12 DEC 2009, Saturday

1. STOP!!!  This market has got to stop this tight sideways chop-chop crap and pick a direction already...up or down.  Frustrating has been the word for weeks now. 
2. But for now, it's early on a cold wintry morning and a great time to do some research and post some thoughts on big picture, long term, "what if" stuff...just to throw it out there and get it posted to the blog so I can later go back and search for it when I need it.  This blog thing has really been helpful allowing me to go back and find old and relevant info.  Anyway...will be adding items throughout the day.
3. Click here for an EXCELLENT read from Martin Pring who is asking, "Are you ready for another lost decade?"  It discusses longer term Secular Bull and Bear Markets versus the normal Cyclical Bull and Bear Markets.  Things I found interesting were" 1) the number of recessions (4-6) contained in a secular bear cycle (we are currently in our second), 2) you'll want to look at his depiction of US stock prices in secular bears with their 7 waves exceeding 25% up or down, and 3) consider his "Pathway to the secular low" graphic to get a sense of where stock valuations historically go to during Secular Bear Markets...THAT is the point when everyone will have sworn off stocks forever and Buy and Hold can safely return...not until!  Research!
4. Below is a graphic I picked up at Barry Ritholtz's blog back in July but didn't post at the time (the "you are here" mark is July 2009 thus we are closer to roll-time).  It is the result of a study of severe financial crises throughout history (secular bear markets?), across many different countries, and shows how they tend to play out.  When I read Pring's "7 waves" it pinged my memory and I went and searched for the below graphic.  Whadya know?!!  7 waves...with 4 recessions?!!

1. Above...whaddya know?  After the big Secular Bull Market from the late 1940's to the mid 1960's...there's your inflation influenced Secular Bear Market with its 4 cyclical bear markets that eventually transitioned into the following Secular Bull Market that we all grew accustomed to from 1982 to 2000.
2. Below, is merely a repost / reminder to me of the tough 1970's and the eventual transition into the 1980's bull launch.