When was the last time the S&P500 grew over 30% in one year?

[audreyh1]

When were we ever certain we were out of the woods?

By looking back in history. Once you are, say 50% above a prior inflation adjusted peak, you can be pretty sure that even another bear market won't break the old high.

 

[Hamlet]

That seems a little silly. So if the stock market shot up 1000% tomorrow, and then dropped 80% back to only twice what it is today, would we be in a new secular bear market until the price was back above the all-time high?

It seems like we could just as easily say we are in a really, really, long-term secular bull market because we are way above the highs set in 1929.

Only if it recovers the previous inflation-adjusted all time high AND there is not another sell-off to take you back below it.

We finally met the first test just a few months ago. But, we could still easily have a correction to take us below that level in the near future, so we aren't out of the woods yet.

The S&P 500, Dow and Nasdaq Since Their 2000 Highs

 

[Chuckanut]

By looking back in history. Once you are, say 50% above a prior inflation adjusted peak, you can be pretty sure that even another bear market won't break the old high.

I'll take your word for it.

 

[eytonxav]

Well, in the "new normal" they were talking about high unemployment and low growth. They weren't wrong about that part. They were talking about the economy, not about the stock market .

Yes, but the pundits (eg Bill Gross, etc) back in 2009 translated that slow growth into much lower market returns going forward. At least he was right about the bond market.

 

[audreyh1]

That seems a little silly. So if the stock market shot up 1000% tomorrow, and then dropped 80% back to only twice what it is today, would we be in a new secular bear market until the price was back above the all-time high?

It seems like we could just as easily say we are in a really, really, long-term secular bull market because we are way above the highs set in 1929.

We're just talking about historical patterns, that there are long periods where the S&P500 gains faster than inflation and P/E expands, and other periods where it stalls and P/E shrinks.

The scenario you describe above hasn't happened yet.

 

[mickeyd]

S&P 500 close~

12/31/2012~ 1426.19

12/31/2013~ 1848.36

Best year since 1997.

 

[audreyh1]

I will, I will!!! But if you listen very closely, you might be able to sense, if not hear, a very secret, totally silent "Wheee!!!" echoing throughout the land for the next 19 hours or so, in anticipation....

OK, W2R, NOW you can let it rip!

Happy New Year!

 

[W2R]

OK, W2R, NOW you can let it rip!

Happy New Year!

Now? Now? NOW?

~~~~~ WHEEE!!!! ~~~~~ Dow 16577!!!

Happy New Year!

Things are looking GOOD and just in time for the end of the year computations.

 

[audreyh1]

Looks like the S&P500 Total Return for 2013 is going to be:

32.39%!!!

 

[Fermion]

Because of bonds I only captured around 19% to 20% in 2013

Stupid bonds.

 

[audreyh1]

Because of bonds I only captured around 19% to 20% in 2013

Stupid bonds.

Most people did well less than 20% because they were positioned around 50/50 stocks/bonds. That's not a bad thing.

 

[Fermion]

Most people did well less than 20% because they were positioned around 50/50 stocks/bonds. That's not a bad thing.

Agreed, but having a few hundred thousand in your 401K that returned a negative 0.8% for the year makes you feel like a sucker. Someone got to use my $200,000 a whole year and charged me 0.8% to do it!

 

[Gumby]

~~~~~ WHEEE!!!! ~~~~~

Now we're really screwed.

 

[REWahoo]

Now we're really screwed.

Yep. That will surely send 2014 into the septic tank.

 

[audreyh1]

Yep. That will surely send 2014 into the septic tank.

At least it didn't crush the 2013 results!

Besides, it's time to rebalance!

 

[eytonxav]

Yep. That will surely send 2014 into the septic tank.

But think, in a few days time you'll have a buying opportunity

 

[audreyh1]

Jan 2 - worst market drop since Nov 7.

Behold the power of W2R!

 

[W2R]

Jan 2 - worst market drop since Nov 7.

Behold the power of W2R!

Either that, or maybe a LOT of people were selling on January 1st in order to rebalance for the New Year, just like I did.

 

[imoldernu]

S&p 500