Q: Van talks a lot about being in a secular bear market, but what evidence do we have that this is the case or what is this belief based on?
Kind regards, Paul

A: Secular bear means that PE ratios go down over a long period of time. What evidence is there? Look at the PE ratios on the S&P 500 since 2000.

Ed Easterling’s research on the markets is probably the best evidence for it. His book is called Unexpected Returns. Also Michael Alexander’s book, Stock Market Cycles is excellent.

Now the unusual thing about secular bear markets is that often the fundamental conditions are not that bad. However, the fundamental conditions of the US economy (and Europe too) is the worst I’ve seen in my 63 years. It was much better at the end of WWII when I was born. — Van