This Market Is Different

All of the talking heads have been telling us that this market is different. You are going to have to be patient and soon (hopefully in your lifetime) the DOW and the Nasdaq will be back at their old highs. They cite all the statistics about how the economy is improving - consumers are spending, the consumer confidence index looks OK, unemployment is getting better, blah, blah, blah.

Those trees are all nice, but they better step back and look at the forest. It's on fire and going up in smoke. The major trend has been down since the beginning of 2000 and is continuing with only occasional brief upward movements. The Dow lost 6% in 2000 and another 7% in 2001 and so far this year is off almost 8%. I won't mention the Nasdaq. That is ugly.

From 1931 to 1951 the economy doubled. The Gross Domestic Product was up 100% yet the stock market did nothing for 20 years. What few investors that were left after the '29 Crash made their money from dividends not stock price appreciation. It took 25 years for the stock market to go back up to the 1929 high.

Why are we in a bear market that can last for many years when things look so good? There does not seem to be a correlation between a good economy and stock prices. For more than 100 years the P/E ratio for the S&P500 index has been about 15. Today it is 41. That is figured on the earnings of a company paying you back your money in 41 years. YEARS! Are you kidding? I'll need my money before that. Very simply this is telling you that the stock market is very over-valued. Either corporate productivity must increase dramatically or stock prices must come down. Right now it looks like the latter is happening. So far about $6 trillion (that's with a 'T') has vanished from stockholders portfolios these last 2 years. Nobody else got it. It's just gone. It was all paper profit anyway.

Your broker tells you you don't have a loss until you sell and not to worry as the market always comes back - except when it doesn't. Since 1920 there have 3 major bull markets that have lasted about 16 years. The last one started about 1982 and ended at 2000. Each one of the bulls has been followed by a sideways to down market for the next 16 years. I am no soothsayer, but this has all the makings of one of those 16-year periods. What to do?

There is only one thing that is prudent until the carnage stops. Sell out of all stocks and stock mutual funds except no-load bond funds. (It is not too late to sell.) There are many good ones such as Government, International and Mortgage Backed no-load bond funds with varying lengths of maturity. It may not be exciting like the 1998-99 run up, but you will have your money when the dust settles.

This market is different. It's a bear.

Al Thomas' best selling book, "If It Doesn't Go Up, Don't Buy It!" has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter to receive his market letter for 3 months at www.mutualfundmagic.com to discover why he's the man that Wall Street does not want you to know.

Comments to al@mutualfundmagic.com

personalized cleaning services Des Plaines ..

In The News:

Petco disclosed a data breach exposing customer Social Security numbers, financial account details, and driver's license information due to a software error.

Baseball teams can now analyze complete swing mechanics in normal training environments using Theia's markerless AI system that processes standard high-speed footage.

Smart home hacking fears overblown? Expert reveals real cybersecurity risks and simple protection tips to keep your connected devices safe from hackers.

MIT develops needle-free glucose monitor using light technology. Revolutionary device could replace painful finger pricks for diabetes management.

The ClickFix campaign disguises malware as legitimate Windows updates, using steganography to hide shellcode in PNG files and bypass security detection systems.

Researchers from Osaka Metropolitan University designed a 21-foot dome that combines aquaculture and hydroponics to create a self-sustaining urban food system.

The Fox News AI Newsletter gives readers the latest AI technology advancements, covering the challenges and opportunities AI presents.

ChatGPT data breach exposes personal info of users through partner Mixpanel. OpenAI confirms names, emails compromised in security incident.

Android rolls out Emergency Live Video for 911 calls, letting dispatchers see real-time scenes during emergencies. Great for holiday travel safety.

Malicious Chrome and Edge extensions collected browsing history, keystrokes and personal data from millions of users before Google and Microsoft removed them.

Google's new Call Reason feature lets Android users mark calls as urgent before dialing, displaying an urgent label to recipients using Phone by Google app.

Medical history made as surgeons successfully restore sight to legally blind patient using world's first 3D printed corneal implant grown from human cells.

Data brokers aggressively collect your holiday shopping data to fuel scams and targeted ads. Learn how to delete your digital profile before 2025 starts.

Scammers are sending fake MetaMask wallet verification emails using official branding to steal crypto information through phishing links and fraudulent domains.

Learn what background permissions, push notifications, security updates, auto-join networks and app refresh mean to better manage your phone's privacy settings.

Criminals test stolen data by applying for deposit accounts in victims' names to prepare bigger attacks. Learn why banks won't share fraud details.

New study of 10,500+ kids reveals early smartphone ownership linked to depression, obesity, and poor sleep by age 12. Earlier phones mean higher risks.

A phone phishing attack compromised Harvard's alumni and donor database, marking the second security incident at the university in recent months.

AutoFlight's zero-carbon floating vertiport uses solar power to charge eVTOL aircraft while supporting emergency response, tourism, and marine energy maintenance.

A new phone return scam targets recent buyers with fake carrier calls. Learn how criminals steal devices and steps to protect yourself from this fraud.

New Anthropic research reveals how AI reward hacking leads to dangerous behaviors, including models giving harmful advice like drinking bleach to users seeking help.

The Fox News AI Newsletter gives readers the latest AI technology advancements, covering the challenges and opportunities AI presents.

Holiday email scams, including non-delivery fraud and gift card schemes, spike in November and December, costing victims hundreds of millions, the FBI says.

Holiday visits offer the perfect opportunity to help older parents with technology updates, scam protection and basic troubleshooting skills for safer digital experiences.

Swiss scientists create grain-sized robot that surgeons control with magnets to deliver medicine precisely through blood vessels in medical breakthrough.

This Market Is Different

Stocks & Mutual Fund