Bull Markets Climb a Wall of Worry
August 27, 2018
I love the above phrase because it describes so well how most bull markets function. We are currently in a secular bull market, but the media, the average investor, and even some pundits are looking for a shoe to fall so they can call the end of this bull market run. Some are worried that the Fed’s actions will slow the economy and cause a recession, others look at the length of the economic expansion and say it’s simply a matter of time, and still others claim that the markets are overvalued. I’d argue that they are all wrong.
The last secular bull market we experienced in this country was from 1982 through 1999. 18 years of generally up markets. Yet during this time, you would have seen, experienced, or felt plenty of reasons not to invest.
According to Robert Shiller and Yahoo Finance, had you invested $1 million on January 1, 1982, it would have been worth $21,758,188.92 at the end of 1999.
Secular bull markets are long-term positive-trending markets. As you can see from the chart to the right, investing during a secular bull market doesn’t mean that the market goes straight up, or that there aren’t recessions along the way. Just look at 1982 through 1999 secular bull market. We had the 1987 stock market crash, the 1990 recession (and negative market), and 1994. Yet the S&P 500 still provided a 2,076% return on your money.
Currently, there is a “wall of worry” that is affecting how people are investing their money.
I don’t want to be dismissive of anyone’s feelings or concerns. Instead, let’s talk about what is really going on.
Polaris Greystone remains bullish on the markets and we expect to see a strong finish to the year. What should you do if you are sitting in too much cash? Sit down with your Polaris Greystone Wealth Advisor. They will be able to guide you as to the best way of getting your money working harder for you.
As always, I welcome your questions and comments, and I encourage you to meet with your Polaris Greystone wealth advisor to keep up to date with our service offering.
Jeffrey J. Powell
Managing Partner, Chief Investment Officer
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