Season 3, Episode 1: WTF is a Bull Market?

Why a thriving stock market means we can high five, but not bring out the cocaine

Warning: There will be no champagne party in this episode. Last year it was the Bear Market, now it’s the Bull Market. The market goes down, the market comes back up. And no matter what, Sara says we have to be super chill and nonchalant-like, even when things are good. Also, Sara describes what an economist victory lap looks like (dorky, but kind of bad ass) and why we need to keep plugging away at our plan, no matter what historical dips and historical climbs happen to be happening in the stock market. Will there ever be alarmist advice on this podcast??

Come for the reasonable amount of drinks at a very sensible, if muted, celebration. Stay for Sara fangirling over a famous female economist I’ve never heard of. It’s Season 3, bitches!

Ask us your dumb investing and finance questions for Season 3 on our Ask Us page!

We have the social medias!! Here’s our Instagram and Facebook and LinkedIn.

This episode was edited by our co-producer Kelly West. Music by Bad Bad Hats and Devmo.

Transcript for Season 3, Episode 1: WTF is a Bull Market?

Caitlin [00:00:07] Welcome to Women on the Verge of a Financial Breakthrough, a podcast where we're figuring out finance. One dumb question at a time. I'm the dummy. Caitlin Meredith, a coach and mediator based in the Bay Area.

Sara [00:00:20] And I'm Sara Glakas. I'm an investor, advisor and founder of Blackburn Financial and the Austin Women's Investing Group, which can be found on Meetup and Facebook. Before we start, do you know a woman who might be on the verge of a financial breakthrough? Will you text her a link to our show? Also, if you can, please leave us a review. This helps other women on the verge find us, and we read all of them and they make us happy. Cry like this one from a listener who said, this makes me feel knowledgeable and motivated to take one more step towards my financial future. I'm even educating my husband now with all this knowledge and it feels empowering. Such a wonderful resource. Please come back. Well, lucky for you, we're back with season three. Thank you for leaving the review and now let's get started.

Caitlin [00:01:14] Okay, Sara, we have gathered here today to talk about. Wait, the bull market or the bear market?

Sara [00:01:21] Yeah, the bull market.

Caitlin [00:01:22] The bull market. Because last summer or two summers ago.

Sara [00:01:27] Two summers ago, like July of 2022.

Caitlin [00:01:29] We were ankle deep, knee deep, armpit deep in a bear market. And we had a little mini series of three about what does that even mean? What should we do about it? If anything? The answer, as usual, was nothing. And now we're on the other side. This the pendulum has swung to the other side. So now we're in this other market phenomenon called the bull market bear and the bull. They're both very masculine like male.

Sara [00:02:03] Yeah. Very manly. Unless we say it's a mama bear. Mama bear and a lady bull.

Caitlin [00:02:13] I think we're taking liberties. Yeah. So I believe the most the, the way that I thought of the bear market was a total shit show. is this the opposite of a shit show. The bull market. Is it just rainbows and unicorns?

Sara [00:02:30] It is kind of rainbows and unicorns out there, which is kind of strange. You know, I was listening back to that episode, Caitlyn and I don't know if you remember, but you were kind of lamenting the fact that we didn't have a champagne party at all time highs, right? That once the market would hit all time highs, that I would probably be like, well, it's just part of the cycle. If the market goes up, the market goes down. But I feel like we should kind of like have whatever the podcast version of the Champagne Party is.

Caitlin [00:03:01] It's just tinkle, tinkle. I was going to ask you this very question is we're not allowed to like, lament our lives and our retirement portfolios and downtimes, but you would also set an up times, we can't like champagne parties. We don't really have, because then you're preparing for the next downturn and you can't take any of it too seriously anyway. Also, I remember saying that every time I turned on the radio, I'm always referring to the radio. I'm like the last person on the radio all the time, but it's like the market hit an all time low, and now every time I turn it on, it's like the Dow hit a never before reached high. So it really is a mirror image of that. And is it just a relief or you're like giddy counting all your money?

Sara [00:03:52] I think that like in the conversations that I'm having with people in the way I personally feel about it at this point, it's more like being really proud of making it through another downturn. Right?

Caitlin [00:04:05] That okay.

Sara [00:04:06] I haven't quite come across people who are super giddy yet because a lot of people are just kind of getting back to where they were.

Caitlin [00:04:15] Oh, so we're at the breaking even point of the market stabilization.

Sara [00:04:19] Yeah. Depending on what part of the market you're looking at, if we're looking at the Nasdaq, which is the tech heavy part of the market, I think we're still at touch below all time highs. If we're talking about the S&P 500, which normally you and I are right. Yes. Then we're above the all time highs. We're at just over 5000 on the S&P 500. in the Dow no one really talks about the Dow. So I don't even know what that's at. But I think that's also at all time highs. So it's more like oh like we made it through and came out the other side. We haven't really hit the like, exuberance phase of a bull market yet. We're mostly at the like, oh that's crazy. That happened. Right. Like, oh man. I mean we made it phase.

Caitlin [00:05:06] Like we're wiping our sweaty brow, but we haven't brought out the cocaine yet.

Sara [00:05:12] Yeah, maybe we're like high fiving. Maybe.

Caitlin [00:05:16] Maybe. Yeah. Survival high fiving. Not like we're gonna be billionaires, right?

Sara [00:05:23] Right. Yeah. The cocaine has not come out yet. We haven't reached that part. But I would say, like, you know, some high fives are. How about this? How about some, like, healthy handshakes?

Caitlin [00:05:31] Oh, Jesus.

Sara [00:05:33] Like, we made it.

Caitlin [00:05:33] Some sleep right now, some backslapping. So we're not supposed to even know about this in our own portfolios, right? Because we're not supposed to be checking every day. We're just supposed to, like, we're in it for the long game. We're just like, maybe things are up, maybe things are down. Is this a time where you're expecting investor behavior to change? And by that I mean my behavior to change?

Sara [00:06:01] No, I think the behavior stays the same. I mean, I think when I think about this and when I listen back to those podcasts that rerecorded, like in real time, right when things were a shit show, I mean, the news was. All bad. And we kind of went through this whole thing where we talked about all the news. We kind of put it into a longer term context. I mean, I listened back to those episodes and I'm really proud of that. Right. But like in real time, we were trying to figure out what to do going forward without like, losing our heads. And so now that things, I mean ended up working out, I mean, there's nothing to say. It had to work out this way. But it did work out. We did. We did get through it. Like, for me, it's like taking that experience in the same way that you take the experience of the bear market. Right. Like I think you said this in one of the episodes, or maybe I said it, someone said it.

Caitlin [00:06:57] Someone smart.

Sara [00:06:58] Yeah, someone very smart and good looking said that. Like when you're in something like a, like a bear market, it feels like the trend is never going to end. Like it's you're just going to keep going. Whatever the trend is, it's going to keep going for all time.

Caitlin [00:07:13] Yeah.

Sara [00:07:13] So I think that being able to experience the down and the up and come out of the other side and look back on it is really powerful for long term investor behavior. Right. Which again it's like what we're all in it for. We can like put the experience like in our pocket and know that we're going to use it again in the future.

Caitlin [00:07:31] So you have more money in your wisdom bank and like seasoned woman of the stock market, like, yep, I've seen it all. I've seen the lows and I've seen the highs.

Sara [00:07:43] There's this economist, Claudia Sam, and she has a rule named after her, the same rule. And she is like the only economist who nailed the no recession call and the economic recovery call. And I am pleased to say that I've been watching her take a victory lap. And I think it's just delightful because usually, like economists and especially like women economists don't go out taking a victory lap on this amazing call they made. But I'm like, really enjoying watching her take a victory lap that she was one of the only semi mainstream economists who was not calling a recession and who did not think it was the end of the world in 2022 and the beginning of 2023. So I feel like we can take a tiny little victory lap to.

Caitlin [00:08:33] Oh yeah, and by we, I, I think everybody understands who that we is. But will you explain to me what an economist a victory lap looks like.

Sara [00:08:44] Like. Oh, because it's so dorky. Like you should definitely follow her on.

Caitlin [00:08:50] Like, but she's like, patting herself on the back. She's like saying like, hey, guys, remember when I predicted this? Yeah. Happened. Yeah.

Sara [00:08:57] It's amazing. Right? Like it's amazing to watch where like, she's just like, that's exactly what she's doing. Because they'll be like a news story that's like.

Caitlin [00:09:06] No.

Sara [00:09:06] Economists predicted this. And then she'll like link to that article and she'll be like, no, I did. And then she'll link back to like her tweet from that month.

Caitlin [00:09:14] And that's delicious.

Sara [00:09:16] It is. It is so awesome. And just like I think that there need to be more women in finance and more women running fraudulent investment schemes and more women running their own parties, I think there need to be more women taking victory laps, because the studies show that women are excellent investors and even more excellent than their male counterparts. And so I'm enjoying Claudia's victory lap, and I think we should all observe it and and give her high fives.

Caitlin [00:09:48] Does she have is she working off different data? I don't want to undermine her success and say like it was a fluke. We can all be right. Like one time. But like, does she have an original or unique way of interpreting market data that led her to have these correct conclusions or predictions?

Sara [00:10:08] I think she has a different framework than a lot of economists. She is a huge proponent of government intervention to prevent recessions. So she was either integrally involved or a consultant on crafting the Inflation Reduction Act, which was that big package that was passed at the beginning of the Biden administration that pumped a bunch of money into the economy. Like, you know, a lot of it was, investing in infrastructure and specifically like clean energy infrastructure. But there were some other parts of that package that basically just put money into the economy in really productive ways. And she was so smart about that because she was, like, intimately involved in it. I mean, she's worked at the Federal Reserve. She has this this it's like a recession sort of recession predictor rule. The Sam rule is a rule that you can use to see if you're in recession in real time. So she has like, a ton of. She has a rule named after her that economists often reference right to tell whether or not we're in recession, and during that time, people would evoke the same rule and she'd be like, Hey, Sam here. We're not in recession. Right. And so, like, watching it in real time, it was incredible because she would get like, people would be like, well, you better check your calculations. She's like, I invented the rule. Like, don't mansplain the rule to me. I invented it and it's named after me. And it's the whole thing is just incredible. So no, it wasn't different data. It was a different way of approaching things. And I think something that maybe is a little bit out of the mainstream of economists and I don't know exactly how, you know, she's bringing that different perspective, but she, more than any other economist, had this respect for the ability for a government to actually put productive money to work in the economy and kind of prevent a recession and.

Caitlin [00:12:16] Prevent a recession. Okay. So and she has the ear of the government, so she can actually actually enact some of the thing or influence that those government programs would be enacted so that her prediction like, it's like an experiment.

Sara [00:12:34] Yeah. I mean, I think she has enough weight behind her that when she gives politicians advice, they listen to it and then sometimes even take it.

Caitlin [00:12:42] Is she on Bloomberg?

Sara [00:12:44] Yes, she is on Bloomberg. Sometimes she's on CNBC. I follow her, she's my favorite follow on Twitter. I mean, she's incredible. I love her so much. I wish I knew her.

Caitlin [00:12:56] Have you ever been at a conference with her?

Sara [00:12:58] No. But, I think maybe I could, she goes to probably, like, hardcore, like, economist conferences. I don't know, I might be able to figure out a way to be at the same conference as her someday.

Caitlin [00:13:10] Fan girl. Your way in there? Yeah.

Sara [00:13:14] I mean, my main point is the victory lap. I feel.

Caitlin [00:13:17] Like. Did we take a tangent? Did, what should Sara do in the middle of the night to gain favor with a famous economist? Anyone you could write Claudia some.

Sara [00:13:29] Please put her in touch with me.

Caitlin [00:13:31] Make it connect.

Sara [00:13:32] Sara at On the Verge.

Caitlin [00:13:36] Okay. Back to this bull market. Here's what I then think. Well, I shouldn't buy anything now because it's too expensive. And now I start really being nostalgic for the low market days when everything was a bargain. And I'm like, can we just go back to a sinking economy so I could get a good deal? Because now it's too expensive. I'm not going to get in there now.

Sara [00:14:05] Yes. I mean, if you look at prices of the stock market over long periods of time, I'm actually going to look this up. There's a really cool. Okay. So this is a chart.

Caitlin [00:14:20] That says 63% of the time the market is within 10% of all time highs. Oh, Jesus. I have to get a PhD to understand that. So yeah, you know, it's like, yeah, that's a good idea. Why don't you explain it?

Sara [00:14:37] So the way that I would explain this, we're looking at this chart and it's color coded. And like Caitlin said, 63% of the time the market is within 10% of all time highs. So if you're looking at this chart, you see that there are long periods of time when the stock market is going up and kind of continuously hitting all time highs, all kind of go up a little bit, come down a little bit, but it's basically just going up. Right. And so if you adopt a strategy of saying, well, I don't invest if the market is at or near all time highs, oh then you're not out. That's right. You're sitting there not you're sitting there with cash or with whatever you're waiting for 63% of the time, which I think when I first saw this chart, I was surprised how often. Yeah. Like the stock market is at new all time highs. Yeah. I mean, it's just kind of strange to think about, like if you, if you kind of take that that perspective of I'm only going to invest when the market is 20% down from all time highs, for example, it says here that that's only 17% of the time.

Caitlin [00:15:47] Oh, man. And the problem is, you know, as with all of it, you they don't ring a bell for you to be like, go buy now. Go buy now. Right. You're waiting for it to go lower because you want the best deal. And then all of a sudden the next day, it goes back up. And so you lost your window.

Sara [00:16:05] Right. So we talked about that in our bear market series too, right. That just because you're buying low doesn't mean the market can't go lower. So if. You're kind of always trying to figure out, am I getting the best deal? You are. It's going to be so difficult for you to be in the market, because you're either in a situation where it seems like the market's going to keep going down, and so you keep waiting and waiting, waiting, or you're going to be in a situation where the market keeps going up, and then it feels like you have regret over not pulling the trigger. You know, 18 months ago, it's so hard. It's why market timing doesn't work for almost anybody.

Caitlin [00:16:41] Well guess what? I saw a comment in one of my Facebook groups for women in finance I can't remember like, and I understood it probably for the first time in my life, and it was something like time in the market beats timing the market every time. Is that a saying?

Sara [00:17:02] Yeah, that's kind of a saying, I like that.

Caitlin [00:17:04] So time, the amount of time you'll be spending wins out every single in every single analysis for a long term investing, then waiting till all time lows to buy or not buying when there's all time highs.

Sara [00:17:20] Like yeah.

Caitlin [00:17:21] That kind of little. Trying to game it in that way will never win. Ultimately against the amount of time that you're in the market.

Sara [00:17:30] Right? So even if the market's at all time highs and we're having a champagne party, we have to keep investing. Right. Because these all time highs will either turn into hopefully and sometime in the future they turn into new all time highs sometime in the future. So we can't stop investing just because the market has recovered and it and prices are higher than they were two years ago.

Caitlin [00:17:56] So is there anything we should adjust us, the normal advanced investors that are just investing for our retirement and for our future life goals. Hashtag Boca. Just kidding. Oh, see, I thought it meant I never even been. But, like, is there anything we should do differently now?

Sara [00:18:20] I mean, I think one of the things that a regular person could look at is their asset allocation. Now that the stocks part of their portfolio has recovered. And by that, I mean, have we talked about asset allocation before?

Caitlin [00:18:36] We have like season one like diversify your little market basket.

Sara [00:18:41] Yeah. Yes. Okay. So we have we have talked about that.

Caitlin [00:18:45] How much interest you should have.

Sara [00:18:47] Right. So asset allocation for most people is the percentage of stocks they want in their portfolio versus the percentage of bonds and cash they want in their portfolio. So risky assets i.e. stocks safer assets i.e. bonds and cash. And so if you think like okay, like my risk tolerance is such that I would like to have 70% of my investment accounts in stocks and 30% in bonds and cash. Now is a good time to go into your accounts and see if that ratio is at 7030, or is it at 7525. Is it at 8020 depending. Because like as the market has changed, your percentage that's allocated to each of those asset classes has likely changed. So you might find yourself after a pretty fast and steep bull market run, you might find yourself with more stocks than you expect. And so when you see that okay, instead of 70% stocks, I have 80% stocks. Your first instinct is very likely going to be but the market's going up. So I should just keep it at 80. Yeah right. But again we get back to that same like decision tree that we talked about during the bear market mini series and that we talk about every time. If you're always adjusting your planner because you're trying to time where the market goes from here. You may as well not even have the plan, right? Okay. Not so if you want some semblance of discipline. You know, if we want to be buying or at least not selling, but ideally buying when prices are lower and selling some off when they're higher, it doesn't mean you're wholesale selling all of your stocks and going to cash. You're just skimming some of your profits off and putting them over in your safe bucket.

Caitlin [00:20:47] I remember looking on the Vanguard website once to see what is my ratio right now of stocks to bonds. Essentially, I don't have cash in my Vanguard, obviously, and looking and there was a pie chart that was very clear that I had 70% stocks and 30% bonds. And then I could make a choice like, actually, I want 80% stocks right now because I feel like I have a long term, I want to do that, be more aggressive. So I do remember that it was easier than I thought it would be to figure that out. Making the point that you don't have to, like, do the math on a napkin yourself. It will be clear where your investment portfolio is. However, it won't show your you your cash in that. So I'm curious how you when you're doing that full ratio picture. If you don't have all of your assets in one place, do you just take like right now my stocks are worth this, my bonds are worth this, and this is what I have total cash in all the accounts and figure out how to do the math from there. Or is there are you indicating some other process?

Sara [00:21:54] Do you mean cash that's held at Vanguard or cash that's held like at UFC? Like if you're at university federal Credit, you could yeah.

Caitlin [00:22:02] Whatever your emergency savings is, whatever. You know, your cash in your savings and checking account and all that. Is that what you're talking about? Looking at that, those three buckets.

Sara [00:22:15] I think for this purpose, it would be just looking at Vanguard if you're investing at Vanguard. So like you said, if you had looked at your pie chart and at some point it was 7030, that was probably a ratio that you came up with. Like, yeah, that sounds like me 7030. Right. So now when you go back and look at Vanguard, if it's 75, 25 or 8020, you need to think about like, well, I'd really. Prefer it to actually be 7030, and that 80% stocks is above what my actual risk tolerance is. Now, that doesn't matter if the market's going up right. It works to your advantage when the market is going up. But what we're trying to get ready for is the next down to.

Caitlin [00:23:07] Go down or at all the champagne parties. There's like but you know, this could all disappear and then, the blink of an eye.

Sara [00:23:17] Let me tell you something.

Caitlin [00:23:19] Okay? So now I'm getting it because, yes, I'll be greedy and be like, ooh, look at all these stocks. Like, it's really puffy right now. It's like, has all this extra money in it. And I feel amazing. But let's say I really in theory, I am not comfortable with 90% of my assets. Being in stock like that is not a place where. And so I'm, I'm kind of distracted from that base value of mine because I feel like, oh, I got rich quick like this. This is I'm a beneficiary of this crazy stock high. But when there's a downturn and I realize like, oh, 90% of my investments are in stocks right now, I need more bonds because I'm going to retire in five years. And like, this is way too scary keeping the target ratio that you have set for very good reasons, keeping that in mind and adjusting and keeping to it no matter what's happening in the market. Is the message here correct?

Sara [00:24:22] Right. Because you're always going to overestimate your risk tolerance when the market is good. Like I'm thinking like I'm looking at a chart now. And if I'm looking at basically the year 2022, which was so horrible, right? In my mind it went straight down. But it didn't go straight down it went. There were pretty big bumps. It went down and then would pop back up, and then it would go down really fast and that would pop back up and it would go down really fast again. Right. So there was a lot of bumpiness, a way down. Right. Because bear markets have higher volatility, like the price movements are wilder. And then if I'm looking at basically like 2023 and into 2024, the path from the lows around October, December 2022 to today, the path is a lot smoother, right? So that smoothness of returns is kind of one of the hallmarks of a bull market when the market is going up. And that's like how a bull market lulls you into the sense of security, right? Like the bull market, it's so easy to make money and invest, right, because the market just kind of goes up. Most of the time when it goes down, it doesn't go down that much. All that volatility is behind us a little bit. I think it's just.

Caitlin [00:25:48] So soothed by you just describing it like, yeah, I'm just a stock girl. I just like I just really like just a personal preference. I just really like stocks. That's like kind of where, you know, everybody has their own thing. I mean it's kind of in the socks. Yeah.

Sara [00:26:05] Just like it's yeah in stocks for the long run. And then you gotta listen back to like the podcast you recorded in 2022. And you're like, I'm sensing some high.

Caitlin [00:26:16] Did you have a mattress.

Sara [00:26:17] To indigestion in 2022. Right. So that I.

Caitlin [00:26:21] Will you repeat that again. Everybody increases their risk tolerance. When the stock market is high.

Sara [00:26:28] Everybody overestimates their risk tolerance when the market is going up.

Caitlin [00:26:34] Jesus. Everybody behind all of this is insane.

Sara [00:26:39] Yeah, I've had to learn this from, like, a career perspective. Right? Because my job is to know what my client's risk tolerance is and then invest accordingly. And when I'm wrong, because I'm taking my clients at face value for what they're telling me. It's very painful for everybody, right, to be like, but you told me, and you fill out all these surveys and you told me that you, like, you're an aggressive investor. And we talked about the downside, and you were like, oh, yeah, I got it. Yeah, totally cool with that. I'm here for the upside. I can tolerate the downside. And then when the downside comes and that that flight response kicks in, it's very painful for all of us. So yeah I know this to be true. And sometimes that's you know, people don't think it's a big deal. And then when the, you know, the bear market happens, sometimes you they can gut through it. It's just very unpleasant. So it's just kind of a way of like knowing yourself. I mean, now luckily we can look back to 2022 and be like, how panicky were we? You know, like, did we tolerate 2022 better than we thought we would? Or worse than we thought we would? Are we do we want to go through it again? Does that not really concern us? You can look back before it gets too far away from you to really think about. What should my exposure to stocks be? Because the only thing that matters is if you're able to stick with it in a downturn.

Caitlin [00:28:03] Well, right. And the amount of time until you need your money.

Sara [00:28:08] Right, right. Well, right. I mean, that's kind of what both of those things are like to you, right? I, you know.

Caitlin [00:28:15] Because I can get all hyped up about all this stuff because I'm forced to talk about it because we have a podcast. But in my normal life, like, just ignore, you know, I just have, like a vague sense of doom when I know it's down and then a vague sense of hopefulness or like I am not profiting as much as I should when there's an up, like there's a lot of, you know, internal shame and all that. But like, if you're not looking at it. These aren't your issues. Right? Right. It's if you have two direct of a connection to the button that says buy or sell is the people that really need to be careful.

Sara [00:28:54] Yeah. Yeah, absolutely. Or I mean, I because I think you bring up a good point that if you've been not looking at it for so long, but you're actually getting very close to a time when you might need the money, like in retirement, then you probably need to check in on it, right, to make sure that the money that you think will be there when it comes time to start making withdrawals is set aside somewhere safe.

Caitlin [00:29:21] Are you willing to say something about if I knew I was going to retire in five years right now, what? I might be adjusting at this when I'm feeling like I'm made of money because the stocks are so high, like, do I? Is there like a real hard and fast rule for like, if you're going to be retiring in the next 5 to 7 years at this current high market, you really need to be doing x, y, z.

Sara [00:29:51] Yeah. And I think it's true, regardless of where we are, like with the market, I think if you're five years out from retirement, you really need to have a plan for setting aside the money that you are going to be withdrawing when you retire. So you should be able to plan that out or going to retire at age 65. I'm going to need to withdraw $10,000 a month to pay the bills. I know this because I know how much money I spend, and I know how much money will be coming in. I'm going to need to take $10,000 out of my investment accounts, and you should start setting that 10,000 a month aside in something almost perfectly safe, in my opinion. And I think you need to start with five years of living expenses set aside and something relatively safe. And then once you go through the retirement transition and actually know what your expenses are and what your life is like, maybe you can take that down to three years of living expenses in something very safe. But the idea is that if the market if the stock market poops out in the middle of this transition, you're not forced to keep working because your whole plan relied on the stock market being at 5000. Right? Like you need to start developing a plan that will be robust enough to survive, even if the stock market is at 4000 for a little bit or 4500 or whatever it is, which means cash. And so I think that people going into retirement need to start building a cash stockpile just to give their plan, like this level of robustness so that their plans aren't derailed by the stock market. Like we don't want like our short term plans to be hinging on whether or not the stock market is good or not.

Caitlin [00:31:41] No, but it's like leaving the party when it's still good. You know, it's millennial that way. Yeah. To be like, oh God. I mean, it's great because you're getting more money when you cash it out than you would if the. But it also must feel like really like, can I, I could get more money though. Like I'll put it off for a year. I could get even more only to have something like 2020 hit and you're like, oh.

Sara [00:32:09] Yeah, it is. It's like going to a really fun party, but skipping the after party.

Caitlin [00:32:15] Right.

Sara [00:32:16] Where you're just like, I'm going to go out on my own terms. Yeah, I am leaving on my own terms.

Caitlin [00:32:22] I didn't I'm not going to do the shots. I'm going to just like, take this buzz, buzz on home, okay?

Sara [00:32:30] I'm going to make some good choices.

Caitlin [00:32:32] And.

Sara [00:32:33] Feel good about myself tomorrow.

Caitlin [00:32:34] The other thing I like thinking about is for young investors, people just starting their career. This is really good experience on like yearly investing habits that do not, like alter just because of what the stock market is doing and that they'll, they'll have experience depending on where they are really big downs and then really big ups. And if they just keep plodding away by setting goals of what they can put aside from their salary to put in their retirement account, that that is the muscle that they're they're building, not the gaming, the stock market or trying to make some like genius moves based on where the stock market is. They have enough time, enough decades that they'll be in the market, that you can kind of learn how to not be reactive.

Sara [00:33:26] Exactly, I love that, yeah.

Caitlin [00:33:30] How about people like me work? Feel like you keep my regrets going for all those lost decades, and just keep plodding along and putting it in? You've made it.

Sara [00:33:45] You made it through.

Caitlin [00:33:46] The other side.

Sara [00:33:47] You've made it through so many bear markets at this point. When did you first meet the investor class?

Caitlin [00:33:51] No, them. I didn't know that they were happening. I didn't have a name for them. Yeah. No, I have the same. All have the same. Sort of like, you know, jaded view of it all. Yes. These are the up.so. Yes. And those were the downs. And they'll come again. I mean, I feel like a grandmother, you know, just like explaining to my great a great grandmother, explaining things on a rocking chair. So I can live with that. I can live with that. I do, you know, as usual, I just think that our podcast could be two sentences like, invest for the long run, leave it there, go buy.

Sara [00:34:30] That. That is just what it boils down to.

Caitlin [00:34:33] Is there anything else you feel like we need to know about the bull market?

Sara [00:34:38] Maybe just something kind of fun, which is bull markets tend to be longer than bear markets. So if you're, you know, it's just opening the bottle of champagne. You know, you might have time for another couple of rounds, but don't go to the after party.

Caitlin [00:34:52] What you just said is the cocaine is coming.

Sara [00:34:56] I'll leave before the cocaine comes. You can drink champagne. That's it. And then take an Uber home.

Caitlin [00:35:04] Okay. How long are we in the bear market? Because I remember in one of the episodes you said, like, there are typically nine months or something like that, and we're at month five or something, and it was sort of a relief like, oh, okay, we can survive this. Oh yeah.

Sara [00:35:21] Let's see. So we did that podcast in July of 2022, the market finally hit its most recent lows in October. In mid-October, it got down below 3600 on the S&P. When we recorded that podcast, I think I saw that we were at like 4100 on the S&P. So we fell another 600 points before the end of the year and before it came back. So we'd probably say that bear market lasted. I mean, really it probably lasted about 12 months and then started that the next leg up of the the bull market.

Caitlin [00:36:02] So a little bit longer than like the average.

Sara [00:36:07] But not that much longer.

Caitlin [00:36:09] Okay.

Sara [00:36:10] Which is kind of interesting.

Caitlin [00:36:13] And bull markets typically last longer. Well, so listeners, what I think is interesting about this is when Sara said she wanted to record an episode about the bull market, I was like, okay, well, we have to do it. Like on a day that it's the bull market and we'll have to like, record it and then put it out the next day. So it's like relevant information. And she's like, no, it doesn't really matter. And that was so surprising to me that like, you were so confident to say, like whatever information we discussed based on the current market will still be true whenever we publish this episode, which isn't going to be it years from now. But for me, I think of the market as like day to day. I have no idea what it will be like. And you were like, no, we're in a bull market. So like, even if it takes a month or whatever for it to come out like that, information will still be solid. Are you going to still stand by that?

Sara [00:37:06] Yeah, I'm going to stand by that. I mean, I think this I think we're solidly in a bull market and maybe it lasts a couple of years, or maybe it lasts a few years. But bull markets tend to have longer duration than bear markets. So I kind of think we're at the beginning of that, not at the end. So I'm going to stand by that.

Caitlin [00:37:29] Stand by it. I mean, we'll give you your victory lap. If we remember two years or whatever, we actually drop this. Just kidding. Okay. Is there anything I remember? The upside of the bear market was that you can get all these bargains. Yeah. Are there any downsides of the bull market other than, like, you don't get as much for your money when you're investing?

Sara [00:37:55] I mean, I think that at this point, if there are no signs or there aren't that many signs of I don't know what Alan Greenspan coined irrational exuberance. You've heard the term irrational exuberance, right?

Caitlin [00:38:09] I love irrational exuberance.

Sara [00:38:11] Yeah. I don't know, like I don't see like, any anecdotal evidence of irrational exuberance. I still think people are not really quite sure that this is a bull market, you know, and that I don't think people are that confident it, which is actually a pretty good thing. I think the downside is maybe falling into that, being afraid to invest at all time highs fallacy, right. And underestimating how long bull markets can last. I mean, because think about like how painful it is to try to outweigh. Wait a bull market.

Caitlin [00:38:46] Okay.

Sara [00:38:47] You're sitting there in cash, and it just keeps going higher. And you're just sitting there and it keeps going higher. Like, that's a very painful for the people who are waiting to jump in. And so time it. Right. So the assumption is eventually they give up. Right. Just like you know sellers give up in a bear market. You know, buyers will give up in a bull market and they'll eventually just get in at whatever the price is. And that continues to drive it higher. So I guess it's it does it just comes back to timing. You know, time in the market not timing in the market.

Caitlin [00:39:23] And why has Yahoo Finance endured when all of the other Yahoo products have not?

Sara [00:39:30] I don't know, I think it might be personal to me that it's just endured for me. It's like the only like it's easy to pull up a chart and to it's easy to use, but I just can't quit it.

Caitlin [00:39:44] Do you recommend it?

Sara [00:39:46] I do, I do recommend it. Like I think it's relatively easy to use. You can get some like not like the most sophisticated charts, but I.

Caitlin [00:39:53] Mean, we don't need.

Sara [00:39:54] Them. We don't need them. We just are looking like, looks like it's up ish. Looks like it's down ish. So I really like it. Still, after all these years?

Caitlin [00:40:04] Still after all these years, who knew that? I mean, there's still have the lights on.

Sara [00:40:08] I know for now, I think they just kind of upgraded their charts to. I think Yahoo Finance is the only. It's like the only piece of the company that they put money into, as far as I can tell like that.

Caitlin [00:40:21] Okay. Well, women on the verge, that's the bull market. We had three episodes on the bear market because I guess the idea is that you're so much more worried about it when things are down and when things are good, it's like, yeah, everything's fine. So that's it. The end. Yeah. But if nothing else, you'll maybe understand that the bull one means a good market and the bear one meets a bad market. That's what I'm going to try to take away from these episodes. Let's get this straight.

Music transition by Bad Bad Hats

Sara [00:41:01] Did you have a question about finance or investing? Send it to us in an email or voice memo on our website. Womenontheverge.com.

Caitlin [00:41:10] Hey, we want our listeners to know that economic abuse can be subtle, but it's a serious form of control. Watch out for partners who limit your access to money. Sabotage your job or rack up debt in your name. If this sounds familiar, know you're not alone and there's help available. Please learn more at the hotline.org or call 800 799 safe.

Sara [00:41:36] This episode was edited by our co-producer Kelly West, with music by Bad Bad Hats and Devmo.

 Music outro by Devmo

Devmo I know the first thing you notice is that I'm covered in gold, the flick of the wrist it could turn a hot bitch cold, to get what you want in life girl you gotta be bold. Now Imma die rich, and I know...

Sara This podcast contains general information that is not suitable for everyone. The information contained herein should not be construed as personalized investment advice. Past performance is no guarantee of future results. There is no guarantee that the views and opinions expressed in this podcast will come to pass. Investing in the stock market involves gains and losses and may not be suitable for all investors. Information presented herein is subject to change without notice and should not be considered as a solicitation to buy or sell any security.