Dec 17, 2008

Ken Fisher on comparisons to the 1929-1932 bear market and limited downside (2008)

This is not 1929-1932. The fact that people say it's like 1929-1932 is actually bullish. That is, that's regularly trotted out about every third bear market. And, the fact of the matter is, bear markets - I mean we're not in a 1929-1932 world; we're in a very different world. After every bear market there's a bull market. And this is the time - since no one can tell exactly when the bottom will be - this is the time to be thinking longer term about where stocks will be two or three years from now. And the fact is two or three years from now they ought to be pretty good.

There is no doubt, you could see the market down before it goes up. But my point is the bottom of bear markets is a very short time period with a steep "V," and you can't time the bottom of that with any precision. Anybody who thinks he can is an overconfident fool. And the fact is, you gotta be in it to win it. And you might lose it before you win it. But you gotta remember, that the next bull market is huge compared to any downside from here.

~ Ken Fisher, Fisher Investments, "Ken Fisher touts 'road to riches' despite meltdown,", October 10, 2008, interview with Steve Gelsi

(Fisher, 57, who went to Humboldt State University to study forestry and graduated with a degree in economics, said the current credit crisis could be eased considerably with better monetary policy.

The U.S. Federal Reserve under Ben Bernanke should consider dropping its discount rate so it's lower than both the Federal Funds Rate and the rate on Treasurys, he said. Together with a drop in reserve requirements for banks, the measures would help free up lending, he said.)

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