Does History Have a way of Repeating Itself?

A great article came out last week on MarketWatch – click here for the article.

Here is the chart that has them spooked-

As you can see, our stock market is showing an uncanny resemblance to the stock market of the late 1920’s, right before the Great Depression hit.

Of course we know that, past performance is no guarantee of future results, good or bad but we also know those who forget the past are doomed to repeat it.

In the 1920’s, the stock market was driven up to record heights due to loose money policies (easy margin lending), before it collapsed and brought the Great Depression along with it. Decades later, the stock market has been driven to record heights due to loose money policies (zero interest rates).  We know eventually, the markets will have a downturn, but we don’t know when or by how much.

Of course, no one desires another Great Depression, or a market collapse that even comes close to 2008, much less 1929.  All I can tell say is that when charts show such a similar correlation on the growth side, it is surprising how often the down side replicates the past.

As I previously stated, past performance is no guarantee of future results, good or bad. Nevertheless, looking at this chart, wouldn't you agree that now is the time to review your retirement planning to insure your financial security and independence, regardless of what happens in the economy? Call our office at (775) 853-9033 to speak with a Retirement Planning Specialist.

Chris Abts