Over 20 years that’s possible (and I think it’s in fact true), but the paper I cite in the post gives some data which makes it unlikely that the whole past record is outperformance. It’s hard to square 150 years of over 6% mean annual equity premium with 20% annual standard deviation with the idea that the true stock return is actually the same as the return on T-bills. The “true” premium might be lower than 6% but not by too much, and we’re still left with more or less the same puzzle even if we assume that.
Over 20 years that’s possible (and I think it’s in fact true), but the paper I cite in the post gives some data which makes it unlikely that the whole past record is outperformance. It’s hard to square 150 years of over 6% mean annual equity premium with 20% annual standard deviation with the idea that the true stock return is actually the same as the return on T-bills. The “true” premium might be lower than 6% but not by too much, and we’re still left with more or less the same puzzle even if we assume that.