The chart had a large draw-down from 1973 to its bottom in late 1974. Throughout the decade, there were many corrections, but over time the markets actually appreciated. I'm sure many investor's fled the markets looking for safer returns. Problem is, this is what followed:
The 1980's were a great period for investing. The first few years were tough, but by 1983 until 1987, the markets moved vertically. Even the crash of 1987 was recovered quickly and new highs were achieved. The following ten years continued this streak:
This is what we call a parabolic move to the upside. The roaring 1990's. WOW. The markets appreciated over 300%. There were a few corrections, but if you were a long term investor, you were happily rewarded! Then this happened:
The 2000's, are very similar to the 1970s, but even WORSE. We didn't appreciate at all. Today, it's all about seeking risk-adjusted returns. As an investor, I would look beyond the next year. If you have a long term investing future greater than 10 years, you need to be long the equity markets. Here is a chart from 1970 to 2010:
Don't miss the next 1980's and 1990's!!!