In his Daily Telegraph column entitled, "Just Because We've Lost a Decade Doesn't Mean We Should Lose Heart," Tom Stevenson writes:
Investors considering whether today's stock market represents an attractive
long-term buying opportunity face a similar dilemma. As we are constantly
told, past performance is no guide to the future, and in the short term it
plainly is not. But over the longer term, past performance is apparently a
very good guide indeed. Investment feast invariably follows investment
famine and betting that way makes instinctive sense.
Further down he wonders whether we're headed for a long awful patch like Japan suffered:
I think we are not for two reasons. First, because the policy response to the
property and banking crisis has been so different from the way in which the
Japanese authorities mishandled the bursting of their own bubble through the
1990s. The lessons learnt make a repeat unlikely. Second, because my
analysis of the past 108 years suggests that betting against a decent
performance from here is a very long shot indeed.
Comments