• 403 days Will The ECB Continue To Hike Rates?
  • 403 days Forbes: Aramco Remains Largest Company In The Middle East
  • 405 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 805 days Could Crypto Overtake Traditional Investment?
  • 810 days Americans Still Quitting Jobs At Record Pace
  • 812 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 815 days Is The Dollar Too Strong?
  • 815 days Big Tech Disappoints Investors on Earnings Calls
  • 816 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 818 days China Is Quietly Trying To Distance Itself From Russia
  • 818 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 822 days Crypto Investors Won Big In 2021
  • 822 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 823 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 825 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 826 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 829 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 830 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 830 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 832 days Are NFTs About To Take Over Gaming?
How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

  1. Home
  2. Markets
  3. Other

Global Equities Bear Market Has Us In a Hug


Most of us are too old to cry, but it also hurts too much to laugh. The global equities are in a bear market.

The conventional definition of a bear market is a decline of 20% from the high (which in this case we define as the 1-year high).

Virtually every significant country equity index is in, or nearly in , a 20% or greater decline from its high.

After a crushing day with price declines through the after-market period of 7.44% for the S&P500 large-cap stocks, 9.98% for the Russell 2000 small-caps, 9.42% in emerging markets, and 8.97% in non-US developed markets; the futures markets are down substantially from there. Tomorrow could be another damaging day.

Within the US, consumer staples (e.g. soap and cereal) and utilities are holding up the best, but virtually everything in the corporate equity category is down.

The US debt legislation, European solvency crisis, and China growth slowdown and banking stress are high suspect culprits. Corporations are doing well fundamentally up to this point, but governments are not doing so well.

Markets have gone from orderly decline to disorderly panic meltdown. A rally is a distinct possibility, but a sustained rally is unlikely without further downside testing.

Fortunately, we have been eliminating equity positions for weeks and months, now holding cash allocations in the 65% to 75% range; and gold in the 10% range. As a result, we have not felt the full brunt of the panic sell-off, although we have not avoided losses altogether, because positions were eliminated as declines became apparent in individual securities.

It's time now to begin thinking about the shopping list for re-entry, and the market conditions that would make re-entry appropriate. More about that in a subsequent letter.

Tonight, let's simply review the charts to establish in a definitive way that the bear has us in a hug.

Global Equities Bear Market Has Us In a Hug


Read the Report

Back to homepage

Leave a comment

Leave a comment