H.O.P.E. Hold On, Pain Ends

May 22, 2020
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While no two events are the same, history has an ability to put events into context and place a perspective on current situations.     The Corona / Covid-19 crisis has brought uncertainty to our personal lives as well as stock market.   The stock market loathes uncertainty and has reacted with drastic swings and losses since the spread of the virus began mid-February.   As recently as Valentine’s Day, investing may not have been something we gave much thought too.   We contributed through our payroll deductions or regular bank drafts and overall it was a bit of an after-thought.  Recently, investors may be feeling concern and fear.     

History shows us that every year there has been a domestic or worldwide event that has provided a reason not to invest.   When I meet with investors and I show this chart, the comment I often hear is “I wish I would have been in the market then” and name your time and event.   

I can’t predict how long this will last and how deep it may go.    Recently I am hearing “the USA is about 50 days behind China’s Covid-19 timeline.”   50 days from today puts us at May 5th.   My hope in writing this blog is to provide you a historical perspective that “this too shall pass.”   If you have questions or concerns, please call or email.   I am here to help. 

Every year there has been a reason not to invest:

1934

Depression

1963

Kennedy Assassination

1992

Los Angeles riots

1935

Civil War in Spain

1964

Gulf of Tonkin

1993

Midwestern U.S. floods

1936

Economy still struggling

1965

Civil rights marches

1994 

Fed raises interest rates 6 times

1937

Recession

1966

Vietnam War escalates

1995

Dow tops 4000, then 5000- market “too high”

1938

War clouds gather

1967

Newark riots

1996 

Technology stocks tumble

1939

War in Europe

1968

North Korea captures USS Pueblo

1997

Chaos in Asian markets

1940

France falls

1969

Money tightens; market falls

1998

Global economic turmoil

1941

Pearl Harbor

1970

U.S. invades Cambodia

1999

Fears of Y2K computer problems

1942

Wartime price controls

1971

Wage-price freeze

2000

Internet bubble bursts

1943

Industry mobilizes

1972

Watergate

2001

Terrorist attacks in U.S.

1944

Consumer goods shortage

1973

Oil embargo

2002

Corporate accounting scandals

1945

Post-war recession predicted

1974

Nixon resigns

2003

U.S. invades Iraq

1946

Dow tops 200 – market “too high”

1975

U.S. withdrawals from Vietnam

2004

Oil prices soar

1947

Cold War begins

1976

New York City threatens bankruptcy

2005

Hurricanes devastate southern U.S.

1948

Berlin blockade

1977

Energy crisis

2006

Dow Jones tops 12,000 for the first time

1949

Soviets detonate A-bomb

1978

Massacres in Cambodia

2007

Subprime credit crisis

1950

Korean War

1979

Three Mile Island nuclear accident

2008

U.S. recession

1951

Excess profits tax

1980

Abscam scandal rocks Congress

2009

U.S. unemployment tops 10%

1952

U.S. seizes steel mills

1981

Reagan & the people are shot

2010

Gulf of Mexico oil spill

1953

Soviets detonate H-bomb

1982

Worst recession in 40 years

2011

European sovereign debt crisis

1954

Dow tops 300 – market “too high”

1983

Soviets shoot down a Korean airliner

2012

U.S. faces “fiscal cliff”

1955

Eisenhower illness

1984

Iran-Iraq war escalates

2013

5th Yr. of fed. govt’s quantitative easing policy

1956

Suez Crisis

1985

U.S. becomes a debtor nation

2014

U.S. drawn into Syrian conflict

1957

Soviets launch Sputnik

1986

U.S. bombs Libya

2015

Greek debt crisis, China growth slows

1958

Recession

1987

Record-setting market declines

2016

Wave of populism affects elections around world

1959

Castro seizes power in Cuba

1988

Bank failures peak

2017

Hurricanes pummel the U.S. & Caribbean

1960

Soviets down U-2 plane

1989

Problems with junk bonds

2018

U.S. trade war with China

1961

Berlin Wall is erected

1990

Iraq invades Kuwait

 

 

1962

Cuban Missile Crisis

1991

Recession in U.S.; Soviet Union dissolves

 

 

 

Disclosures: “1934-2018 Reason not to Invest” chart provided by Capital Management.   Investing involves risk, including loss of principal. Content in this material is for general information and is not intended to provide specific advice or recommendations for any individual.   All performance referenced is historical and is no guarantee of future results.   All indices are unmanaged and many not be invested into directly.   No strategy assures success or protects against loss.