Bull market ended in March.
When do you think this bull market is going to end?
- Thread starter Mpas
- Start date
Years ago I joked to a friend that the bull market would only end once John Hussman closes his fund... and to date he's still hanging on.
In all seriousness, these are the factors you have in play:
1. Everyone and his brother is just waiting for this historic bull run to end so they can buy on the cheap, and justify a decade of under-performance. Everyone is looking in the rear view mirror at historical cycle durations, yield curve inversion, etc. etc. and thus the almost universal expectation is that a recession (+bear market) will incept in the next 2 years at most. Is there anyone in the biz who thinks the U.S. market can grind out 5%+/yr through, say, Jan 2026?
2. CBs are keeping risk-free rates in the basement with no sign of an inflationary breakout. Yet at least until very recently, the universal belief was that we were much closer to the "bottom" than to the "top" of the interest rate cycle with meaningfully higher rates to come in the near future. What happens if we are actually at the top of the rate cycle, and interest rates never go higher than they are today through, say, 2050?
3. There's lots of talk thrown around about the "everything bubble", prices distorted by free money, imbalances building up for a thundering crash and so forth, but nobody can point to a specific clear speculative bubble with systemic risk implications.
4. Many automatic and structural processes keep up a steady flow of price-insensitive money into world asset prices, including: stock buybacks, 401(k)s and other forms of automatic passive "deduct from your paycheck" investment, migration from active managers to robo-advisers and passive vehicles, widespread adoption of sovereign-wealth funds by resource-producing countries, and the constantly increasing share of income and wealth controlled by the top 1% who, year after year, sock away their entire surplus in pro-managed family offices.
The result of all this is what we've seen for years, which is that growth keeps chugging along in a narrow slow range (and it's going to slow down even further now that we have full employment) while equity prices keep on marching higher, punctuated by occasional washout moves to flush weak-hand trend followers, poorly-thought-out quant strategies, and other pockets of crowded positioning. Then the automatic flows do their thing and the market is right back up at ATHs a few weeks or months later.
To really change this situation you need one or more of: serious political turmoil (like WW3, or a shooting civil war in the USA), a breakout of high inflation forcing the Fed to hike rates dramatically, or an unstable speculative bubble on the order of 2000 or 2008. The 1982-2000 secular bull ran for 18 years before the tech bubble and crash broke its momentum, this one can easily go longer.
In all seriousness, these are the factors you have in play:
1. Everyone and his brother is just waiting for this historic bull run to end so they can buy on the cheap, and justify a decade of under-performance. Everyone is looking in the rear view mirror at historical cycle durations, yield curve inversion, etc. etc. and thus the almost universal expectation is that a recession (+bear market) will incept in the next 2 years at most. Is there anyone in the biz who thinks the U.S. market can grind out 5%+/yr through, say, Jan 2026?
2. CBs are keeping risk-free rates in the basement with no sign of an inflationary breakout. Yet at least until very recently, the universal belief was that we were much closer to the "bottom" than to the "top" of the interest rate cycle with meaningfully higher rates to come in the near future. What happens if we are actually at the top of the rate cycle, and interest rates never go higher than they are today through, say, 2050?
3. There's lots of talk thrown around about the "everything bubble", prices distorted by free money, imbalances building up for a thundering crash and so forth, but nobody can point to a specific clear speculative bubble with systemic risk implications.
4. Many automatic and structural processes keep up a steady flow of price-insensitive money into world asset prices, including: stock buybacks, 401(k)s and other forms of automatic passive "deduct from your paycheck" investment, migration from active managers to robo-advisers and passive vehicles, widespread adoption of sovereign-wealth funds by resource-producing countries, and the constantly increasing share of income and wealth controlled by the top 1% who, year after year, sock away their entire surplus in pro-managed family offices.
The result of all this is what we've seen for years, which is that growth keeps chugging along in a narrow slow range (and it's going to slow down even further now that we have full employment) while equity prices keep on marching higher, punctuated by occasional washout moves to flush weak-hand trend followers, poorly-thought-out quant strategies, and other pockets of crowded positioning. Then the automatic flows do their thing and the market is right back up at ATHs a few weeks or months later.
To really change this situation you need one or more of: serious political turmoil (like WW3, or a shooting civil war in the USA), a breakout of high inflation forcing the Fed to hike rates dramatically, or an unstable speculative bubble on the order of 2000 or 2008. The 1982-2000 secular bull ran for 18 years before the tech bubble and crash broke its momentum, this one can easily go longer.
Oh fer crying out loud!
Bullish...bullish...bullish...long...long..long.
Shattered I hate to shatter your dreams. They forgot the T factor!
I am pretty certain the bulls will be running until the end of the year, at least. Beyond that, we will see. If Trump's policies manage to keep the run going, then expect an adjustment when he leaves office or when it is certain that he will be leaving office. That adjustment could be fairly small, or it could, and more likely, be Jellystone Park. Bears in control.
Good summary in general, but I would say that the systematic risk that everyone is ignoring right now is civil unrest. It happens quite frequently. The bubble is that the political elite think that the sheep are going to keep going along with the plan. At some point, they will have had enough.
As an aside: healthcare for illegals? WTF is this shit
Honestly, someone who enters the country illegally has committed and is committing an ongoing illegal act. That person must not be allowed to benefit from it. I do not have a problem with changing immigration law to make legal immigration easier. America is a nation of immigrants. I do have a problem with those who break the law however it stands at the moment. I am sick and tired of all the amnesties, etc given over the years to legalize illegals. They may be basically honest. In fact, I know that most are, and that most are moral, hard working people. That is not the point. The point is that they knowingly broke the law after considerable planning to do so, and are breaking the law every second that they remain in the country. And they should not be catered to. As far as medical care goes. naturally emergency care is and will be given. General, ongoing, health care is the responsibility of the individual or the country from which he or she came from. Apologies to the far left, but this is logical, correct, and RIGHT. Nobody has any business spending MY money on people who are illegally here to benefit from it, without my consent. And I do not give it.
%%
Good points, Mr Mpas; some say we've seen 2 bear markets , in the past 10/12 years,based on 200 day moving average + 20 % correction. Is a 19.5% correction close enough?? It is for me
, .Speaking of wildlife management, your question is like, what about 16 million doves flying in Argentina , is that trend likely to end?? [Many fly into Cordova.]That trend is not likely to end; 16 million doves is most likely to trend , like a friend. Most likely 32 million + doves now.
Having said that ,summer selloff could easy sell off to 200 day moving average; but 4th quarter OCT-DEC tends to be super strong- not a prediction
,