History of US Bear & Bull Markets Since 1926

I saw a really cool post on twitter that charted all the bear and bull markets in the US since 1926. Here is a link to the chart.

Keep in mind that only the S&P 500 is charted here. The S&P 500 is an American stock market index based on the market capitalizations of 500 large companies having common stock listed on the NYSE or NASDAQ

bull-beear

The most interesting thing I found through this chart is this –

  • the average Bull Market period lasted 8.9 years with an average cumulative return of 490% (or an average annual return of 55%)
  • the average Bear Market period lasted 1.3 years with an average cumulative loss of -41% (or an average annual loss of 31.5%)

This simply means that you are almost always guaranteed to make money investing in the stock market. Think of it this way – if you began investing in the stock market with $1 at the start of a bull market, you are likely to generate a cumulative return of 490% or have roughly $4.90 at the end of the bull run, after 8.9 years. Then comes a bear market and wipes out about 41% of your portfolio in 1.3 years. So you’re left with about $2.90 after a bull and bear market (or about 10.2 years).

Essentially, you have tripled your investment in about 10 years, after all the ups and downs – a much higher return than if it sat in a regular savings account or under your mattress. If the money sat in a savings account earning on average 2% per year, you would have about $1.22 after about 10 years.

* none of these figures were adjusted for inflation

 

If you don’t have a robust economy, forget about sustenance or revival

I read a very interesting piece on Cleveland’s potential “comeback”, which should not come as a surprise to anyone as there has been a lot of talk of a comeback for a number of major rust belt cities like Detroit, Buffalo, Pittsburgh, etc. What I was not aware of about Cleveland was that there was a brief “comeback” period during the 1990s. The city lured the Cleveland Cavs, built new stadiums, added nightlife options, shops, etc., in the downtown, in an attempt to reinvigorate it. The end goal was to have residents who lived in the suburbs come to the City to spend money. However, this initiative did not pan out as expected because Cleveland was lacking one major ingredient – a robust regional economy. Without that, the money to spend at all these new and exciting venues was limited.

Interestingly, a localized/internal economy will often not be enough to drive a comeback or sustain a (medium or large sized) city. What is required is a “tradable economy”, as the author states, which allows goods or services to be sold outside a region. The “tradable economy” is important because it brings outside money in – something which can rarely be created through a localized/internal economy.

But there is also another crucial element to consider regarding a robust and “tradable economy” – accessibility.

A former Masters professor of mine, Steven Farber produced a fascinating study and several maps that detail the level of opportunity in terms of how easily people can access jobs in the city by different modes of transportation  in the Toronto region. Farber determined that residents with access to a car unsurprisingly have access to the greatest number of jobs. However, he also determined that residents without cars who live along subway lines can access about 30% of the jobs that those with cars can (within 45 minutes). And for residents without a car that live away from subway lines, they can only access 5-10% of the jobs that people with cars can access.

Figure 1 – The ratio of jobs reachable by transit compared to cartransit-axccess-jobs-cars

An important point emerges through Farber’s work – the robust and “tradable economy” can be quite limited if those without a car are able to access only a portion of those jobs.

Number of Units per Acre in Toronto and the GTA in 2016

Census 2016 is out. Data nerds rejoice!

Below are two quick maps I made using 2016 population and dwelling count dissemination area data from Statistics Canada. All the data, shapefiles and various other information (including the data and shapefiles I used to make the maps below) can be found here.

If you want to check out an awesome interactive map of Census 2016 data (population density) made by my friend Tom Weatherburn, check this out – https://tdubolyou.github.io/PopDens2016/.

Figure 1 – Number of Units per Acre in the Greater Toronto Area, 2016density-gta-units-per-acre

Figure 2 – Number of Units per Acre in Toronto, 2016density-toronto-units-per-acre

A book called, Visualizing Density published by Julie Campoli in 2007 explains what different densities across the US look like. Below are some examples that can be cross-referenced with the maps above (images can be found here):

This is what 5 units per acre looks like:

5unitsacre

This is what about 50 units per acre looks like:

50unitsacre

This is what approximately 100 units per acre looks like:

100unitsacre