Market cycle, revisited, or “it’s just another recession…”
As I wrote a week ago, we’re in the down swing of a market cycle. Miranda Marquit, over at Yielding Wealth, wrote about this same issue, and she included a list of the recessions we have experienced over the past few 80 years, staring with the “Great Depression.”
If you want a dramatic visual representation, check out this historical trend line for the Dow Jones Industrial Average. All those little “down blips” are recessions. But the market continues to grow.
The long-term average return on the market since 1929 has been 10.4%, although Crestmont Research says we shouldn’t expect this level of return in the future (long technical analysis included in this link). Even if this is true,we should expect some level of return above inflation. What do you think?