Bull Market or Bear Market Rally?

  • Bull Market or Bear Market Rally? John Mauldin Serial Bubble Blowers Bull Market or Bear Market Rally? Secular Bear Markets By The Numbers The 20 Year Horizon: The Real Long Run The Volatility Gremlin The Eagles Have Landed This week I want to briefly look at some comments by Stephen Roach and Rob Arnott, two of my favorite analysts.
  • . Then we quickly segue into Part One of a series showing the relationship between stock market returns, P/E ratios, inflation/deflation and the economy.
  • . Serial Bubble Blowers The dramatic fall of the Japanese Bond market this week, plus the rather high-pitched statements from the Bank of Japan suggest the Japanese Central Bank is close to the end of their ability to reflate their economy.
  • . But what of our own Fed? Stephen Roach of Morgan Stanley writes today, eloquently expressing my thoughts better than I: "With policy makers and financial markets now fixated on the great deflation debate, it's easy to lose sight of what precipitated this state of affairs.

    Tech Stocks vs. Gold Stocks
  • . Since the burst of the tech bubble it has become readily apparent that we are in the beginning stages of a secular bear market in general equities.
  • . So does this mean we are in line for another massive tech rally? Absolutely not! Every bear market experiences, and historically those poor souls that get caught up in them and believe them to be new beginnings usually end up sacrificing their hard-earned capital to the tech abyss.
  • . Over the course of history, for bulls and bears alike, the financial markets have punished the ignorant and rewarded the prudent.
  • . Investors who consistently make money in the financial markets are unbiased in their investment strategies and focus on the fundamentals of every market sector.
  • . If the general stock markets appear to be in a long-term downtrend, there is usually some other venue that has or will catch wind in its sail and outperform them.
  • . Commodities, like the stock market, have a history of running in large cycles over time.

    Junior Golds 101
  • . In a market where the flagship HUI unhedged gold stock index has seen its latest, but certainly not last interim top at +614%, the prudent investor is in pursuit of that diamond-in-the-rough, low market-cap, little-known junior that could reap legendary gains.
  • . As students of the markets we love learning, and we hoped this would lead to superior trades for our clients.
  • . If we were to rely solely on existing major gold producers to supply future markets with enough gold to come close to meeting demand, woe to the day they run out, yikes! To provide a macro view of how juniors can survive and thrive, we need to consider the economics of the gold supply chain.
  • . Gold producers are accountable to the markets by their inventories, formally known as measured ore reserves.
  • . The figures are calculated according to the tonnage and grade of gold within their terrain that can be extracted profitably based on current or projected market conditions and technology.
  • . Using simple economics, this alone is evidence enough for a secular bull market in gold.

    Thoughts from the Frontline
  • | Main Menu Sponsors Investing: Faith Versus History April 25, 2003By John Mauldin The Lackluster Economy Faith versus History Secular Bear Markets Blind Dogs and Janus Managers Phony Analysis Have We Seen the Bottom? What's in a Name? Additional Options This week we briefly look at a few choice economic insights, and then I once again will close with a portion of my book-in-progress about how to successfully invest in secular bear markets.
  • . "The number of Americans lining up for state unemployment benefits last week rose more than expected to the highest level in more than a year, the government said on Thursday in a report showing further labor market erosion.
  • . It was the highest level since the week ended March 30, 2002, and the tenth straight week that claims held above the key 400, 000 point, seen by economists as signaling an unhealthy labor market." (Reuters) As reported today, the economy grew by 1.6% in the first quarter; economists had forecasted gains of 2.0%-2.4%, so the number came in 20% below the lower end of the forecast.


    Photo by Commodities
  • Updated: New York: Jun 17 07:02 London: Jun 17 12:02 Tokyo: Jun 17 20:02 : Markets RESOURCES: Commodities Oil Prices Gain on Signs Economic Growth in U.S., China May Boost Demand June 16 (Bloomberg) -- Crude oil futures rose close to $70 a barrel on signs that the economies of the U.S.
  • . ``Everyone needs to have their energy demands met if they are going to continue to grow, '' said William Adams, chief energy and capital market strategist at LaSalle Futures Group Inc.

    Stock Market Cycles - The Key to Your Investing Success
  • Web Email Address: Your Name: Got an Ezine Marketing or Email Newsletter Question? ::/ Stock Market Cycles - The Key to Your Investing Success By Article Word Count: 595 Report This Article Report this article if you suspect it is not original content, is in violation of our Editorial Guidelines or our Author's Terms of Service.
  • . Understanding the cycles of the stock market are essential for protecting your money and making a profit.
  • . The cycles in he stock market are called the bull market and the bear market.
  • . Since the establishment of the stock market in 1900, there have been 27 bull markets each with their own bear market.
  • . The stock market moves in cycles- both long term and short term.
  • . Secular markets can last a long time between 10 and 20 years.
  • . Cyclical markets occur within secular markets and last between 2 and 3 years total.
  • . Therefore, at any given time the market can be described through it's current state of long and short term markets.

    Between Bulls, Bears, and Bafflement
  • . The most famous secular bear market lasted 24 years before the DJIA began a bull market that eventually surpassed the high watermark set just prior to the Great Crash of October, 1929.
  • . Today, as the DJIA hovers around the 10, 000 mark -- following the 18-year secular bull market that came to a crashing conclusion in early 2000 -- investors again are wondering if Dow 10, 000 represents much the same barrier as Dow 1, 000? Before we attempt to answer that question, let's first clarify a few terms.
  • . A cyclical bull market begins with a 20% or more bounce off the prior bear market's closing low.
  • . A secular bull market occurs when a cyclical bull goes on to set new record highs.
  • . The S&P 500 is currently in a cyclical bull market.
  • . The most recent bear market ended on Oct.
  • . Of course, we didn't really know we were in a new bull market until May 6, 2003, when the S&P 500 closed at 934.39, more than 20% above the October, 2002 low.
  • . So, are we at the beginning of a new secular bull market? We believe it's too soon to tell.

    The Bulls and Bears of Precious Metals
  • Hard Money Bull Market Hard Money Bull Market: The Bulls and Bears of Precious Metals by Pinank Mehta Whiskey & GunpowderDecember 28, 2004 Editor's note: Below, I present an essay from a friend and fellow hard-money enthusiast, Pinank Mehta.
  • . In this installment of Whiskey and Gunpowder, Pinank takes a look at where we stand in the course of this great new Hard Money Bull Market and the slow, agonizing, but not unprecedented death of debt-based consumption.
  • . Some market commentators look to the two-year correction in the 1970's gold bull market and are now calling for a similar correction! History rhymes, but does not necessarily repeat! Since I found this reasoning to be quite inadequate and studying the charts not as helpful, I went over the fundamentals once again.
  • . Debt-based consumption is being promoted as economic nirvana! Hard Money Bull Market: The Last Secular Bull Market Is there a simpler view to the gold-and-silver story? Assuming that gold and silver are in a secular bull market, I revisited the last secular bull market in the asset class called equities.

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    The Rise of Market Populism America s New Secular Religion
  • The Rise of Market Populism America s New Secular Religion by Thomas Frank The Nation magazine, October 30, 2000 When Richard Hofstadter wrote thirty years ago that "conflict and consensus require each other and are bound up in a kind of dialectic of their own, " he was offering advice to historians examining the American past, but he might as well have been t' describing the culture of the 1990s.
  • . The leaders of the left parties, both here and in Britain, accommodated themselves to the free-market faith and made spectacular public renunciations of their historic principles.
  • . The opposition was ceasing to oppose, but the market was now safe, its supposedly endless array of choice substituting for the lack of choice on the ballot.
  • . In international circles the grand agreement was called the "Washington Consensus"; economics writer Daniel Yergin called it the "market consensus"; New York Times columnist Thomas Friedman coined the phrase "golden straitjacket" to describe the absence of political options.

    Cyclical Bull Market Rally Financial Planning - FindArticles
  • IN > > > > Article FIND IN Find Magazines by Topic Cyclical Bull Market Rally , Content providedin partnership with The period from March to October 2002 was one of those rare secular bear markets normally experienced once in an investment lifetime.
  • . History reveals that extended secular bear markets are not promptly followed by strong secular bulls. Foolish Collective [Post of the Day] June 30, 2004
  • Quotes: Search: Welcome POST OF THE DAY Foolish Collective Market Dregs, Low P/Es Where are we Going Related Links Discussion Boards By kitkatklub June 30, 2004 Posts selected for this feature rarely stand alone.
  • . If we are currently entering the initial stages of a secular bear market, lets hope that's not the true definition.
  • . There have been seven secular bear markets and seven secular bull markets since 1800.
  • . The average returns for the bear markets has been 0.3% and the average returns for the bull markets has been 13.2%.
  • . It was the wrong time to be in the market for the long haul--17 years of small returns on equities.
  • . The bull market from 1982 to 2000 saw the DOW rise 1239% from 875 to 11, 723.
  • . A great time to be in the market.
  • . The average length of bear markets is 14 years and the average for bulls is 15 years.
  • . Where are we now? If you believe that the market must revert to the mean as Mauldin, Grantham and a few other bears do, you would have to say we are entering in to a secular bear that started in 2000 and has another 10 years to run.

    Fireworks in the precious metal market
  • FREE Daily Newsletter 7 Stocks You Need To Know For Tomorrow PowerRating FREE TRADING TOOLS FROM TRADINGMARKETS - - - - - - - - Search TODAY'S MOST POPULAR ARTICLES RECEIVE ALERTS FREE FOR ONE WEEK Receive Dave's best setups each evening from his favorite trading patterns.
  • . MOST POPULAR NEWS STORIES HIGHEST RANKED MONEY BLOGS TODAY'S MOST POPULAR INDICATORS Fireworks in the precious metal market April 21, 2006 5:00 PM ET | In our 2006 Investment Roadmap (see below) we highlight the expected 17 year cycle of higher relative prices for commodities and metals and pinpoint base metals, precious metals, and commodity indexes as key SECULAR BULL MARKETS during this period.
  • . Reversals in most of these markets LIKELY mean further backing and filling at least.
  • . However, new highs next week in most of these markets would be extremely bullish the metals.
  • . Remember that in SECULAR BULL MARKETS the surprises are usually on the upside, and traders should only be very long, long, or out, but never short.


    The treacherous nature of bear market rallies | Dr. Marc Faber

  • Saturday, June 17 - 2006 | : Browse related articles The treacherous nature of bear market rallies 'The market itself is forecasting recovery' reads the recent headline of a well known financial publication.
  • . As someone who follows market movements very closely and tries to read signals the markets may give about future business conditions, I was also interested in the market's recent strength.
  • . For a market, which has become very over-sold, it is only natural to rebound, but frequently these rebounds are merely bear market rallies, which are subsequently followed by vicious declines.
  • . Probably the most famous bear market rally in history is the rise, which took place following the October crash of 1929.
  • . This famous and well-documented bear market rally took place for a number of reasons.
  • . After the October 29 crash, the market had become very oversold - incidentally far more oversold than the US stock market's position on September 21, 2000.
  • . The interest rate cuts after April 1930 did, however, no longer support the stock market, which began to sell off once more.

    What goes up must come down! | Dr. Marc Faber
  • . Contrarians should short the US stock market and buy the US dollar, and accumulate oil stocks on market weakness as Chinese demand for oil is set to rocket over the next decade.
  • . In fact, 2003 will enter the financial history books as the year in which all asset classes - including equities in developed as well as emerging markets, government as well as any kind of corporate bonds, industrial commodities, precious metals, real estate, and art - increased in value.
  • . Admittedly, the Nasdaq, and especially the Philadelphia Semiconductor Index (SOX), did better, rising by 50% and 76%, respectively, in terms of the US dollar and by 25% and 46%, respectively, in Euro terms, but this was hardly a match for the emerging market gains (in US dollars) of 138% in Thailand, 131% in Brazil, 119% in Venezuela, and 104% in Argentina.
  • . 'And look at the stock market...
  • . it's up!' Fearing a confrontation, and concerned about missing my flight, I remarked in a conciliatory way that the dollar had declined in value, concurrently with the stock market's rise, thereby largely neutralizing - currency adjusted - any stock market gain.

    On Wall Street - A SourceMedia and Investcorp publication
  • . All over a penny! Although disillusioned investors may fault eBay's inability to "beat the number" and its intention to spend more on sales and marketing, important metrics were already weakening.
  • . You can't blame buy-and-hold bulls for feeling vindicated about sticking to their guns given back-to-back years of positive stock-market performance.
  • . History shows that such performance is less likely than another scenario: that the last two years were a big bounce in a longer secular bear market.
  • . For at least the last 100 years, 15-to-20-year bull markets have alternated with 15-to-20-year bear markets.
  • . Given that the last bull market ran from 1982-2000, we'd argue that the secular bear market has further to run.
  • . After all, within every secular bear market are sharp rallies that appear to signal a brand new bull.
  • . Rather than usher in a new bull market, that secular bear had another decade to run.
  • . The grueling Japanese bear market that took the Nikkei from almost 40, 000 to below 10, 000 produced several sharp rallies but still sank 80% during the period.

    Prudent Bear Funds, Inc. - Bear Case Library - Book Store - Manias, Bubbles & Market Histroy
  • Bear Case Library > Book Store > Manias, Bubbles & Market Histroy Book Store Ponzi's Scheme by Mitchell Zuckoff There's a reason that the old "rob Peter to pay Paul" scams are now simply known as Ponzi schemes.
  • . But “Riders” also gives readers a history of the recent stock market bubble, along with a fresh look at famous speculative manias.
  • . Unexpected Returns: Understanding Secular Stock Market Cycles by Ed Easterling Ed Easterling illustrates with text, charts, tables and graphs how difficult it will be for the stock market to deliver above average returns over the next 5-10 years.
  • . To reach this conclusion, Easterling provides a comprehensive review of bull and bear market cycles over the past century.
  • . He examines the components of stock market returns, shedding light on what are reasonable expectations for future GDP growth, earnings growth, and PEs.
  • . Buy and hold disciples may be disturbed by the duration of past secular bear markets, and may even want to re-evaluate their assumptions for the future.

    FEN Letter from the Editor: Securitization and financial product customization
  • . Michelle Smith of Goldman Sachs provided an interesting analysis of why the growth and development of markets for long-dated index options – up to ten years – offers insurers who write these kind of equity-indexed variable annuity policies with an interesting alternative to the frequent adjustments required by delta-hedging a portfolio of these policies over their life.
  • . A third session at the SOA Annual Meeting reviewed recent developments and experience by life insurance companies with securitization of life insurance policies – or as one presenter defined it – issuing securities backed by the cash flows from a defined block of insurance contracts in order to access the external capital markets and provide insurers new tools for balance sheet and regulatory capital requirements management.
  • . The focus is clearly on the development, marketing and successful launch of new retail financial products – certainly no surprise given that actuaries and insurers mainly think about risk from the standpoint of individuals’ needs for life, health, disability, property and casualty and retirement insurance. @CallCenter