The Flinchum File

Thoughtful Economic Analysis and Existential Opinions
Subscribe to the Flinchum File
View Archives

Good News Is Not Bad News

The stock market is bouncing around record highs.  I hate that — because investors start asking if it is time to sell.  “You know, it can’t go up forever.”

That’s true – the stock market will go down . . . eventually.  But, I don’t think it is going down significantly anytime soon.  Take a look at this graph:

Chart of the Day
Yes, we’ve seen this graph before, but it bears repeating.  There have been 13 major rallies over the last 115 years, averaging 8.8 years in length.  We are not near the average rally yet.  Plus, these rallies were after 30% bear markets.  We just had a 50% bear market, and rallies tend to be stronger after severe bear markets.
This bull still has room to run . . . let him run!