Bob Brinker's opening monologue last Saturday was a short history lesson about the stock market--from his viewpoint. It was an unusually long monologue, but I think it is very interesting, so I transcribed it.
Here is a portion of it--Brinker said:
"But it has to do with something that I regard as very, very important, and that is mega-trends, also known as, secular-trends. Now, secular, in this case, does not mean studying for the clergy, secular, in this case, means over very, very long periods of time that are best described as mega-trends. Now, when you take a look at the mega-trends, let’s go back all the way to the early part of the twentieth century, you could start with one of the shortest mega-trends of all time and that was the secular-bull mega-trend that lasted from 1921 until September of 1929. Now that eight-year secular mega-trend, or secular bull market, was really a good one when the market roared ahead, chalked up gains approaching 500% in the major indexes and it was very, very rewarding, but it also required identification of a top, because that secular bull market, which was very unusual in that it only lasted eight years, it ended with a catastrophic decline. In fact, the decline that started in September of 1929, when the secular bull mega-trend ended, the decline that started then, which kicked off the secular bear mega-trend that lasted from 1929, September, all the way out to the summer of 1949, which is a very, very long period of time. We are talking a 19 ¾ -year secular bear mega-trend. That started with the worst cyclical bear of all time.
.
As you know, if you’re a Moneytalk listener, secular mega-trends consist of a series of cyclical bull markets and cyclical bear markets. Well, the secular mega-trend, the bear secular mega-trend that started in September of 1929 kicked off the worst cyclical bear of all time because by 1932 the DJIA had lost 89% of its market value. This is not counting cash dividends, it had lost......"
I have posted the full verbatim transcript here:
investment.suite101.com |
