than most types of lending, and they are more consistent with recent projections (CBO 2015).
Rit real rate of return
on shares of i-th company achieved on day t in case of information,
Savers, even with interest rates at historically low levels, can find a real rate of return
at the moment without too much effort and investors are often reaping significant real returns.
I think your friend is referring to "a negative real rate of return
The unitized risk values for the real rate of return
for the DJIA Index are indicated on the basis of the data presented in Table 1 and Figure 2.
The real rate of return
(return minus consumer price inflation) was negative (see Price Trends).
Of the remaining 73, those who fared the best were, once again, entrepreneurs and investors, with an annual real rate of return
of 5.6 percent over the last 26 years, the Tax Foundation says.
However, your real rate of return
would have been negative.
Getting a positive real rate of return
is effectively impossible for the proverbial widows and orphans.
* Fixed-income securities, such as longterm bonds, that are often considered safe investments, may have a negative real rate of return