Sometimes you have to diary these things for a few years and revisit them:
Markets Showing ‘Extreme Similarities’ With 1929 Crash: Pro
CNBC.com, Tuesday, 19 Mar 2013 | 8:53 AM ET“Investors should remain on the sidelines and wait for a market correction as a 4-year rebound comes to an end, Sandy Jadeja, chief market strategist at SignalPro said on Tuesday.
Jadeja said the current market cycle showed “extreme similarities” with the 1930s.
“If you take a look at the patterns which repeat themselves through the years, they are re-emerging. So what it’s suggesting is: it isn’t all good out there,” he said.
When this forecast was made, the S&P500 was at 12% lower. Add in 2 years of dividends, and this money-losing attention-seeking prediction cost anyone who followed it about 16%.
Never forget this simple truism: Forecasting is marketing, plain and simple.
This gentleman should’ve learned his facts: The US was on the gold standard in 1929…that’s why we had deflation 1929-1933.
No nation not on a gold standard has ever suffered sustained deflation. None. Ever.
Now, in gold terms? 1929 already happened in the US, from 2000-2009…the Dow and S&P fell 90% in gold terms.
“No nation not on a gold standard has ever suffered sustained deflation. None. Ever.”
Wait, is this some sort of semantics/dictionary definition thing, or what do they mean with all the news headlines the last year (or three) about deflation in Europe?
… or Japan ?!
BR, I think opportunity cost was about 35%, not 16%–probably 40% with dividends reinvested (S&P was ~1550 March 18/19 2013).
Ouch!
Query: suppose the S&P declined 30% over 2015. Would you feel to need to qualify this blog entry?
Let’s discuss :)
Someone who calls for a 1929 crash — 1929! Down 80%! GREAT DEPRESSION! — and 2 years later markets are up 16% is already wrong.
Markets have 1a 10% correction on average every year, 20% every 2 years. A 30% decline is not 1929.