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Mon Sep 26, 2022, 05:30 PM

When will we get back to Dow 36000?

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11 votes, 2 passes | Time left: Unlimited
1 year
4 (36%)
2 years
2 (18%)
5 years
3 (27%)
10 years
1 (9%)
Never!
1 (9%)
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9 replies, 1072 views

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Response to Shermann (Original post)

Mon Sep 26, 2022, 06:34 PM

1. If you want a rapid rise back up, one of two things has to happen

Either there is a huge cash infusion to the people who need it least or the dollar will take a dive on world currency markets, making US stocks look cheap to overseas institutional investors.

I don't see either happening any time soon. I don't know if the market has bottomed out for now, but I do expect to see the Dow above 30K sooner rather than later, but that's just me. There are only so many places for the guys who pocketed $$ at the relative top of the market to put the cash now that it's lower.

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Response to Warpy (Reply #1)

Mon Sep 26, 2022, 06:42 PM

3. There doesn't seem to be a consensus on whether the US is in recession or not

There could be a turnaround if this is deemed to be a "false recession". But I think a one-year recovery might be very optimistic to make that all back. The inflation boogeyman is still lurking by the clothesline.

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Response to Shermann (Reply #3)

Mon Sep 26, 2022, 07:05 PM

6. Just like the stock market didn't represent the whole economy when it was up

it doesn't represent the whole economy when it is on a slide back into realistic territory.

What remains to be seen is what happens to energy prices this winter, something that remains to be seen depending on how much trouble central Europe is in and Putin prefers to burn money rather than open the pipelines. We'll see how long he gets away with it.

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Response to Shermann (Original post)

Mon Sep 26, 2022, 06:41 PM

2. Stocks are one of the few things people don't want

When they are on sale. I think it was about six years for the market to get back to it's 2008 level. That was an over 40% drop. So that gives you a yardstick.
Of course it took the Dow till the early 1950s to reach the 1929 peak. Probably won't take that long.

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Response to Shermann (Original post)

Mon Sep 26, 2022, 06:51 PM

4. Option not listed: less than a year

Go back and look at all the historic crashes and corrections, and how long it took them to regain lost ground.

With the exception of 1929 and possibly 2008, all other corrections regained losses within a year or less.

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Response to Fiendish Thingy (Reply #4)

Mon Sep 26, 2022, 07:35 PM

7. Since 2000, the S&P 500 has taken an average of 647 trading days

...after the United States exited a recession to reach pre-recession levels.

https://www.fool.com/research/stock-performance-recessions/

So, 2 or 3 years is my guess.

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Response to Shermann (Reply #7)

Mon Sep 26, 2022, 07:50 PM

8. That's not an accurate description of the bigger picture

https://www.guggenheiminvestments.com/mutual-funds/resources/crucial-conversations/putting-pullbacks-in-perspective

We can gain important perspective on market pullbacks by considering post-World War II declines in the S&P 500® Index. The majority of declines fall within the 5-10 percent range with an average recovery time of approximately one month, while declines between 10-20 percent have an average recovery period of approximately four months. Pullbacks within these ranges are not uncommon, occurring frequently during the normal market cycle. While they can be emotionally unnerving, they will not generally undermine a well-diversified portfolio and are not necessarily signals for panic. Even more severe pullbacks of 20-40 percent have registered an average recovery period of only 13.8 months.

In contrast, pullbacks of 40 percent or more, while occurring much less frequently, post an average recovery time of 58 months and can potentially compromise an investor’s financial plan. Pullbacks above 20 percent (including all pullbacks above 40 percent), which have registered the longest recovery periods, have been associated with economic recessions. When evaluating a market pullback, the probability of a recession is a key insight to consider when determining whether or not to reduce equity exposure.

While recessions are readily identifiable in hindsight, prospectively they can be difficult to spot. This makes access to reliable market analysis all the more important when determining the probability of a recession.


So far this year, the Dow has shed 23%, the S&P -21%

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Response to Fiendish Thingy (Reply #8)

Tue Sep 27, 2022, 04:21 PM

9. "Bigger picture" just means averaging in older data

Why would historical data prior to 2000 be a better indicator of where today's markets will go?

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Response to Shermann (Original post)

Mon Sep 26, 2022, 07:05 PM

5. How about Thursday since we are all wishing.

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