As every “crash” happens, investors invariably tell themselves the same thing… “this time its different”. The truth is that unless you genuinely believe that capitalism, globally is dead, then nothing is different. Yes, there are things wrong with capitalism, but if its basic premise is to raise money so that companies and organisations can create and meet the needs of real people in different markets, that creates jobs, wealth and share profits and therefore prosperity. If you don’t believe that, then you really should not be investing in anything at all.
I am not pretending that there is not, or will not be some significant difficulties and hardship around the world as a result of the pandemic and crisis of confidence in markets, but it will return, it is a question of when, not if.
BULL and BEAR
This in mind, Vanguard produced a rather helpful chart this morning which I wanted to share with you. This shows the Bull and Bear runs of the FTSE AllShare Index. Note the falls and the durations of the respective “runs”. I have put the pdf of this below. This shows total returns, so includes the income (dividends) from shares. This takes a long-term view, since 1900. So before all of us were alive, through two world wars and unspeakable things that man does to man. Will we ever learn? Here is another opportunity for you as an investor to do so. Do not panic, this will pass.
In the office we have a sculpture by Linda Hoyle of a bull and bear that I commissioned (sounds fancy, but it wasn’t). This is in our reception and is a reminder that both are ever present, battling for the upper hand. There is opportunity in both. You can find Linda’s work here.
Download the pdf: Solomon’s Bull and Bear Markets
You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email email@example.com