David Fleer
Bristlecone Value Partners, LLC
12301 Wilshire Blvd., Suite 320
Los Angeles, CA 90025 USA
Work 1-877-806-4141

“Plus ça change, plus c’est la même chose”

March 21st, 2014

March 9th marked the 5-year anniversary of the absolute low for the US stock market during the financial crisis: The S&P 500 bottomed out on March 9th, 2009. What is interesting to us is to go back in time, peek in the rear view mirror and look at 5- year returns from March 9, 2004 through March 9, 2009: Chart 1

Bonds came out on top, while the other 4 categories experienced a horrific 5 year decline. US Stocks and Real Estate investments experienced a drop that had not been seen since the 1930’s Great Depression. Do you remember how you felt back in March 2009? The average investor did not want anything to do with stocks or real estate. Everybody wanted bonds.

Let’s take a look at how different asset classes have performed since March 9, 2009 through March 9, 2014: Chart 2

It’s pretty much the exact opposite of the first table with the prior 2 worst categories finishing on top by far: US Real Estate has tripled, and US Stocks are not that far behind. US Bonds are near the bottom.  As illustrated in a Wall Street Journal article “The Bull That Got Away” (registration required), today’s investors want more stocks in their portfolio, because they feel left behind. Once again, most people make investing decisions by looking in the rear view mirror. The more things change, the more they stay the same. Read the rest of this entry »

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