Enjoying the ride?

in much need of a substantial(bear) correction

Why? Over the history of the market, the context has changed enormously and so have the patterns. Merely thinking in terms of patterns and percentages without context is missing the most important information. The 2000 thing is a perfect example … when before has there been such a context? I suppose one might make comparisons to some of the spectacular busts in the distant pass, but those tended to be focused on something specific that bubbled, not a large segment of the market. What is the historical precedent for the prolonged period of slow growth in the economy following a very deep bust that we have experienced? And, if there is any such parallel, how different then were the actions of the Fed and other big players?

Pretense at predictability is a great delusion.


statistically speaking, over the last 100 years, we have seen an average of two bear markets (20%+ corrections) every decade, with one of those corrections exceeding 30%.
that had not happened in 8 years. i am counting from the bottom of march 2009.
Why do that? If you want to refer to a 10 year fact why not go back 2 years and call it a round 10 year decade and there you have one of your 20% correction events.


Another great way to see the difference between now and the tech wreck of 2000. It clearly shows we have a long way to go before we hit that irrational exuberance.



Actually that’s a very good way of looking at it. Bubbles are often technically defined as occurring when rising beyond 2 standard deviations.

Clearly this is not a bubble but there could be a valuation stretch if you are looking at average P/E.

1 Like

statistically speaking, over the last 100 years, we have seen an average of two bear markets (20%+ corrections) every decade, with one of those corrections exceeding 30%.

“Statistically speaking” is just trying to put a name on random facts and calling them statistic facts.

Let’s take the following situation—There are 10 young women in a classroom. One of the women is pregnant (random fact)-- “Statistically speaking” each woman in that classroom is 10% pregnant (Statistic fact–but complete nonsense)

Some people spend their whole life preparing for the next correction and miss out on the more frequent upsides that have created massive wealth for some.

The Dow is now at 20,000–It got there in spite of the 20% and 30% corrections over the past 100 years that crop up randomly.



Rather than get too hung up on stats, I do think that the market responds to future anticipated macroeconomic occurrences and excluding the black swan type shock, at least some of these are anticipatory to the market trend.

For example, we have had unprecedented low interest rates for a very long time, essentially getting money into banks, low loans for businesses, lower mortgage rates for buyers of goods, etc. That is a great environment for the stock market with both businesses and consumers being more flush with cash than otherwise they might be.

Now we see the FED beginning to tighten and IMO, that would have been a major deterrent to the market’s uptrend…were it not for President Trump’s corporate and personal tax proposals. His pro-business stance has been the the “future anticipated” event that the market is trading on IMO.

I think we should all be very interested in what he is proposing and the likelihood it gets passed in Congress…since IMO, this is countering the negatives of the FED’s interest rate hikes.

We cannot know what Black Swan event is coming, but this Trump/FED ying and yang seems pretty evident to me, so if our President has difficulty getting this pro-business agenda through, I will predict a substantial market decline.

Most on this board haven’t lived through a true bear market…they can be very disconcerting financially and emotionally. In the 2000 Dotcom splash…there were many warning signs, mini-hits, etc. before the biggest hits. We may have the opportunity to see this playing out with the pursuit of pro-business government policies so this legislative activity all bares watching closely IMO.


statistically speaking

I know you are not talking about bull market, there are folks who define bull market is from the beginning of new high, if you look at that way, don’t you think it is too early for a bear market?

don’t you think it is too early for a bear market?

No. 8 years without a 20% corrections is a very long time compared to historical records. I don’t subscribe to the idea that ‘this time it is different’. History tends to repeat itself.

That said, this is just an academic discussion. I don’t time the market and am 100% invested in stocks at all time.


1 Like