What History Says About Market Comebacks

Added: 2026-05-05

[00:00:00]Years that you have corrections or you have down years, what happens the following year? What do you see going forward? Is it going to come down farther? And once it does, what happens next, historically speaking?

[00:00:09]>> It certainly could come down farther.

[00:00:11]The average of all of those corrections that we were looking at was minus 14%.

[00:00:15]We'd still have another 4% go just to be average. But also remember that all of those averages include recessions and bear markets. Our base case is that this will not be a recession, it will not be a bear market, more like an ordinary correction. I suspect when the US involvement in Iraq dies down, the market will focus on traditional fundamentals with earnings and PE ratios. That's what we're looking forward to. But if you are a buyer when the market is down double digits, you're almost always rewarded with a double digit return 12 months out.