I’ve seen the claim in the title in my Twitter feed and there’s also a Business Insider article about it. Not only that, but when we supposedly last had six consecutive positive years (1898-1903) what followed was an 18% correction in 1904.
This would be a strong point in a bear-case scenario. If it was true. But what amazes me is that no one seems to question the accuracy of those statistics. It just gets shared and re-tweeted as if it was gospel truth.
After looking at the actual data though, we get a different picture. The S&P500 was first up six consecutive years between 1947-1952 and then 1953 came with a -1.21% correction. Then we had the ‘greed is good’ eighties when the S&P500 managed eight consecutive positive years (1982-1989) followed by a -3.06% correction in 1990. In the nineties S&P500 made a record with its longest winning streak, nine years (1991-1999) followed by a -9.03% fall in 2000.
I’m not making a case for the S&P500 bulls here. I just think that before we get excited and spread the word about some ‘first time in history’ event, we’d better make sure that it really hasn’t occurred before. Otherwise we’re just like the characters in the drawing above.