Global Opportunities Beyond the Radar

Where Is the Market Bottom? Look at the Past 75%

 

The year was 2008.

It was the season of the fear.

Every man, woman, and child — along with their dog, cat, and goldfish — were panicking.

And why not?

America was being hit hard by the subprime mortgage crisis. The S&P 500 index plunged over 38% that year. The nation was struggling with the worst recession since the Great Depression.

‘The end is nigh,’ screamed the prophets of doom. ‘America is finished. It will never recover from this.’

 

Source: Medium

 

However, amidst the noise, Warren Buffett — the Oracle of Omaha — had a different opinion. He believed that what was happening was just a temporary blip on the radar.

So Buffett wrote to the anxious shareholders at his investment company, Berkshire Hathaway. He offered them some measured wisdom:

In other words, the sun would keep on shining. The birds would keep on singing.

Certainly, Buffett remained optimistic despite the fear. And his evergreen message could be summed up like this: ‘Never bet against America.’

Of course, being optimistic was the hardest thing to do in 2008.

Everyone was caught up in the crisis of the moment. Emotions ran wild. The word on the street was that this was a civilisation-ending event.

But…of course…it wasn’t.

 

Source: CNBC

 

Ultimately, Warren Buffett was proven right.

The financial storm soon passed.

The markets eased back into growth mode.

A new cycle began.

But…here’s where things get interesting:

So, it’s clear: over the long-term, markets tend to drift up.

No war, no recession, no rumour will keep the market down for too long.

Now, for your historical interest, here’s what the annual percentage change for the S&P 500 has looked like over the past 40 years:

 

 

Year

Annual Change

2023

5.02%

2022

-19.44%

2021

26.89%

2020

16.26%

2019

28.88%

2018

-6.24%

2017

19.42%

2016

9.54%

2015

-0.73%

2014

11.39%

2013

29.60%

2012

13.41%

2011

0.00%

2010

12.78%

2009

23.45%

2008

-38.49%

2007

3.53%

2006

13.62%

2005

3.00%

2004

8.99%

2003

26.38%

2002

-23.37%

2001

-13.04%

2000

-10.14%

1999

19.53%

1998

26.67%

1997

31.01%

1996

20.26%

1995

34.11%

1994

-1.54%

1993

7.06%

1992

4.46%

1991

26.31%

1990

-6.56%

1989

27.25%

1988

12.40%

1987

2.03%

1986

14.62%

1985

26.33%

1984

1.40%

1983

17.27%

Current as of 26 January, 2023, at 11:30am NZST
Source: Macrotrends

 

 

Here’s what you need to know:

 

Our opportunity for you

 

Of course, we human beings have a negativity bias:

Well, try looking at the bigger picture. Pain in the short-term is necessary for happiness in the long-term.

Therefore, corrections are actually healthy. Desirable, even. Because the end of one cycle promises the beginning of a new one.

Rebirth. Renewal. Rejuvenation.

So…are you avoiding the market? Or…are you embracing the market?

Weigh it up.

Here at Vistafolio, we are helping our Eligible and Wholesale Clients regain control of their destiny by building a roadmap to financial freedom.

At the moment, we have our eye on investment targets in Australasia, Europe, and North America. We are especially keen on resilient sectors like infrastructure, energy, and commodities.

It’s about protecting your wealth. Growing your wealth. Gaining passive income.

So, are you looking for guidance? For direction?

Come talk to us. We’re now offering an initial free consult for Eligible and Wholesale Clients. We’d love to hear more about your financial goals and dreams.

 Click here to register your interest today.

 

Regards,

John Ling

Analyst, Wealth Morning

(This article is general in nature and should not be construed as any financial or investment advice. Vistafolio services are for Wholesale or Eligible investors as defined in the Financial Markets Conduct Act 2013. Please request a free consultation if you would like to discuss your eligibility.)

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