This Model Suggests Negative S&P 500 Returns Over The Next Decade Comments? https://www.benzinga.com/analyst-ratings/analyst-color/21/09/22849073/this-model-suggests-negative-s-p-500-returns-over-the-next-decade
What the fuck did I just read? "...Benzinga’s Take: If investors trust the Bank of America long-term valuation model, S&P 500 index funds like the SPDR S&P 500 ETF Trust will likely drift sideways at best for the next 10 years..." This Benzinga guy is out of his mind. Sideways movement on SP ETF for 10 years. Another dipshit that has never traded for profit ever in his life. He really needs to have a steaming hearty cup of STFU.
Secular Bull Market ends sometime. The transition should see some huge volatility. There was a story about a guy in 29' getting stock tips from his shoe shiner. He then proceeded to liquidate all his holdings that week, a month before the crash. Of course it bounced hard and finally bottomed in 34'. An archery teacher gave me some unsolicited advice, citing how well he has done the last 10 years, and suggested we put the entire clubs funds into the market "right now, why wait?" I laughed and said you don't plant corn in December. Since proficient traders can navigate any market direction, it should separate the wheat from the chaff rather spectacularly.
Mkt drops 30% tomorrow and needs 43% to show a gain. Maths. Japan nearly touched 40K in 1989... and it's still down 25% from that high.
Well, it would take two days for market to drop 30%, not just one day, thanks to the breakers. Maths? You a closet Brit? heh. I know what you are saying, but I cannot fathom that the ES market is going into a sideways motion for 10 fricking years! I mean, if the range is good, great for traders. And maybe even good for your vols. But TEN YEARS? Oy gefelte!
deflation killed Japan's capital mkts. They have never recovered. Can you imagine a delevered housing market losing 20%? What it would do the the eq-mkts?
No, I cannot. I was working big-box home-improvement retail from 2005 to 2009, and never really noticed that big of a dip in home improvement sales. At that time, I was totally oblivious to what the equity markets were doing. I just came in and did my job. And man, the stores were always busy. When we had the housing crash of those years, and afterwards, did the SP move sideways for 10 years? Obviously not. People had money to spend back then, and they spent it. Why would the following 10 years after today be any different?
Wow that is an amazing stat. One would have been completely wiped out if you bought Japan in 1989, still down 25% after 30+ years? That is just so... depressing, it could happen to any of us...
Very tough for me to see this happening. Stock allocations are at roughly 2000 highs, before the Fed put became entrenched and when you could get 5% risk free. Predicting negative equity returns from here is equal to saying that investors will put every incremental dollar printed over the next 10 years into bonds+cash, plus actually rotate away from stocks in enough size to overcome the tailwind from divs+buybacks. In an environment of negative rates... Seems much more likely that the equity risk premium will get crushed, with SPX PEs to 50-100 - implying substantial gains ahead.