The Nine-Month Idiot Maker Rally Won't Be Followed By Another One

 

This chart shows nine-month returns for the S&P 500 from Bespoke Investment Group.  It makes it pretty clear that we’ve just experienced the most spectacular periods for stocks since… yes… 1933.

 

Whether an idiot-maker, or idiot-made, equity holders made a ton of money, proving that, once again, when everyone is ultra-bearish, it’s time to buy. Even if the world is full of massive uncertainty.

Bespoke: Also, the 9-month 62% gain was preceded by a 9-month decline of 51%. The only time that the index fell more over a 9-month period was in 1931/32 when it dropped 68%. It’s easy to forget how crazy things were over the last 18 months, but stats like these provide a staggering refresher.
[image url="http://static.businessinsider.com/image/4b221d0700000000006a76a3/image.jpg" link="lightbox" caption="" source="" alt="idiot" align="left" size="xlarge" nocrop="true" clear="true"]
Yet at the same time, it’s highly improbable that the next nine-months will be able to beat what we just experienced. Thus this chart provides fuel for today’s bears as well — it’s obvious that after any huge run, there comes an inevitable correction.

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.