Some might look at this chart and say that it has been so long (12 years) since we have had any long term up trend in stocks, that this is a good time to buy.
Others might look at the chart and say that, since the economy has not seen fundamental improvement in the last fifteen years or so, there is no reason for stocks to go higher and that anytime the S&P 500 gets up around 1400 is a good time to reduce exposure and that anytime it approaches 800 is a good time to increase exposure. These are folks who remember that the Japanese market topped out at the end of 1989 and is now only about 25% of the value achieved at that time.
Some react just based on the current situation and tend to get excited and buy when the market is high and financial page headlines are trumpeting the new levels. They get really excited if such news stories break out of the financial section and show up on the front page. These are the same folks who get depressed and sell when the market is reaching new lows. It is that old "buy high, sell low" strategy. It seldom works to the benefit of the investor.
Whichever approach we choose, most of us have about a 50% chance of being right. Really smart and well-informed investors can increase the odds to a bit above 50%. Lucky investors hit the jackpot. Unlucky ones go broke.
I'm not giving any investment advice, but careful consideration of a long-term picture such as this one can help one have more realistic expectations.
And that little bar chart at the bottom is volume, number of shares traded. I think such an incredible increase in volume has been enabled only by internet access and on-line trading.
Here is a key point not to be overlooked. Those who consistently and steadily invested in a broad spectrum of US stocks over this entire 32 year time period, always resisting temptation to bail out in the bad times, have been quite successful.
As for the next 32 years, who knows?
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