ltsdd talked about the period of time it takes for the market to recover lost ground – I would call this a “bathtub” period…things go down (to the bottom of the bathtub) then recover.
If you look at the microtrends data in the last 50+ years, there were the following bathtubs and pure growth (not in a bathtub) periods:
Bathtub: 1/1966 – 8/1967 (1 yr 8 mo)
Pure G: 8/1967 – 1/1969 (1 yr 4 mo)
Bathtub: 1/1969 – 4/1971 (2 yr 3 mo)
Pure G: 4/1971 – 12/1972 (1 yr 8 mo)
Bathtub: 12/1972 – 6/1980 (7 yr 7 mo)
Pure G: 6/1980 – 11/1980 (5 mo)
Bathtub: 11/1980 – 1/1983 (2 yr 2 mo)
Pure G: 1/1983 – 11/1983 (11 mo)
Bathtub: 11/1983 – 8/1984 (10 mo)
Pure G: 8/1984 – 9/1987 (3 yr 10 mo) (hit Black Friday)
Bathtub: 9/1987 – 5/1989 (1 yr 8 mo)
Pure G: 5/1989 – 8/2000 (11 yr 3 mo) (hit tech bubble)
Bathtub: 8/2000 – 10/2007 (7 yr 2 mo)
Pure G: 10/2007 – 10/2007 (1 mo) (hit housing bubble)
Bathtub: 10/2007 – 4/2013 (5 yr 5 mo)
Pure G: 4/2013 – present (4 yr 9 mo and growing)
So technically ltsdd is right – no bathtub over 10 years. BUT the last two bathtubs had only 1 month in between so they felt like one big 12 year bathtub!
That is why this has been a no joy recovery.
Another thing that appears to be happening: since they instituted the circuit breakers (after 1987) to keep the market from tanking from panic, the cycles appear to have lengthened by a considerable amount. Not sure if I have the cause and effect right, but it sure appears that way.
