• 48 mins Saudis Eye Billions As Stocks Get Emerging Market Boost
  • 4 hours Airbnb In Acquisition Mode Ahead Of IPO
  • 7 hours Gold Hangs At $1,300 Ahead Of Fed Meeting
  • 9 hours Champagne Sales Slow As European Economic Worries Grow Louder
  • 1 day Putin Signs “Digital Iron Curtain” Into Law
  • 1 day Russian Metals Magnate Sues U.S. Over Sanctions
  • 1 day Tesla Looks To Jump Into Indian Market
  • 1 day Global Banks Lay Groundwork To Re-Inflate Asset Prices
  • 2 days Homeowners Experiment With Risky New Investment Trend
  • 2 days U.S. Tech Stocks Look Increasingly Vulnerable
  • 2 days De Beers To Expand World’s Most Profitable Diamond Mine
  • 2 days Ford CEO Gets Raise After Massive Layoff Round
  • 3 days Germany’s Flirtation With Recession Could Cripple The Global Economy
  • 3 days Where To Look As Gold Miners Inch Higher
  • 4 days Google Faces Billions In Fines From European Regulators
  • 4 days The Energy Industry Has A Millennial Problem
  • 5 days Russian Banks Scramble For Sanction Loopholes
  • 5 days Gold ETFs Take A Hit After Four-Month Run
  • 6 days European Union Takes Aim At Ten New Tax Havens
  • 6 days Goldman Defends Trillion-Dollar Corporate Buyback Spree
Lending: The Good, Bad, And Ugly

Lending: The Good, Bad, And Ugly

Aristotle said, “The most hated…

The Chatroom Cartel Running Global Bond Markets

The Chatroom Cartel Running Global Bond Markets

Eight major banks have been…

  1. Home
  2. Markets
  3. Other

Progress of The Secular Bear Market: Position as of July 31, 2013


The value for R was 1885 on July 31, 2013.


Progress Update on Secular Bear Market

Over the May through July period I gradually shifted out of stocks as the S&P 500 reached the upper 1550-1600 period. I sold by last position last month when the index was in the low 1600's. The P/R graph above shows that the market has reached roughly the same position relative to past secular bear markets as it had in 2007. There is still room to rise and the current bull market will likely run quite a bit longer, particularly as the length of the current business cycle, at least than 6 years, is still quite short. I had made a similar argument in December 2007, and was wrong. So this time I decided to sell as soon as P/R indicates a relatively overvalued market.

The bet I am making is that there will be another downturn as there was in the past and this downturn will send P/R below its previous low of 0.49. If I assume the next downturn will have happened by 2020, seven years from now, I can extrapolate the R growth curve to estimate a value of about 2550 then, which when multiplied by 0.49 gives a value of 1250 for the next bottom, well below today's levels, at which to move back into stocks.

 

Back to homepage

Leave a comment

Leave a comment