Chart shows today mirrors 1966-1982

John Ransom

4/29/2011 8:05:15 AM - John Ransom
The trendline on the S&P would suggest that the market is entering a period not unlike that from 1971 to 1973 when the market attempted to break above the trend, but instead traded sideways for the next 9 years. 

Interestingly, even after the market enjoyed an historic bull run in the 1980s, the S&P didn't break well above the trend until 1994. 

The chart puts in perspective the long range nature of how markets react to events. Rather than being drivers of events, the markets are just reflections of things that are going on in society at large. 

The period from 1966 to 1982 is a good exmaple of that. It looks like the economy was on drugs during that period, until the recovery began when it just said "no." The drug of choice of course was dollars and government spending.   

Looking at a longer term perspective, it's a very good time to be investing in stocks if your investment horizon is 10-20 years or more. 

Of course invetsing in stocks would give you extra incentive to give Obama the boot too.     

(Source: Barry Ritholtz