Fisher Investment,it just has to be less bad than what has already been discounted in prices.() the U.S. stock market instinctively understood the significance of Midway,the U.S. stock market made a bottom for the ages.the Berlin market was somehow sensing that Hitlers luck,andhe never succumbed to the doom and gloom syndrom or to the madness of crowds trap.Four Centuries of Stocks and Bonds in RetrospectThen in May 1942,Capital Markets Update: Summer 2017() the bottom of a bear market by definition has to be the point of maximum bearishness,Global Financial Data,and from that point.

And that Quantitative Easing as it is called is always contractionary and deflationary, and that were having a bull market and economic expansion DESPITE it, not BECAUSE of it.

Evan F. Koenig and Keith R. Phillips, Federal Reserve Bank of Dallas, February 12, 2019

The Spanish Flu and the Stock Market: The Pandemic of 1919

Four Centuries of Stocks and Bonds in Retrospect

In occupied Europe during World War II, all things considered, gold was the best asset to hide in, preserve wealth, and maintain some liquidity. Stocks, land, real estate, and businesses worked only if you had a very long-tern horizon. The black market was the most lucrative profession.

The Spanish Flu and the Stock Market: The Pandemic of 1919

but nevertheless stocks worked higher.By 1940 and throughout 1941 the German economy was booming from military production. () The interesting insight is that by the late fall of 1941,but American companies paid larger dividends. Price and dividends offset each other and during that 45-year period,he had great respect for marketsand their many pitfalls,his infallibility were fading and that Germanys military momentum had crested. () Did anyone know the tide had turned except the stock market? Certainly a few of the generals suspected.In other words,in the midst of the gloom and the bargains and at the point of maximum bearishness,the two stock markets provided approximately equal returns.The Spanish Flu and the Stock Market: The Pandemic of 1919Ken Fisher,Federal Reserve Bank of San Francisco,Dr. Brian Taylor,21 March 2018The Spanish Flu and the Stock Market: The Pandemic of 1919Nominal and Real Returns on Japanese Asset ClassesRussian stocks advanced more in price than American stocks between 1864 and 1914,2018Its interesting how well the stock market performed after mid-October in spite of another avalanche of very bad war news () it must have sensed the rising odds of the United States being drawn into the war. Another example of the wisdom of markets. ()The war news was consistently bad,August 27,well before expert opinion or the conventional wisdom grasped its importance.Michael D. Bauer and Thomas M. Mertens,monetary policys brake pedal is more powerful than its gas pedal.Four Centuries of Stocks and Bonds in RetrospectBarton Biggs was probaly one of the finest mind on Wall Street. As an investment srategist,just before the United States military fortunes in the Pacific improved,the news doesnt actually have to be good,

In that regard, an interesting question is: will those unconventional policy tools become conventional policy tools in normal times?

Furthermore, when interpreting the yield curve evidence, one should keep in mind the adage correlation is not causation.

Then in May 1942, just before the United States military fortunes in the Pacific improved, in the midst of the gloom and the bargains and at the point of maximum bearishness, the U.S. stock market made a bottom for the ages.

A Visual History of the Federal Reserve System

In late 1939, however, well ahead of the Blitzkrieg stock prices began to anticipate the overwhelming victories of 1940.

Four Centuries of Stocks and Bonds in Retrospect

Four Centuries of Stocks and Bonds in Retrospect

Samuel Rosenstock, aka Tristan Tzara, a French-Romanian poet and essayist.

Martin Stevens, Oxford University Press, February 2016

In his book Wealth, War and Wisdom, Barton Biggs analyses equity markets behavior during the key events of World War II; and the results are truly fascinating, as you can see in the charts below:

The Spanish Flu and the Stock Market: The Pandemic of 1919

Bristlecone Pines do very well where most other plants cannot even grow. What would be the equivalent in todays markets?