Forever Bull Market

It doesn't matter what happens. This thing won't drop. Been hearing it all year. Inflation came in hot this week, market still went up. No matter what Powell does it will go up. There's too much liquidity and 0DTE options preventing a drop from every happening.

 

Then you were out to lunch in 2019.

 

He is saying this time is different. No need to worry anymore.

 

The US stock market has a long term upward bias - just the structure of the market. This is the SPX from 1927:


Right now I'd say we're about the same distance above the regression line as we were in late 1999. So we may have some more upside until we reach the blow off top. Then the mean reversion takes hold and we enter a serious long term bear market.

 

You sounded very sad / fearful / worried / disappointed / frustrated.

How much $$$ did you lose from trading?

Go do day trading.
Then you don't worry about FOREVER BULL, PERPETUAL BULL,
FOREVER BEAR, PERPETUAL BEAR or whatever.
Then you don't have to worry about the animals bull bear whale shark...

 

Lol, welcome to 2013 bro.

Monthly 401(k) contributions + buybacks decreasing the share count year after year == the market always drifts up, with the exception of a handful of years like 2022.

 

“Mean reversion” can’t happen unless investors in aggregate reduce allocations to stocks.

That’s happened to some degree with cash yields at 5%, but as can be clearly seen, the flows from rebalancing, buybacks, and monthly paycheck contribs have overwhelmed any selling pressure.

Really, a secular bear market (more than a year or two) means investors fleeing the US markets en masse, and that ain’t happening any time soon.

 

So your empirical evidence that prices must go up forever are prices this week and this year? That's an incredibly weak thesis.

 

Deflation only occurs when everyone things that future prices will be lower. I currently virtually zero chance of this happening, not anytime soon. For example, in Canada the housing stock is depleted. It will take almost 10 years of incredible construction boom to turn this around and provide housing for almost 800,000 new residents every single year. Then you have a decoupling of China and the US in trade. Russia and ukraine crisis, ever more stringent regulations that strangulate innovation and drive prices up. Where should lower prices come from in your opinion?

 

Rate hikes have been super bullish. All these rate hikes keep leading to the market going higher and higher.