The Dark Side of Deficits
By John Mauldin
August 26, 2010
1282887095
Secular Bull and Bear Markets
It’s Not the (Stupid) Economy
The Consequences of a Credit Crisis
The Dark Side of Deficits
LA, Europe, Kansas City, and Houston
In the pre-crisis days, I used to write about
things like P/E ratios, secular bull and bear markets, valuations, and all of
the things we used to think about in the Old Normal. But what about those
topics as we begin our trip through the New Normal? It's time to reconvene
class and think through what might change and what will remain the same. I
think this will be a fun read - and let me tip my
hand. I come out on the side of a new secular bull that gets us back to trend -
but not just yet. The New Normal has to have its turn first. (Note: this will
print out longer than usual, as there are a lot of charts.)
And speaking of first, I once again need some
help from readers. I will be in "jail" next week for the Muscular Dystrophy
Society. I need you to help bail me out. You can go to
https://www.joinmda.org/downtowndallas2010/johnm
and make a donation to help kids and families who really need help in
these difficult times, and also help sponsor research that will eventually cure
this disease. If you follow the link, you can see a cute video - and then make
your donation!
I thank you and
I am sure Jerry's kids thank you too!
Secular Bull and Bear Markets
Market analysts (of which I am a minor variety) talk
all the time about secular bull and bear cycles. I argued in this column in
2002 (and later in Bull's Eye Investing) that most market analysts use
the wrong metric for analyzing bull and bear cycles.
(For the record, even though I am talking about
the US stock market, the principles apply to most markets everywhere. We are
all human.)
"Cycles" are defined as events that repeat in a
sequence. For there to be a...
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