The Chart that had Wall Street Scared - Three Months Later

A few months ago, I shared the chart that had Wall Street spooked in the post

Does History Have a Way of Repeating Itself?

This chart showed how today’s stock market is very similar to the market right before the Great Depression

hit in 1929.

Many experts argued it was nothing more than coincidence.Yet, here's the chart a few months later.

The chart is still tracking right along, which is now making even the experts speculate.

Now, I want to make it clear that I find this more interesting rather than a good predictor of future market performance. There are all kinds of similar charts from the markets over the years, and they tend to be more coincidental than anything else.

Note that it is also true that markets move in cycles, and we all know that those who forget history are doomed to repeat it.

We are coming up on the 5th year of our current bull market run. In the last 10 years, we’ve only had one down year, 2008. Do you think that's a good indicator that a big bad bear is coming?

Bear markets happen from time to time, normally about every 3 years or so. It’s called, “normal market conditions”. 

In my opinion, the real value of this chart is to bring to your attention that a bear market could be well on it's way. We don’t know exactly when, and we don’t know exactly how bad it will be. What we do know is that if you are retired or retiring soon, ignoring that upcoming bear is foolish at best.

The question you need to be asking yourself is how you are going to protect yourself when it hits?

If you haven’t already, it’s a great time to talk to our team to get some ideas on that. Give us a call at (775) 853-9033.

Chris Abts