Tuesday, May 25, 2010

On Schedule for a Very Long Bear Market

Here is a video where Robert Prechter discusses the recent global sell-off that has sent all major U.S. averages 10% below their 2010 highs with Yahoo! Finance Tech Ticker host Aaron Task. This is from last week. Prechter says that the current climate shows that "we're in a wave of recognition" where the fundamentals are catching up to the technicals and that it's time to prepare for a "long way down."

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5 comments:

fool53 said...

Conventional wisdom is that WWII brought us out of the depression, even though the Market bottomed in 1932. Even though mood turned up it was a long while until enough people felt that the depression was over. Imagine that when the market bottoms potentially in 2016, that it takes a decade to reach a consensus that the depression is over - which takes us out to 2026. Geez.

David said...
This comment has been removed by the author.
David said...

@fool53:
Living standards (for those lucky enough to avoid a blood sacrifice to the folly of war) did not return to anywhere near normal until 1946/47. Economic historians erroneously use unemployment as a proxy for the depression, when in fact drafting 3 million men into the military and staffing up War Socialism with Rosy the Riveter did almost nothing to alleviate the deprivation of the depression.

You hit the nail on the head; we can't imagine how deep or long the deprivation of this evolving debacle will be, but those of us using the socionomic playbook have to be quaking in our shoes. Advance planning only counts for so much when we expect the world around us to pass through such a gauntlet.

Flagg707 said...

Debacle is going to be the right word for it, I think. Imagine the social structures and political/social outlook of an entire generation whose experience is framed by a massive Depression...

David said...

Social/Political structures framed by people who woke up one day and discovered their Disney life was replaced by either Saw I-IV or The Road....

Now I'm really depressed.

I've written elsewhere about the sensation that most will feel as this wave washes over us. *Blindsided.*

That's the sort of reorientation that defies my attempts to prejudge it.