Paper hats and noisemakers all ‘round: the Dow Jones Industrial Average closed above its all-time high on Tuesday. Yes, we hear you grumblers in the back. It’s an index of only 30 big-cap US companies, with an irrational price-based weighting scheme, and is not adjusted for inflation or dividends – hardly representative of equity returns generally. Well, if you dislike confetti, suit yourself. The rest of us can take this occasion for reflection, as we do on other arbitrary occasions, like birthdays (or are you grouchy about those, too?).

The 30 companies that make up the Dow generated an aggregate of $2.9tn in revenues over the past year, according to data from Capital IQ, which is more than a fifth higher than trailing sales for those same companies in October of 2007, when the old peak was reached – and operating margins are almost equally high. Sounds good? Well, that comes out to a compound annual revenue growth rate of 3.6 per cent – and that’s in nominal terms. If you have the feeling the economy has been treading water for the past half decade, the Dow says you are right.

Yet there is some good news, at least for investors who are preparing to jump on the stock bandwagon as it heads into frontier territory. The stocks in the Dow look, in aggregate, cheaper than they did at the 2007 top. Excluding the financials in the index, their ratio of enterprise value to earnings before interest, tax, depreciation and amortisation is roughly nine, as against 11 at the last peak. Stock prices are lower relative to book value, too – and the companies have de-levered some. But buyers are paying less for much less growth: over the past year, the Dow companies have grown sales, on average, about 2 per cent. Back in late 2007 they were humming along at 11 per cent. That is, admittedly, rather dreary. But this hat looks sort of stupid anyway.