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Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

fortune.com

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Re: Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

#191

Post by dkrich »

Saying the market was "flat" between 66 and 82 is a ridiculous oversimplification.

There was a pretty strong bull market leading into 1973 which then began the worst bear market since the great depression, lasting until November of 1974.

Then the market bounced and a strong bull market ensued. Net inflation and price over a long period one could argue the market was flat or down, sure, but on a year-to-year basis to argue there was no money to be made or lost holding stocks during this period is just wrong.

If you were clever enough to get out of the market early in the 73-74 bear market and then get in relatively early after the November of 74 rebound, you'd have certainly had good returns. If you think that's just hindsight and nobody could've done that, read Marty Zweig's Winning on Wall Street where he has a section entirely devoted to that period and how he did avoid most of the drawdown.

Re: Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

#192

Post by 01100011 »

lexapro wrote: post #73
daniel-cussen wrote: post #56

Earlier quoted context omitted.

You shouldn't read those headlines. Both the ones walking you off a cliff in increasingly devious ways the interviews with Warren Buffett saying buy and hold which is a pessimal strategy, and the headlines announcing x happened because y as if you should think y leads x. It did not, they don't know that, news blogs get a pass in telling people false causes after the fact, dude it's purely made up and it's a guessing…

Why is buy and hold a "pessimal strategy"?

IDK what OP believes, but to me, the "Boglehead" strategy is great, with giant caveats.

Most devotees I talk to get visibly frustrated when I suggest that you can look at larger macroeconomic forces, like COVID, supply chain issues, Fed manipulations(both positive and negative) and make educated predictions on the direction of stocks. My guess is that these are folks who just don't want the frustration of learning about these things, and I get that. It is a significant cognitive load to maintain an understanding and awareness of market influencing factors.

I use a family member as an example who was told by their money manager to move to cash at the beginning of the year. That wasn't just dumb luck. Was it a sure bet? Nothing is in this world. Do you bring a winter coat to a July outdoor event in Phoenix? I mean, it could be cold, right? But yet the writing was on the wall for the direction equities and bonds would take this year.

Can you perfectly time the bottom? No. It's also important not to be too conservative. The majority of gains in a stock market cycle are made in the first sprint out of the gate when everyone is still fearful. But you can know when things are peaking and GTFO before the slide. You don't need to be Michael Burry to spot these things either. You just need to not watch CNBC and Cramer or any of the other paid shills.

Re: Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

#193

Post by [deleted] »

foobarian wrote: post #88
coldcode wrote: post #81

Earlier quoted context omitted.

I read a lot of these type of predictions, often you see some people say it's a great time to buy, and others it's a bad time to buy, and generally you will only remember the people who guessed correctly, so none of this helps you today at all. Every time those people who got lucky will appear in some future ad or article making a new prediction, and generally fewer will be lucky twice. In the long run, everyone is l…

Your comment makes me realize that in the medium term, after most of the unlucky predictors drop off, you are statistically likely to be left with a few really lucky ones (i.e. if a thousand people are tossing coins, you're likely to get one guy with a streak of 10 heads), and these individuals are perfect to put on pedestals as rare and brilliant talents.

[deleted]

Re: Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

#194

Post by steveBK123 »

llampx wrote: post #170
bidirectional wrote: post #156

Earlier quoted context omitted.

Ackman said hell was coming, was appropriately hedged using instruments which would appreciate when hell did indeed come, and made $2bn on his hedge which offset the losses in his equity positions. He didn't net profit $2bn.

He appeared on TV crying while his firm was unrolling their hedges and buying stock for the rebound. Never trust media.

its called "talking your book"

Re: Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

#195

Post by cypress66 »

2OEH8eoCRo0 wrote: post #39
jxf wrote: post #15

> “There’s a high probability in my mind that the market, at best, is going to be kind of flat for 10 years, sort of like this ’66 to ’82 time period,” he said in an interview with Alex Karp, CEO of software and A.I. firm Palantir. Adjusting for inflation, the stock market was not "flat" during this period [0]. The DJIA, for example, closed at an effective price of 9,160.41 in January 1966 and closed at an effective…

What about S&P 500? The Dow Jones Industrial Average indexes a mere 30 companies.

Not just that, but weighed by their nominal price which is insane.

Re: Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

#196

Post by tootie »

svachalek wrote: post #169
tootie wrote: post #151

Earlier quoted context omitted.

A lot of the adjectives that traders use are different from how casuals would interpret things. They are looking for massive profit opportunities and declare hell on earth when they aren't there because it is for them. People who are just putting 401K money into index funds just need their money to slightly outpace inflation which it will almost always do in a long enough time horizon. We saw an outsize bull market a…

"Nearly guaranteed" may be a stretch. There are decades in US history where you wouldn't really come out ahead (although I'm not sure any alternatives to stock would have done better) but internationally, there are many clear examples where the stock market hasn't been a good investment on a generational basis, like Japan now. The question is how much do you believe in American exceptionalism, are US markets really i…

There's an awesome website posted to HN a while back that calculates total real returns (accounting for dividends and inflation). Here's the chart for the Vanguard S&P500 index fund:

https://totalrealreturns.com/s/VFINX

Re: Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

#197

Post by zackmorris »

Investment in general.

After the global awakening, the rest of the world doesn't want to do our work for pennies on the dollar anymore.

For example, Apple won't be able to enjoy high profits on the back of indentured servants at Foxconn. Marketplaces like app stores and Amazon won't be able to skim such high percentages from the people doing the actual work of making and shipping things. Even portals like Google will find that their best efforts can't keep up with the dizzying pace of technological improvements in areas like machine learning as tech becomes more and more democratized.

I have a question about this: I perceive profit as theft because I've spent my life working for employers for pennies on the dollar too. I'm averse towards investing because I don't want to use people. What's a "fair" return on investment? 5%? 10%? Or is investment inherently usurious? I'm concerned that my unwillingness to invest could end up being a burden on Millennials and Gen Z, the same way that the Boomers refusing to invest in Gen X caused us many lost decades. Your experience may not have been like mine, but trust me, the proletariat/plebeians/paupers of the world are wrestling with this as one of the central issues this century. Can we have capitalism without exploitation, and if so, how will we accomplish that?

Re: Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

#198

Post by chasd00 »

recursivedoubts wrote: post #26
apples_oranges wrote: post #23

I, a random anon from the Internet, think SP500 is heading for 2400 or even lower (1600ish?), which is great news, as millenials will get a chance to buy stocks at a low price.

looking at the pullbacks in 2000 and 2008, there is a non-trivial chance that the S&P will bottom sub-1000

Do you remember the financial crisis? In 2008 Paulson was literally on his knees in front of Pelosi begging for congress to do something. I doubt we're headed there again.

Re: Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

#199

Post by deehouie »

fny wrote: post #116
deehouie wrote: post #99

Earlier quoted context omitted.

This is the best comment in all. HN folks don't understand the purpose of this article. You think Druckenmiller is so bearish? for the next 30 yrs? Not a chance. He must have a huge short position on the S&P500, and he likes you to sell your stocks so he could cover at a lower level.

Nah. Druck isn't one of those types. Bill Ackman is. Druck is just known to change his opinion when the facts change or he comes to a new conclusion. There's some anecdote about him completely flipping on a position when going in and out on an elevator ride that I can't quite remember. By the way, sideways means that the stock market is going nowhere long or short. IMO, currencies and commodities are a far better pla…

While you may know the guy better, notice this Druck comment comes at a time when the long term buy-and-hold thinking is at its weakest point. A slightly respectable guru saying this sort of things is enough to make some people sell.

Re: Stanley Druckenmiller warns the stock market will be ‘flat’ for an entire decade

#200

Post by 8jef »

_he has a history of a _bearish bias_ that he has had to work around his whole career. _I like darkness_ he said._

Well, that's the only way to win long term at playing that game. Buy very very low and sit on it. It helps if you already have money. The bear feeds on the bull. Never be the bull.

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