For those trying to better understand how and why market cycles move, historical perspective is critical. Doug Short offers an excellent primer in his latest: Secular Bull and Bear Markets Contrary to what the risk-sellers will tell us, secular bear markets have been the norm at least 40% of the time during the past 140 years as captured in this excellent chart:
Buying and holding at every price during secular bear cycles has been catastrophic for capital and for the finite humans who suffer repeated cycles of loss. All of which prompts a critical question that every person with savings to protect must decide for themselves:
“Historically, regression to trend often means overshooting to the other side. The latest monthly average of daily closes is 67% above trend after having fallen only 11% below trend in March of 2009. Previous bottoms were considerably further below trend. Will the March 2009 bottom be different?”
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