Confusing Brains with a Bull Market

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Confusing Brains with a Bull Market
PeteLinforth / Pixabay

Dear fellow investors,

It is hard to think about 1981, my first full year in the investment business. Three-month Treasury bills were paying 18%, longer-term Treasury bonds yielded 15% to maturity and cheap stocks got 20% cheaper. In the summer of 1981, we saw a stock market decline from an already depressed market trading at eight-times after-tax profits down closer to six times. Participation in the stock market was down to 13.2% of U.S. household financial assets at the market bottom in 1982.

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Inflation was high, gold was po