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Nowhere to Hide

Nowhere to Hide

October 26, 2022
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Nowhere to Hide

Written by Dale Black

Historically, How Does This Bear Market Stack Up? Courtesy of First Trust, the below table shows all bear markets since World War II. The average duration of the previous 12 bear markets lasted 367 days. The current bear market has endured for 270 days and counting (278 days now thru the 10/12/22 closing low). Since 1946, the average price decline from the peak is -33.6% and the 2022 bear market has inflicted a -25.4% loss. The average price gain 12 months after the bear market trough is +40.8%, but we have no way of knowing at this point where that ultimate trough will plant its flag. So, the 2022 bear market is on the tamer side of things compared to average post-WWII bear markets. Note where the chart shows the date the bear market began, the number of days it lasted, the percentage the market dropped from the high to the low, and what occurred the following 12 months after reaching the low. Obviously, there are no guarantees that past results are indicative of future performance. The trends indicate it pays to be patient and wait out the down times.

There is no place to hide in this market. Even money in a bank is being held hostage by inflation. At this point, we do not know where capitulation (finding the bottom) is. There will be bull runs inside bear markets. Until something changes, we expect the market to remain soft and inflation to be stubbornly high. Looking back over the years, the market has always recovered. I have no reason to believe now is any different. Putting more money to work is buying things on sale. Your gut tells you it’s crazy to invest now, while your head is telling you the opposite!! Presently, our accounts are 80% in cash with no market exposure. We will be mostly in cash until something changes. We watch your account every day. Please reach out to Global View Capital Advisors if you have any questions or need assistance.

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