For one of the most complex “engines” on earth—the S&P 500—there is a way to get under the hood, look at the condition of the engine yourself, and independently verify what the experts are telling you.
However, all too often, many of us (even in the investment business) lift the hood, glance around, and make diagnoses a little too quickly, missing important details. Take a look at the chart below of the S&P 500 over the past five years and all you see is bull market...
If it looks like a bull, snorts and paws like a bull, and charges like a bull, it is a bull. And this is a bull market.
Absolutely, no doubt about it. It is one of the great bull runs in history—already 5 ¼ years old. On March 6, 2009, the S&P 500 was 676.53; on May 31, 2014, it was 1923.57. Total price appreciation: +284%. Compounded annual price appreciation: +22%!
If you could package an antidote to financial fear it would look like... a bar of gold.
For those who fear future inflation; for those who fear paper money is not worth the paper it’s printed on; for those who fear debt defaults; for those who fear political unrest – the ultimate security is a gold bar. Many gold fans believe money should be backed by gold. Gold itself is always backed by fear.