Is it a secular bull market? What it means for investors



My Sunday Washington Post Business Section column is out. This morning, we look at secular markets, and what they mean to investors.

The print version had the full headline (Page G1) Is it a secular bull market? What it means for investors while the online version sported the headline Significance of secular market should not be underestimated.

The best descriptor was really the headline after the print jump (Page G6): Secular market cycles reflect geo-political, economic and technological issues of era.

Here’s an excerpt from the column:

“I have come to understand that societies, beliefs and fashions all move in long arcs of time. We call these arcs several things: cycles, periods, eras. They vary in length and intensity, but they are typically characterized by an idiosyncratic set of qualities that set them apart from each other as unique.

Regardless of the name we affix to them, we intuitively understand what defines a specific period of time. If you name an era, I can describe for you the dominant economic and societal themes and trends. Ultimately, all of these eventually find their way to equities and bonds . . .

Secular cycles are the long periods — as long as decades — that come to define each market era. These cycles alternate between long-term bull and bear markets. Societal elements affect these markets. These cycles are driven by specific and dominant economic ideas.

Each secular market cycle reflects the key issues of an era. These can include geo-politics, economics, resource consumption, technology or any one of a number of other elements. Over time, each of these factors comes to define the dominant economic theme of a generation. Consider the post-War World II era, or the inflationary malaise of the 1970s or even the roaring 1980s and 1990s. Each period can be defined as a secular cycle.”

The Post included the classic chart in the dead tree version of the paper:

click for ginormous version of print edition
Secular cycles



Significance of secular market should not be underestimated
Barry Ritholtz
Washington Post, November 9 2014

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