Click on the picture to enlarge.
The Dow Jones Industrial Average has risen from 12,474.52 on Jan 3 2007, to 13,424.88 today, September 13, 2007. That is a nominal gain of 7.62%. However, this gain is only valid if you live in the US, and even so, if you don't take inflation into consideration.
If we take into consideration the Canadian dollar exchange rate, for example, the Canadian investor that bought the index in January has lost 3.81% this year. This is because the CAD has appreciated 11.9% this year versus its American counterpart.
European investors would have done better with a gain of 2.86%. Investors tied to the poor Brazilian currency, which used to be the joke of the world's currencies, would have lost 3.42%! The Real has appreciated 11.4% this year alone (and quite a bit more last year).
Finally, measured against gold, the DJIA fairs the worst. In January 2007, the DJIA would have bought 200.3 shares of the gold ETF GLD. Today, the DJIA only buys 191.6 shares. That is a drop of 4.4%.
Has the DJIA really risen this year? How many liters of milk would it have bought back in January? How many cobs of corn? How many liters of gasoline?