In the past 30 years the following has occurred:
1995-2000: Dot-com bubble
1997: Asian financial crisis
1998: Russian default and LTCM collapse
2000-2002: Dot-com bust (S&P -50% and Nasdaq -83%), 9/11, Enron/WorldCom scandals
2003: Iraq War
2007-2009: Great Financial Crisis, housing prices collapse 26%, U.S. stock market falls 56%, Bernie Madoff Ponzi Scheme outed
2009-2012: European Debt Crisis
2013: Taper Tantrum
2016: Brexit
2018-2019: U.S.-China Trade War
2020: Global pandemic, oil prices go negative
2021-2022: Supply chain shock, Russia-Ukraine war, 9% inflation, rates spike
2025: Liberation Day
This list could go on and on. There’s plenty of other stuff that happened that I missed.
Despite all of this, the S&P 500 returned 10.4% per year:
The 1960s, 1970s and 1980s were no picnic either. Yet the previous 30 years saw annual returns of 10.6% per year.
A lot of really bad stuff happened in the 1930s and 1940s. That’s two of the worst decades in modern history. The stock market was up more than 12% per year in the 30 years from the summer of 1935 through the summer of 1965.
A lot of bad stuff will happen again. I can guarantee it.
I don’t know when and I don’t know why but there will be crashes, recessions, financial crises, war, geopolitical upheaval, and more.
And I still invest in the stock market.
Why?
Bad things happen and life goes on.
People wake up every day looking to better their place in life.
Corporations are constantly looking for ways to make more money.
The stock market is the only place where anyone can invest in human ingenuity.
I’ll take that bet even if there will surely be setbacks along the way.
Further Reading:
31 Years of Stock Market Returns
