We are still in a secular bear market! (Secular means a long period of time). The last secular bear market lasted 17 years – If we count back starting in 2001 – and history proves itself, that means we have about 7 more years of a bumpy ride. Don’t be fooled by the last 2 years. Most bear markets have periods of retracement. But as the recent volatility suggests, these periods eventually wash out. I see storm clouds ahead. The bounce in a secular bear market lasted about 26 months during past downward cycles and that puts us around mid May of 2011.
Funny how some people are just gluttons for punishment. If you get creamed in 2002 and/or 2008, why are you still in the ring? It doesn’t hurt to step out for a while. If I’m right, you still have your gains and have avoided another blood bath, If I’m wrong, well you still have your gains!
Steve Blumenthal, CEO of Capital Management Group, an Investment Advisory firm, sees a pullback of about 34%. I like the people he hangs out with – brilliant minds like John Mauldin and Dr. Christopher Geczy. I’m in their camp . Here it comes, buckle up. This is going to be another wild ride. If you choose to stay on – keep your eyes wide open! No surprises here.
Get the heck off and just watch. Somewhat of a thrill, but without the high blood pressure.
The Choice is Yours.
-Kathy
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