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You Know We Are In A Bull Market?

1/15/2018
“You know we are in a bull market?” One of my favorite quips that originally came from “Reminiscences of a Stock Operator” originally published in 1923. The statement by Old Turkey was the backdrop for the answer to whatever question a young gun was asking. I have used this to preview our quarterly and annual calls since May of 2013 when the market first closed about the high of the 1982-2000 Bull market. That is how I mark it the beginning of this Bull Market.

Essentially the market was rangebound for 14 years before the May 2013 breakout. These rangebound periods are usually followed by a Bull Market, that on average lasts 15-16 years. So, whether you mark the beginning at the low in 2009 or the breakout in 2013, there is still time left in this Bull Market.

Most of us will see three Bull Markets in our lifetime. My first, had just begun before my employment in the brokerage business began in 1984. Often as was my case, the first Bull we don’t have sufficient capital to take advantage of. The second, we are most suited for is the present market. The 3rd we are often too old to take on the risk.

The current market is often criticized for being expensive on Price Earnings ratio. The tax legislation has taken care of that by lowering the tax brackets we have set up companies with billions of dollars of cash that will be deployed to shareholders or reinvested for growth. My hope is that it is reinvested, and we see a capital spending cycle.

We are currently seeing the most synchronized global expansion since the mid 90’s. There are no flaws yet in this bull market. Stay tuned!