On a market top?

What is the historical precedent for the prolonged period of slow growth in the economy following a very deep bust that we have experienced?

To agree with the above sentiment from tamhas: There has been zero euphoria up to now. The market has been climbing a wall of worry, with people predicting that the market was about to crash right from 2010 when they were talking about a double-dip recession coming. People were touting all kinds of market indicators in 2011, 2012, 2013, 2014, etc as well, to show that the market was over-extended, that the low interest rates and stimulation of the economy would produce inflation, wage inflation, a bubble, a crash, and all the rest. They were totally wrong. Instead it’s been a slow, gradual, orderly rise, with a slow decrease in unemployment, slow but steady growth of GNP, no inflation, and a slow but steady increase in the stock market. With a few normal corrections along the way. Remember Feb 2015! By an ironic coincidence, all these technical analysis people appeared on our board from Feb 9 to Feb 11, screaming that the end of the world was coming, we should sell everything and go into cash, and they had indices to prove it. What was ironic was that they hit the exact bottom! Feb 11th! It was all up from there. The same thing in November 2008, when an analyst was asked what positions he’d be in he said “Cash, and the fetal position!” He hit the bottom too. You’ll know when you are at a top too, when it’s the opposite: when everyone is saying buy, buy, buy, and when your taxi driver or barber is touting a stock to you or asking you for a tip. It’s hard to see this as a top when everyone is worried that the market rise has gone on too long, and when the markets are rising at very normal rates or are semi-stagnant.



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Thank you for your wonderful historical analysis. Predicting markets accurately has always been an exercise in futility.

Focus instead on your individual stock holdings. For the long term , history has shown stock investing to be the best investment for the little guys. That has proven true for me the past 40 years.

My thanks to old heroes like Peter Lynch and Louis Rukeyser.

Keep the faith and relax and enjoy your lives and family.

La vita y bella!


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