Over the past month, I have heard quite a few people declare this to be the start of a new bull market. The kindest thing I can say in response to that is the jury is still out, but the weight of the evidence is inconclusive.

In terms of historical analogies, investors should be asking themselves: Is this move more like 1982 or 1974?

death-of-equitiesConsider: 1982 marked the end of a 16 year, secular bear market, which saw the Dow finally get over 1,000 on a permanent basis. It kissed that level in 1966, and again a few more times prior to breaching that level for good in 1982. After 16 years, nominal returns were zero, but on a real (inflation adjusted) basis, buy & hold investors lost nearly 90% of the purchasing power.

At the beginning of that 18 year long Bull market, equities were despised, bond yields were high and P/E ratios were single digits. History does not repeat precisely, but there is usually a rhyme involved.

I have noted in the past that following major bull runs, markets often have a major refractory period, wherein it takes years to work off the excesses of the prior period. Even in that period, markets will get deeply oversold and rally, and deeply overbought and sell off.The current secular bear is no different.

This could be 1982, but I doubt it. Instead, consider the 1973-76 period as a analog: The 23 month, 45% sell off was followed by 22 month, 76% rally. I could live through that again, as long as disco doesn’t come back also . . .

I’ll see if I can dig up a few relevant charts later.


1966-1982 Trading Range (December 29th, 2005)


100 Year Dow Jones Industrials Chart (December 28th, 2005)


Looking at the Very Very Long Term (November 6th, 2003)


Category: Markets, Technical Analysis

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

57 Responses to “Market Rally: 1974 or 1982?”

  1. VennData says:

    The shorts are barely “Stayin’ Alive”

  2. call me ahab says:

    the US economy has serious issues- the stock market will reflect that in the medium and long term- short term?- who gives a shit- put some money in- roll the dice and see what happens

  3. danm says:

    Just can’t see a strong lasting bull market when we’re starting with rates of 3%.

    Any rate increase will lower multiples and offset eps growth. Didn’t we start from a higher base in 1974 with rates higher than 3%? Divide by .03 and you get 33X, divide by .05 and you get 20X. Big difference!

    If we get a new bull market, it’s because government is buying.


    Government buying or because you’re getting incredible eps growth to compensate for increasing rates.

    And in such an environment, eps growth would probably come from inflation.

  4. Dennis says:

    Only 3 sectors of the S&P are in the green — 7 are negative.

    Not the stuff of bull markets . . .

  5. Patrick Neid says:

    I’m still sticking with 73/74 until the March lows are violated. Admittedly it has diverged and since recovered from the beginning of the year but nothing is exact. However the world ending headlines, capitalism is dead, it is all the market’s fault, politicians know better etc have stayed spot on through it all.

    Here’s a chart that summed it up until December last year.


    If the “depressionists” are right the market should break new lows. We shall see.

  6. bshaheen says:

    Were in the “con” game period now, as in confidence, where the Gov. has pretty done all it can, and more, and now we hear more and more happy talk about “green shoots” and all of the data and earnings are all “better than expected” with the accompanying ohhs and ahhs on GNBC (Greed NBC). So now its all propaganda that’s supposed to palliate fear and give the impression that things will only get better. Its easy to beat expectations when expectations are so low that if they were any lower, you’d be talking about a dead body. Things can only fall so far off a cliff.

  7. ZackAttack says:

    I didn’t see anything like this rally coming. As I mentioned in a previous thread, I saw nothing in the chart to indicate that the S&P should stop at 666.

    I didn’t get killed in the rally because I’m long/short nearly all the time. So far this year, it’s been a simple plan: long energy over short S&P and short the long end of treasuries. Theory was, underinvestment in energy infrastructure would play whack-a-mole with any nascent recovery.

    The first pair has been a wash. Couple of bright spots in the coals and oil services. It feels like everything in the market is perfectly correlated right now, so you might as well own an index as a stock.

    The TLT short has me slightly green this year, but it feels like slapping a cop, with everyone doing everything they can to hold down long rates.

  8. ZackAttack says:

    I still haven’t heard or seen anything to explain this whole move, other than some Goldman Sachs conspiracies. Being an advocate of Occam’s Razor, I’d love to hear some alternatives.


    BR: How about deeply oversold . . .

  9. gloppie says:

    There is nothing wrong with Disco!
    Dow 3599,99

  10. wally says:

    A market that is not based on the potential of underlying earnings must instead be based on the hope for speculative increases. The market is as full of emptiness right now as it was before the tech bust.

    People who still have not learned the difference between investing and speculation are welcome to put their money back into this stock market. I hope they do. The purging won’t be complete until they are separated from their money.

  11. One thing that’s different about this recession and the market’s reaction to this recession is that we now live in a 24 hr news cycle full of blogs, tweets and cable news. During 74 or 82 you had to wait for the morning paper to get a good read on the markets and how stocks had behaved during the previous day. There was time to digest information, but not anymore. Also, the number of market participants was probably a small fraction of what it is today.

    The market’s become a momentum traders dream and “buy and hold” might have to be filed away next to your Victrola record player.

    Finally, for all of the posters that think there is excessive bearishness on TBP, troll around some other websites. It’s 1999 for some of the mouthbreathing, CNBC chasing crowd.

  12. bdg123 says:

    New bull market? Now that’s hilarious. These pinheads are something else. This rally es easily explainable and it not sustainable. It might last six months or three months or might end tomorrow but the fundamentals driving it are comprised of one data point. Liquidity.

  13. this: “16 year nominal returns were zero, but on a real (inflation adjusted) basis buy & hold investors lost nearly 90% of the purchasing power…” to me, seems key.

    over the longer-run *Real rates of return will be key. Those allowed to provide inputs into the front-end of the consumption machinery will be assured, barring their own gross negligence, a + ROI.

    or, differently, “Things” make the World go ’round. Fiat makes the World (merry) go ’round, though not for most..

  14. Bill in SF says:

    Speaking of NBC, just got through reading a GE Investor Update for May ’09, an noted the following list of NBC Universal Upcoming Films:

    May 29: Drag Me to Hell (Alison Lohman, Justin Long)
    June 5: Land of the Lost (Will Ferrell)
    July 1: Public Enemies (Johnny Depp, Christian Bale)

  15. Hondo says:

    What did nominal and real earnings look like at both ponts?

  16. Myr says:

    I disagree with your framing of the question :) I’m wondering if this is March 1930(where we had a 6 month, 50% bear market rally followed by calamity) or Jun 1991 in Japan( followed by 17 years of sideways and downwards moves).

    The nation is drowning in debt(unlike 1974 or 1982) that can’t be serviced. This will take a long time to play out.

  17. anyone else catch Cramer clapping back at Roubini this am (presumably for the buffoon comment)

    “Does Roubini favor nationalization because he has people short through this RGE Monitor outfit? Is that what this is all about?” -Cramer


  18. DMR says:

    Neither. It is April to November, 1938.

  19. Marcus Aurelius says:

    It’s neither — the scenarios don’t jive, neither will the outcome. Virtually everyone sees the non-correlation in the traditional relationship between economic fundamentals and the behavior of the markets.

    So, what’s keeping the markets up? Non-traditional measures. That’s what.

    The Fed is using open market operations to allow primary dealers to purchase stocks (or some other equally nefarious fiscal fuckery). We’re witnessing the pump phase of the biggest pump and dump in history.

    Equilibrium will win, in the end. There’s still no such thing as a free lunch.

  20. Chief Tomahawk says:

    Silver on fire the last two days. Methinks it sensitive to reflation efforts.

  21. call me ahab says:

    Marcus Aurelius Says:

    ‘nefarious fiscal fuckery”

    good one- I”ll have to put that in my quiver of “go to” catch phrases

  22. Marcus Aurelius says:

    Chief Tomahawk:

    PMs and foreign currencies are starting to reflect all of the new digital liquidity that’s been pumped into the top levels of the financial structure.

  23. Marcus Aurelius says:

    thanks ahab, but I read it or something similar somewhere else, and it stuck. Wish I could give credit, but I can’t remember where I read it.

  24. Mannwich says:

    Like many here have surmised, looks like it’s going to be business as usual on Wall Street. Nothing to see here. Move along please. Incredible.

    “The system will look more like what preceded the current environment than many people seem to believe,” Cohen said yesterday at a panel discussion on the future of Wall Street sponsored by Bloomberg News in New York. “I am far from convinced there was something inherently wrong with the system.”


  25. Marcus Aurelius says:

    “I am far from convinced there was something inherently wrong with the system.”

    Could it be the toothpick foundation and the lead superstructure? Naaaaah. . .

  26. Mannwich says:

    @Marcus: Of course HE doesn’t see anything wrong with the system. Why should he? Look at how well it has benefitted he and his friends. I don’t blame HIM for seeing nothing wrong with it. It’s done wonders for his life.

  27. mikeinpanglao says:

    Another comparison to TGD. I see nothing good coming from this bear market rally.


  28. leftback says:

    1938. That was a 50% rally, wasn’t it?. The parallel would be the massive pumping and printing of $.
    If we see the same, we would go all the way to SPX 999.99 !!

    Now, time to give credit where credit is due. Karen called for this rally to continue because of all of the reflation.
    Add in the astonishing short squeeze we have seen because of so many people staying short – people were even short at SPX 666… astonishing.

    I do find it remarkable that people have stayed in the ultra-short ETFs and been destroyed. I have certainly used them, and will do again, but I always have an exit strategy for the trade and try to remember the Gartman Rule about never adding to a losing position. I will continue to look for a good entry point for FAZ and SRS, but happy to keep some cash on hand and wait for another round of deleveraging. Stay flexible and solvent.

  29. Mannwich says:

    @jc: Deep down everyone (well, maybe not EVERYONE) the entire financial system is a Ponzi scheme. Let’s face it. How is this much different than what Madoff was doing? If this becomes commonplace with 401k’s as people need to tap them to live on, runs may occur and/or the entire 401k system will collapse.

  30. dead hobo says:

    BR offered:

    I’ll see if I cannot dig up a few relevant charts later. (BR: Done)

    Rather than posting a few charts, why not add some background that describes the economics before, during and after the period being charted? For example,what was going on in the economy that caused a 22month bear market rally? Why did people fall for it? Or was the 2nd leg down only peripherally related to the 1st.

    If you want to get graphy, the y2k downturn had a massive rally in the middle, and fell to pre rally lows, more or less, as fast as it originally rose. If charts tell the future, why not that one?

    This is a financial bubble world now and some really smart people know how to use the massive amounts of cash at their disposal to start fires, emotionally speaking, in the minds of the ignorant. Putting the world on welfare isn’t the same as economic growth just because those under assistance aren’t gasping for air in public any longer.

    Me, now that I know the system is being gamed, I know that it will fall as fast as it rose. Afterward, it will bubble again, maybe even more sharply because the fraternity of scammers and their enablers will happy talk he next run even higher. I’m just going to ride the waves and not fret if I don’t hit the absolute low or absolute high.

    The Obama Put is alive and well. The market won’t be allowed to fall too low because a rising market will keep the people happy. Forget that fundamental economics don’t support the rises. The scamsters he is using to help will make money when the market rises too high and falls too low. My plan is to follow the scamsters, not follow the herd.

  31. ironman says:

    BR wrote:

    I could live through that again, as long ass disco doesn’t come back also . . .

    Yeah, I’d have to draw the line at “ass disco” too! [BR: Fixed!]

    More seriously, I would describe the period from June 2003 through December 2007 as being much more like that from April 1963 through April 1966, with a similar breakdown in the years following (charted here, as always, you’re welcome to borrow it!) The period of disorder than began in April 1966 lasted until February 1976 and might be characterized as a series of disruptive events. On the plus side, it appears we’ve already had the oil shock, so if the period since January 2008 turns out to be similar, we are likely on the better side of what was the most significant disruptive market event in the 1970s.

  32. dead hobo says:

    In other words, the scamsters will use mini bubbles to keep the markets in motion. The bubbles will rise, but not rise too high. Then fall enough to make the next run profitable. The fundamentals of the economy will not matter. Over the next year or so, the markets will take on the profile of a mountain range. The massive amounts of capital available to the scammers, plus the know how plus the Obama Put will keep it going. Happy talk media will add credibility. The transfer of wealth from the public who buys too late to the scammers will be considered payment for assisting in preventing a complete loss of faith in the stock market and keep alive the hope that people will eventually recover their savings.

  33. The Curmudgeon says:

    I like the 1974 analogy if for no other reason than it seems our monetary system is encountering (or about to encounter) similar problems as then. The end of Bretton Woods, when Nixon closed the gold window (1971, as I recall), in many ways began the process ultimately leading to the dollar crisis of the late 70′s, that required a Paul Volcker to (successfully) fix, ultimately cementing the dollar as the continued reserve currency for the strictly fiat world that we now refer to as Bretton Woods II.

    Without the discipline afforded by an official standard against which to measure the currency (gold, silver, oil, etc.), it is exceedingly easy to leverage the dollar’s reserve currency status to implement social goals, like saving a bankrupt financial system. No other country has this option, because they can’t borrow money in the same currency they print. But the leverage will ultimately, like a Lehman Brothers real estate portfolio, weaken the entity that employs it.

    The monetary shenanigans undertaken by the Fed in this crisis (to ameliorate the monetary shenanigans that got us here) has a long way to run until its effects are fully realized. So it is no surprise that stock markets can bounce back up as real economic conditions are literally papered over by the Fed. But these are just monetary delusions. Like the seventies, we seem hell-bent to believe the delusion and ignore the realities. Leisure suits were ugly then and still are. If they, or something like them, make a return appearance, you can bet we are full bore into the denial that lead to pet rocks, smiley faces and economic malaise.

  34. dead hobo says:


    Obama Put

    You read it here first.

  35. Marcus Aurelius says:

    dead hobo:

    You following them is exactly what they’re counting on, as that is the direction the herd always moves: with the trend, and they create the trend. They will stop short of the cliff, and the herd will run over the edge — precisely because the herd is following them and gaining momentum on the way.

    They will feast on the carcasses of the herd.

    The “people” are not happy. Not the huge number of recently unemployed. Not those who hold houses with steadily decreasing values. Not those who formerly counted on using said homes as a source of income, ad infinitum. Not those getting ready to retire. Not those who can’t afford health care.

    Answer me this: Who are the “scamsters”? Where are those who were busted flat in the recent crash getting the money to reenter the markets? Where is all of this liquidity suddenly coming from? Hedge funds? The wealthy? Mom and Pop? The gainfully employed? Who is it, exactly, that you will follow?

    Stay well behind the herd, my friend. Do not follow too closely, lest you find yourself in free fall.

  36. constantnormal says:

    I’m with leftback, the ’33-’37 rally may be closer to this one than either the 74 or 81, although … I think it is most likely that we are making a new archetype here, that people will point back to in future recessions and say “is this like the bounce in ’08-’10? (or maybe ’08-’11, I dunno)

    The amount of market control by only a few players is quite remarkable here. Not really a market at all.

    I suspect we will get our next shot at a downturn when this quarter’s earnings are reported, after another month or two of dismal unemployment numbers, amid the most tepid summer housing scene in many years. That would put it at mid-July, leaving a lot of headroom for Mr Market to go nuts in.

  37. constantnormal says:

    This fall will likely bring us the imminent defaulting of several cities and states, along with a lot of pension fund distress. I just cannot imagine (but my imagination has been failing me a lot lately) a new bull market in the face of that …

    And who is making the spikes in gold over the past could of days? rumors requested …

  38. dead hobo says:

    Marcus Aurelius,


    I’m not going to follow the heard. I’m keeping an eye on the scamsters. Zero Hedge has some articles about GS and the Supplemental Liquidity Provider program. Basically, one could see this as legalized market manipulation. GS and others have a choice to make … repeat the mistakes of the past by blowing giant and unsustainable bubbles OR blowing a lot of mini bubbles that take on the appearance of real economic activity. I’m betting on the latter since that route is sustainable and can be made to look real. Oil to $147 allowed the concepts to be developed and proven. It also lit up the mistakes. A series of mini bubbles is the best course to make money on the way up and down several times.

    And so goes the Obama Put.

  39. leftback says:

    @ constant: You are correct about the enormous hidden problems in munis and pension funds. Add in the hedge fund redemptions that must come to cover the expenses of the now not-quite-so wealthy and there is another tidal wave of equity and high yield bond selling out there in our future.

    “And who is making the spikes in gold over the past could of days? rumors requested …”

    That would be Karen, presumably. :-)

  40. call me ahab says:

    DH – you have a compelling conspiracy theory- possibly some truth to it

  41. Transor Z says:

    I’m really intrigued by the “pilot” Supplemental Liquidity Provider program.

    Being “assigned” a grocery list of equities to buy to provide liquidity, enable price discovery, and maintain “orderly” market activity.

    How is that not a system of artificial price supports? How is that not juicing a market by bidding up the price?

  42. Mannwich says:

    @Transor: Goldman = Quasi-PPT. I’ve been asserting this for weeks now. Isn’t it obvious?

  43. The Curmudgeon says:

    “I’m really intrigued by the “pilot” Supplemental Liquidity Provider program.

    Being “assigned” a grocery list of equities to buy to provide liquidity, enable price discovery, and maintain “orderly” market activity.

    How is that not a system of artificial price supports? How is that not juicing a market by bidding up the price?”


    How is this unlike the printing of money to buy Treasuries/MBS/GSE debt, etc.? It’s all market manipulation intended to create the illusion of demand through the vehicle of cheapening the money.

    How does either not run afoul of prohibitions against it? Because…it’s done for the collective good, and isn’t that the point behind all those SEC and antitrust and RICO laws? Besides, it’s the government. What is illegal for you is perfectly legal for it. (See, for example, state-run lotteries).

  44. Mannwich says:

    @Curmudgeon: Whose “collective good” are you talking about? Mine? Yours? Or the folks who are in charge?

  45. callistenes says:

    I can handle anything BUT disco!

  46. Transor Z says:

    All right, Curmudgeon, you asked for it. I’m going to get all Justice Jackson on your ass! :)

    That comprehensive and undefined presidential powers hold both practical advantages and grave dangers for the country will impress anyone who has served as legal adviser to a President in time of transition and public anxiety. While an interval of detached reflection may temper teachings of that experience, they probably are a more realistic influence on my views than the conventional materials of judicial decision which seem unduly to accentuate doctrine and legal fiction. But, as we approach the question of presidential power, we half overcome mental hazards by recognizing them. The opinions of judges, no less than executives and publicists, often suffer the infirmity of confusing the issue of a power’s validity with the cause it is invoked to promote, of confounding the permanent executive office with its temporary occupant. The tendency is strong to emphasize transient results upon policies — such as wages or stabilization — and lose sight of enduring consequences upon the balanced power structure of our Republic.

    Youngstown Sheet & Tube, 343 U.S. 579 (1952) (Jackson, J., Concurring)

    OH — SNAP!

  47. CNBC Sucks says:

    1974? 1982? Whatcha talkin’ ’bout, Ritholtz?

    The presently “not held accountable”, money-printing time machine of the United States Treasury and Federal Reserve (why don’t they just merge?) has magically transported us back to around 1919 (or maybe even 1337 or 400 AD). The can has been kicked.

    Enjoy the flappers while you can, boys.

  48. [...] Earlier this morning, I asked whether the Market Rally was more reminscent of 1974 or 1982. [...]

  49. Pat G. says:

    I prefer disco over much of the foul mouth, ill intended music of today. Besides it was easier to dance to. I still feel that the ’70s period is more reflective of our current situation from a fiscal perspective. Fleckenstein’s latest article sums it up best. While GDP has contracted by 6% in each of the last two quarters “prices of core personal consumption expenditures (a measure of inflation that Greenspan particularly focused on) rose 1.5% quarter to quarter, versus expectations of just 1%. There was no deflation but rather inflation.” Remember these are government numbers so the rise was probably higher than reported. When not if, oil and food prices start to rise again, it’ll make a 1.5% rise in core personal consumption expenditures look tame. Bernanke was asked by Paul today as to what the FED will do if inflation increases ty 8-10% while unemployment rises and the economy remains in a funk. BB’s response, “That’s not likely to occur”. We have never experienced anything like this downturn in our global history, yet this arrogant fool is so sure of what governments are doing that in effect; there is no plan on sopping up the liquidity that they’re creating. This will lead to runaway inflation levels.

  50. aitrader says:

    Stay, stay, stay, stay, stay, stayin’ alive..stayin’ alive

    1975 maybe?

  51. @CNBC “The can has been kicked.”

    That does seem to be the plan.

  52. [...] it’s probably too early to tell, FusionIQ CEO Barry Ritholtz says investors should ponder whether this recent run-up mirrors 1982 or 1974. [...]

  53. cvienne says:


    It seems that many of us (the dumber ones – yours truly included), have been kicked in the ass by these ULTRASHORT ETF’s (FAZ – SRS – etc.)…

    I’ll tell you something though…I’m simply going to hold onto the SRS for as long as possible and see where it goes…If it goes to zero…screw it (its just a small piece anyway)…Think about it, if you use SPG as a proxy (the largest and most respected component or CRE indices), it’s trading at a 6.0 PEG ratio and over 30 P/E…Now I know you can generally toss out numbers like that, but tell me where the “G” is going to come from in the future…Donald Trump himself says he can’t get financing for anything commercial, and the consumer is tapped out…Unless the “anchor” stores (like Nordy’s & JC Penney decide to buy up all the sq/ft. and pay 2006 prices for them, I see SPG and others going the way of General Growth…And the “G” didn’t work out for them all that well did it?

    I’ll give you a DIFFERENT perspective on the 2x ETF (that the ‘mathies’ may have figured out awhile back)…Think about it…it’s “directional”…There are TWO different aspects of “directional” on an “x” & “y” matrix (time and amplitude)…If you do a comparison on SPG to SRS in the short term, the numbers are skewed, but over longer timeframes, they actually do converge and revert to a mean…To give you a START on that I’ll use the following dates…OCTOBER ’07 HIGH (SRS around 72)…SRS absolute high…(for fun let’s call it 216 because the “spike” higher was an anomality)…So you had a 3x move peak median to peak during the market selloff…Over time, you’d expect to have a -3x median to trough move off a 72 base…72 divided by 3 = 24…Now these numbers aren’t exact…If you wanted to get wild and wooly, you could say that the SRS peaked at 273 on 11/21/08…That’s almost a 3.8x multiple…So let’s say the decline could have the same amplitude (72 divided by 3.8 equals 18.94)…

    What I’m saying is this…And trust me, I don’t know if my theory is going to be correct or not…But I’d say that we’d be looking at 15.00 – 19.00 as the ultimate spike bottom for the SRS…You could arrive at that range another way…Let’s say that SPG decides to go up and “technically” visit it’s 200 day MA (even though old “Goldy” has the habit of taking it off its conviction buy list at $46)…Well, that’s another 13% move off its recent peak…So if you 2x that and calculate the impact LOW on SRS…You’d put yourself in the same range ($15.54 to be exact – but even that print would only be a brief blowout, unless you think even the “Goldy” conspirators are going to bid up the SPG to it’s all time highs…

    Again, this is all a THEORY…But THAT’s why I’m holding on to my stupid little SRS position even though the price is WAY DOWN off my cost basis…At $21…I’m looking at maybe another 30% loss (say if I entered here and/or committed ZERO more capital to the position)…But a reversion to mean (over time based on when the market corrects and/or when even “Goldy” decides it would rather buy GOOGLE with a 1.1 PEG instead of SPG at a 6.0 PEG), says that as a the market eventually puts in a bottom (which means SPG either does a fibonacci retracement off it’s lows, does a full retest, or actually breaks lower – which I think is possible)…You’re looking at a move back to somewhere between 45-72 on SRS (and “gravy” on top of that if somehow the market REALLY tests the bottom when Congress is on recess, Obama is in Hawaii, and Bernanke is in Jackson Hole, or whatever the hell he does when he’s not printing money – let’s call that date MID-AUGUST)…

    So I don’t know…I can take buying at $21…sucking up a 25% loss…then selling at a double or triple if the planets align…

    It’s just an experiment…

    For all of you who are reading my words for the first time…I appreciate your patience…This was kind of long winded…I’ve had PASSWORD RESOLUTION issues trying to post here b4 but hopefully now that’s resolved…

    I READ “all” of your comments (and have mentally categorized you REGULARS)…I think you ALL are very bright and I enjoy your insights and anecdotes…


  54. Bob_in_MA says:

    One fairly major point left out by those comparing this the 1970s/80s: inflation.

    During the 1974/75 recession, asset prices of households and businesses ROSE. This time they’re falling. Equity prices fell 48% in 21 months, the value of corporate assets, from 1972 to 1974 rose 35%!! From 2007 to 2008 they fell 3%.

    Equities fell about the same %, and in each case the Q ratio was around .9 at the market top, but at the 1974 bottom it was half (ca .3) what is was in 2008 (ca .6, close to the long term average).

    This mindless comparing of graphs is really silly.

  55. Jojo says:

    I always like to repost this when 1974 is mentioned:

    From a newsletter dated 5/12/1997 written by Jay Shartsis of R.F. Laffery & Co..

    1974 – What does a real market bottom feel like?

  56. [...] 4. Over the past month, I have heard quite a few people declare this to be the start of a new bull market. The kindest thing I can say in response to that is the jury is still out, but the weight of the evidence is inconclusive. Market Rally: 1974 or 1982? [...]

  57. [...] Market Rally: 1974 or 1982? (May 5th, 2009) [...]