There we have it – the longest bull market ever. On Wednesday, August 22nd 2018, the bull market was 3,453 days old and therefore lasted one day longer than the bull market during the 90s. Since March 2009, the S&P 500 (NYSEARCA: SPY) entered four corrections (where the index lost more than 10%), but didn’t enter a bear market since then. In 2011, we came close to ending the bull market early, but as the S&P 500 only corrected 19.39% and it only counts as bear market when the index corrects more than 20%, we are still in a bull market since March 2009.
(Source: dshort Updates – Advisor Perspectives)
In the following article, we are trying to explain how we were able to witness the longest bull market in history and present four different reasons that led to an almost 10-year lasting rally. But these four reasons are also four serious mistakes investors seem to make, especially in the last three years, and will cause the US stock market to backfire at some point in time, because even the longest bull market won’t last forever.
Mistake 1: Wrong Time Frame
It is pretty well established and widely accepted that economies develop in cycles and that a common business cycle lasts several years, but usually no longer than 10 or 12 years. Additionally, to the shorter business cycle, we also have longer debt cycles, which take about 75-100 years. It is important to think in such long time frames and look at historic developments in order to understand the current market. However, we have to be pleased if investors even look at several years and not just at the data of the last few quarters. Because investors tend to look at the wrong time frames (and to be more