Why You Should Avoid The Stock Market

Many people who invest in the stock market today were involved during the great bull markets of the 80s and 90s. Their very DNA is impressed with the fact that markets always go up.

This is even considering the performance we have had over the past few years when the stock market was more roller coaster ride than escalator. Dips and dives that would make even the most serious investor's head swim.

So why do so many people still look at the stock market as being the only place to invest? It comes down to the lack of financial education that most people get in school and life. All they know they gained by experience. Their early experiences count the heaviest towards the patterns that they develop.

Since they started investing in the market during a great bull run, that is all they consider to be fact. Markets always move up. I think we heard this in real estate too though we are currently finding out differently.

The economy and the stock market work in cycles. If you do a long enough historical analysis you will find these patterns repeat themselves on a fairly regular basis. It has a lot to do with generational cycles as the stock market is a combination of both fundamental issues and psychological ones.

The following graphs show different time frames over the last few years.  You can see the dramatic differences in performance during those times.  The stock market was going through business cycles during this time.

 We are currently in a Winter Cycle.  It is a time of retracement and very limited growth.  You can learn a lot more about it listening to Tony Robbins stock market prediction here.

If you invest in the market it is in your best interest to study and learn about economic cycles and stock cycles.