This also isn't the start
of a bear market from a technical point of view.
I explained why this isn't the start
of a bear market from a fundamental point of view.
Indeed, if you check out this compilation
of bear markets from Yardeni Research, you'll see that since 1929 there are have been 46 times stock prices fell by 10 % or more (and a few more times that just missed the 10 % threshold), but fewer than half (20) of those declines went on to become bear markets.
This week I've examined the course
of bear markets from 1871 to date (really to March 2009, the end of the last bear market).
Not exact matches
Chipotle, one
of the first national brands to
market where its ingredients come
from, has faced supply - chain issues and food -
borne - illness outbreaks as its restaurants have grown in number to more than 2,300.
Based in the UAE currently,
from where she takes care
of Siemens» UAE, Egypt, Qatar, Oman and Kuwait
markets, the Syrian -
born Al Rifai started with Siemens as a Commercial Project Manager in Damascus, Syria, in 1997, and is a graduate
of the University
of Damascus.
The number
of big - name investors calling a bond
bear market added hedge fund legend Paul Tudor Jones on Thursday, following similar calls
from Bill Gross, Bill Miller and Jeff Gundlach.
Not so the Canadian stock
market, which is why we are all acutely feeling the painful effects
of a
bear market in energy and why this would be a great time to think about whether you're getting enough diversification
from your holdings.
Moving up the income statement can mitigate the damage
from a
bear market but still ensure access to the prospects
of the credit.
As
of Thursday's close, shares
of P&G were in a
bear market, off 20.8 percent
from their record high hit in September
of $ 94.67 a share.
I didn't realize that doing this can mitigate the damage
from a
bear market while allowing me to have access to prospects
of the credit, so I might consider this option.
Pursuant to a
marketing and servicing alliance with a third party consumer lender (the Credit Provider), the Credit Provider offers credit cards and non-card payment plans
bearing our brands and we receive income
from the Credit Provider (Program Income) consisting
of 1) ongoing payments based on net credit card sales and 2) compensation for
marketing
Why should we expect Mylan or any other pharmaceutical company to refrain
from yanking up the price
of lifesaving drugs as high as the
market will
bear?
Written as your go - to financial freedom playbook, Unshakeable offers investors
of all levels —
from millennials to baby boomers — the knowledge, tools and techniques to become an unshakeable investor: to dispel any fears you have
of bear markets, build a strong diversified portfolio and gain peace
of mind amid economic uncertainty.
Imagine 2 hypothetical investors — an investor who panicked, slashed his equity allocation
from 90 % to 20 % during the
bear markets in 2002 and 2008, and subsequently waited until the
market recovered before moving his stock allocation back to a target level
of 90 %; and an investor who stayed the course during the
bear markets with a 60/40 allocation
of stocks and bonds.4
This way, if a
bear market occurs, you have a year
of cash becoming available at the maturity date so that you do not have to sell stocks, and in a bull
market you can buy new bonds as the ones you own mature, and you thereby benefit
from the higher interest rates that high quality bonds give versus cash or CDs.
But the average one lasts less than two months and out
of all
of them, 80 percent never become a
bear market (meaning the
market falls 20 percent
from its peak).
The stock has now suffered the deepest price correction — a decline
of at least 10 %
from a significant high, since the stock climbed out
of its 2012 - 2013
bear market in August 2013.
[01:10] Introduction [02:45] James welcomes Tony to the podcast [03:35] Tony's leap year birthday [04:15] Unshakeable delivers the specific facts you need to know [04:45] What James learned
from Unshakeable [05:25] Most people panic when the stock
market drops [05:45] Getting rid
of your fear
of investing [06:15] Last January was the worst opening, but it was a correction [06:45] You are losing money when you sell on corrections [06:55]
Bear markets come every 5 years on average [07:10] The greatest opportunity for a millennial [07:40] Waiting for corrections to invest [08:05] Warren Buffet's advice for investors [08:55] If you miss the top 10 trading days a year... [09:25] Three different investor scenarios over a 20 year period [10:40] The best trading days come after the worst [11:45] Investing in the current world [12:05] What Clinton and Bush think
of the current situation [12:45] The office is far bigger than the occupant [13:35] Information helps reduce fear [14:25] James's story
of the billionaire upset over another's wealth [14:45] What money really is [15:05] The story
of Adolphe Merkle [16:05] The story
of Chuck Feeney [16:55] The importance
of the right mindset [17:15] What fuels Tony [19:15] Find something you care about more than yourself [20:25] Make your mission to surround yourself with the right people [21:25] Suffering made Tony hungry for more [23:25] By feeding his mind, Tony found strength [24:15] Great ideas don't interrupt you, you have to pursue them [25:05] Never - ending hunger is what matters [25:25] Richard Branson is the epitome
of hunger and drive [25:40] Hunger is the common denominator [26:30] What you can do starting right now [26:55] Success leaves clues [28:10] What it means to take massive action [28:30] Taking action commits you to following through [29:40] If you do nothing you'll learn nothing [30:20] There must be an emotional purpose behind what you're doing [30:40] How does Tony ignite creativity in his own life [32:00] «How is not as important as «why» [32:40] What and why unleash the psyche [33:25] Breaking the habit
of focusing on «how» [35:50] Deep Practice [35:10] Your desired outcome will determine your action [36:00] The difference between «what» and «why» [37:00] Learning how to chunk and group [37:40] Don't mistake movement for achievement [38:30] Tony doesn't negotiate with his mind [39:30] Change your thoughts and change your biochemistry [40:00] The bad habit
of being stressed [40:40] Beautiful and suffering states [41:50] The most important decision is to live in a beautiful state no matter what [42:40] Consciously decide to take yourself out
of suffering [43:40] Focus on appreciation, joy and love [44:30] Step out
of suffering and find the solution [45:00] Dealing with mercury poisoning [45:40] Tony's process for stepping out
of suffering [46:10] Stop identifying with thoughts — they aren't yours [47:40] Trade your expectations for appreciation [50:00] The key to life — gratitude [51:40] What is freedom for you?
To get a sense
of what's at stake when you pull out
of the
market, even temporarily, during a
bear market, the Schwab Center for Financial Research compared the returns
from four hypothetical portfolios:
I firmly believe that having a portion
of your portfolio out
of stocks during a
bear market is essential to protecting you
from yourself.
Generally, a
bear market happens when major indexes like the S&P 500, which tracks the performance
of 500 companies» stocks, and the Dow Jones industrial average, which follows 30
of the largest stocks, drop by 20 percent or more
from a peak and stay that low for at least two months.
That's not to say that acceptance
of a recession would mark a long - term
bear market low, particularly because the S&P 500 hasn't even lost 20 %
from its peak.
Since 2001 the silver and gold
markets have gone up substantially as a reaction to the 20 year precious metals
bear market from 1980 — 2000, massive increases in military spending, weakening global economies that REQUIRE Quantitative Easing to avoid deflation, the rise
of competing currencies that weaken the dollar's trading status, excessive debts in Europe, Japan, the United Kingdom, and the United States, and so much more.
After having recovered all
of its losses
from the early 2000's
bear market, the S&P 500 dropped 53 %
from October 2007 to March 2009.
They may not earn a high return going forward and may even lose some in the next
bear market, but I believe the psychology
of holding bonds will stop some people
from doing the wrong thing at the wrong time.
When valuations move
from elevated levels to historical lows over the span
of several
market cycles, the result is a «secular
bear market» and headlines about the permanent death
of equities.
Darin Kingston
of d.light, whose profitable solar - powered LED lanterns simultaneously address poverty, education, air pollution / toxic fumes / health risks, energy savings, carbon footprint, and more Janine Benyus, biomimicry pioneer who finds models in the natural world for everything
from extracting water
from fog (as a desert beetle does) to construction materials (spider silk) to designing flood - resistant buildings by studying anthills in India's monsoon climate, and shows what's possible when you invite the planet to join your design thinking team Dean Cycon, whose coffee company has not only exclusively sold organic fairly traded gourmet coffee and cocoa beans since its founding in 1993, but has funded dozens
of village - led community development projects in the lands where he sources his beans John Kremer, whose concept
of exponential growth through «biological
marketing,» just as a single kernel
of corn grows into a plant
bearing thousands
of new kernels, could completely change your business strategy Amory Lovins
of the Rocky Mountain Institute, who built a near - net - zero - energy luxury home back in 1983, and has developed a scientific, economically viable plan to get the entire economy off oil, coal, and nuclear and onto renewables — while keeping and even improving our high standard
of living
So it's important not to assume that just because the uniformity
of market internals has improved or deteriorated, the entire cycle has shifted
from a bull
market to a
bear market, or vice versa.
Performance varies greatly for bonds
of different credit qualities, but even during the worst
bear market for bonds, the 40 - year period
of rising rates
from 1941 to 1981, the worst 1 - year loss for the Bloomberg Barclays US Aggregate Bond Index was just 5 %.
These risks and uncertainties include food safety and food -
borne illness concerns; litigation; unfavorable publicity; federal, state and local regulation
of our business including health care reform, labor and insurance costs; technology failures; failure to execute a business continuity plan following a disaster; health concerns including virus outbreaks; the intensely competitive nature
of the restaurant industry; factors impacting our ability to drive sales growth; the impact
of indebtedness we incurred in the RARE acquisition; our plans to expand our newer brands like Bahama Breeze and Seasons 52; our ability to successfully integrate Eddie V's restaurant operations; a lack
of suitable new restaurant locations; higher - than - anticipated costs to open, close or remodel restaurants; increased advertising and
marketing costs; a failure to develop and recruit effective leaders; the price and availability
of key food products and utilities; shortages or interruptions in the delivery
of food and other products; volatility in the
market value
of derivatives; general macroeconomic factors, including unemployment and interest rates; disruptions in the financial
markets; risk
of doing business with franchisees and vendors in foreign
markets; failure to protect our service marks or other intellectual property; a possible impairment in the carrying value
of our goodwill or other intangible assets; a failure
of our internal controls over financial reporting or changes in accounting standards; and other factors and uncertainties discussed
from time to time in reports filed by Darden with the Securities and Exchange Commission.
Note
from dshort: Since the middle
of the last century, there have been nine
bear markets in the S&P 500 using the 20 % selloff
of the «
bear -
market» benchmark.
As indeed they should — due to the
bear markets of 2000 and 2008 that wiped out most
of the excesses
of the late 1990s, stock
market returns
from 1990 to 2011 were actually below the long - run average!
If you want to ensure you get the big returns
from stocks that investment writers highlight when urging you to invest in equities, you need to buy during
bear markets to make up for the lousy returns
from those years when you buy at what proves to be the top
of a bull
market.
At the bottom
of a
bear market decline, the amount lost
from peak - to - trough appears so devastating that investors are often induced to sell at what is actually an extraordinary buying opportunity.
Still, regardless
of whether or not a
bear market has started, I believe the Fund remains on track to achieve its investment objective even when we measure the complete cycle
from the 2002
bear trough to the next
bear trough, whenever that occurs.
Major cryptocurrency - focused venture capital firm Pantera Capital CEO Dan Morehead said last week that the price
of bitcoin will likely surge by next week, after it rebounds
from its
bear market.
Many emerging
markets are already in
bear markets, with 42 percent
of stocks in the MSCI World Index down at least 10 percent
from their 2014 - 2015 peaks.
People are discouraged
from the sector in periods like we're in now where we've seen several years
of vicious
bear markets where people are afraid and they miss the sector just as it's about to turn.
While Facebook remains more than 10 % below a record set earlier this year, it has sharply rebounded
from recent weakness, when a scandal over how it handled its user data pushed it into
bear -
market territory, or a decline
of at least 20 %
from a peak.
The vertical axis measures the six - month percent change in the S&P 500
from the bottom
of each
bear market going back to the early 1940's.
Several countries» stock
markets entered corrections (i.e., declines in excess
of 10 %), and Japan's energetic bull
market quickly became a
bear market (down 20 %
from the peak).
As we write it is 79, up
from 77.60 in a normal
bear market rally assisted by a temporary manipulation by the US government that will be
of no lasting consequences.
That «cycle» measured
from the low point
of one
bear market to low the low point
of the next, lasted 69 - months.
Last March net wealth declined
from a peak
of $ 22 trillion to $ 12 trillion and due to a
bear market rally it has moved back to about $ 15 trillion.
The use
of «bull» and «
bear» to describe
markets comes
from the way the animals attack their opponents.
The S&P 500 - at -15.3 % might not have fit the «definition»
of a
bear market, but don't tell that to the average stock, which fell 34 %
from its 52 - week high.
The gold rally that began in December
of 2015 will differentiate itself
from the 1982 - 1983
bear -
market rebound if the gold price closes above its July - 2016 peak AND the HUI closes above its August - 2016 peak.
In fact, Mr. Ritholtz is one
of several commentators who believe this rally has merely been a temporary cyclical swing in the midst
of a longer - term
bear market — one that began roughly a decade ago and is far
from over.
This instance may be different in the near term, but a century
of evidence argues that the completion
of the
market cycle will wipe out the majority
of the gains observed in the advancing portion to - date (even without valuations similar to the present, the average, run -
of - the - mill
bear market decline has erased more than half
of the
market gains
from the preceding bull
market advance).