“To separate wheat from chaff is a vital function amid the signs of the times. It is a fact that no two bear or bull markets are exactly the same in their manifestations. This is why a single investment software package is of limited use. Software, unlike the human mind, can only compare present models to those in the past, usually almost exactly. And, though we may have a future bear market as inflationary as those in the 1970s, or as economically devastating as the 1930s, or any in-between, the only certainty is that any future bear market will not look exactly like any in the past, though it will doubtless have elements of past markets.”— Harry D. Schultz
A reverberating message throughout 2022 has been that *this year is just like 2008*. Much to my chagrin, this message is so prevalent that I’m sure a handful of retail investors misconstrue it to be actionable information. Now, I am not going to make this the scolding Olympics despite the staggering number of comparisons between the 2 that I’ve seen in recent months (if I did, it’d be warranted). Rather, I’ll simply raise a question. What benefit does anyone receive from falling in love with any comparison?
Here’s another example.
Again, I’m not writing this in an attempt to chastise either of these two. I simply believe it would be wise to reconsider this approach to the markets.
2022 is not 2008 for several obvious reasons. It is not 1929, 1973, 2000, or 2008. This is arguably the most tumultuous geopolitical & economic environment in history. We are in unprecedented territory right now, and this remains true going into 2023. There are obviously similarities between each of the aforementioned years, but they are all simultaneously much different.
The “imminent deflationary bust, this is 2008” crew is inducing secondhand embarrassment in me at this point. One look at my previous post, and the reason is transpicuous. I’ll end this with a sincere friendly reminder.
Please don’t miss the forest for the trees because of your obstinance. Unwavering adherence to your own ideas despite facing incontrovertible proof that they are not cogent is an inauspicious mindset for anyone in any field. Prevention is much better than cure, especially in this instance. One either adopts a dynamic mindset or gets washed away.