With the inauguration of a new President, it seems appropriate to identify a new economic and market baseline as a fresh starting point for the incoming administration.
First, the conditions President Trump is inheriting then we’ll see how those conditions stack up to his five immediate predecessors’.
All data as of 12/31 of year prior to inauguration unless indicated otherwise.
There are many observations to be made, but I’ll focus on a few I find particularly interesting.
Continue reading “A New President, A New Baseline”
- The S&P 500 is currently in its second longest bull market since WWII in terms of both magnitude and duration.
- Various historically-reliable measures of market valuation are indicating returns in U.S. stocks over the next decade may be about half their historical averages or less.
- It’s reasonable to expect at least a 40%-50% decline in U.S. stocks during the “bear” phase of this cycle. The bear phase will complete the current market cycle that began in March of 2009 (each market cycle begins with a bull phase and ends with a bear phase). The challenge, of course, is not knowing when the bull phase will end as we’ll only know well after it’s topped out.
Continue reading “The Second Longest Bull Market Since WWII…How Does It End?”
Investors tend to underestimate the risk of loss especially at the tail end of a bull market that’s been raging for almost eight years. So let’s take a look history for some proper perspective.
Continue reading “Risk and Return: A Historical Perspective”
Did you know that you and a friend could put the exact same amount of money away throughout your careers, earn the exact same average annual return on your portfolio with the exact same volatility but end up with completely disparate portfolio values?
Continue reading “You Only Get One Shot”
As hard as it might be to believe, income tax rates in this country have at times exceeded 90%. And, perhaps even more surprisingly, the country was relatively prosperous during those same periods. Not so surprisingly, the high tax rates are often attributed with the widespread national prosperity. But we know correlation does not equal causation. Check out the tweet below for just one such recent example.
Continue reading “Confiscation Leads to Prosperity?”