The Little Book of Stock Market Cycles

143 Pages·2012·2.98 MB·English

by  Douglas A. Kass

Contents
Foreword
Introduction
Chapter One: Cutting through the Bull
Describing the Markets
Talking in Seculars
Let’s Shoot Some Bull
Seeing What Tomorrow Brings
Chapter Two: War and Peace
Creatures of Habit
War: What Is It Good For?
To Boldly Go Where the Dow Has Never Gone
Chapter Three: A Century of Booms and Busts
As the Century Turns
World War I
The Roaring Twenties
And Then Depression Set In
World War II
The Consumer Boom
The Vietnam War Heats Up Inflation
That 1970s Stagflation
The Information Revolution
The Greatest Boom
Lather, Rinse, Repeat
Chapter Four: The Coming Boom
Dot-com Bust versus 1929 Crash
The Global War on Terror
Bubblicious Housing
Four Horsemen of the Economy
The Colt of the Economy
We’re Not There Yet
Five Years to Go
Chapter Five: Your Portfolio Gets Political
How the Government Manipulates the Economy to Stay in Power
Post-Election-Year Syndrome: Paying the Piper
Midterm Election Years: Where Bottom Pickers Find Paradise
Preelection Years: No Dow Losers Since 1939
Election Year Perspectives and Observations
Chapter Six: Open Season for Stocks
The “Best Six Months” Trading Strategy
Times They Are a Changing
Fourth-Quarter Market Magic
Two Market Phenomena in Perfect Harmony
Seasonally Well Adjusted
Chapter Seven: Aura of the Witch
Financial Incantations
Seasons of the Witch
Manic Monday and Freaky Friday
Witches’ Brew
Chapter Eight: Autumn Planting
August Annals
September Scenarios
October Occasions
Sowing the Seeds of Gains
Chapter Nine: Winter of Content
Navigating November
December Delivers
Wall Street’s Only Free Lunch
When Santa Fails to Call
January Jubilee
Best Three Months
Chapter Ten: Spring Harvest
February Findings
March Madness
April Action
Chapter Eleven: Summer Doldrums
May Matters
June Juju
July Jolt
Chapter Twelve: Celebrate Good Times
Santa Claus Comes to Town
Martin Luther King Jr. Day
Negative Presidents’ Day
The Luck of the Irish
A “Better” Good Friday
Memorial Day and the Stock Market
Few Fireworks on Independence Day
Trading the Labor Day Markets
Sell Rosh Hashanah, Buy Yom Kippur, Sell Passover
Trading the Thanksgiving Market
Chapter Thirteen: Don’t Sell on Friday
Most Gains Occur on Monday and Tuesday
Monday, Most Favored S&P 500 Day
Bear Hurts Monday and Friday
NASDAQ Strong Like Bull
Traders Take Lunch, Too
Chapter Fourteen: Picking the Ripe Trade
A Chance for the Individual Trader
For Everything There Is a Season
It’s All about the Timing
Taking a Good, Hard Look at the Indicators
Have Sound Trading Discipline
Acknowledgments
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Books in the Little Book Big Profits series include:
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Investing by John Mauldin The Little Book of Stock Market Cycles by Jeffrey
Hirsch
Copyright © 2012 by Jeffrey Hirsch. All rights reserved.
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Published simultaneously in Canada.
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For Jennifer and our two boys, Samson and Nathaniel
Foreword
It might seem odd that a fundamentally oriented investor would write the
Foreword for a book devoted to technical analysis. After all, many fundamental
investors view technical analysis as nothing more than fortune-telling, and
technical analysts as wizards who should be locked up and kept away from the
children (and investors/traders who behave like children). But here I am, a
fundamental investor, doing just that.
The fact is that the business of investing is complicated. Think of it as a
pyramid with each angle of the pyramid representing a different approach—
you’ve got the fundamentals, valuation, and the technicals.
It is the influence on equities called the “technicals” that Jeff Hirsch captures
so eloquently and succinctly in The Little Book of Stock Market Cycles.
Jeff’s thoughtful book takes a cue from Winston Churchill, who once wrote
that “the farther back you can look, the farther forward you are likely to see.”
As Jeff writes, the lessons of stock market history are invaluable. The study of
patterns from the past makes future trends clearer, just as the avoidance of
history makes them potentially lethal to your investments’ well-being.
Mr. Market is not an easy guy to get to know. Analysis of market history and
the rhythm of financial cycles isn’t a simple task, and especially not the way Jeff
does it. Determining the roles that human behavior, holidays, elections, seasons,
and the calendar play in influencing the stock market’s direction requires careful
observation and critical thinking. Even the role of peace and war is fair game in
Jeff’s analysis.
And then there is Jeff’s outlandish May 2010 prophesy of a super boom in
stocks—in which he feels the Dow Jones Industrial Average may rise to 38,820
by 2025!
Learn why Jeff is ringing in a new bull market beginning in the 2017−2018
period. His conviction is high and his reasoning appears sound.
In The Little Book of Stock Market Cycles, Jeff presents a commonsense
message and invaluable lessons for how to take advantage of time-proven
market patterns. Both individual and institutional investors should take notice.
After all, those who cannot remember the past are condemned to repeat it!