What does a drop in the market have to do with a bear market?
Is it really predictive of anything?
As soon as the market drops, the pundits come out in force.
They peer into their crystal balls and confidently predict the future.
Most of their predictions are doom and gloom, because fear and anxiety are easy to peddle.
It’s a lot of noise. Ignore it.
No one can accurately and reliably predict the direction of the market.
There have been many times in the history of the market when the monthly return of the S&P 500 index dropped by more than 5%.
On average, the return of the index over the next 6 months was over 15%.
The return over the next 12 months was over 25%.
If the index drops by 5% or more next month, the market may take off or tank.
I have no idea which direction it’s headed.
But at least I admit it.