Disagreeing With a Flat Decade: A Bullish Long-Term View on the S&P 500

24 days ago

Speaker

"I disagree that the S&P will be flat over the next 10 years. But I'm also not seeing a 15% 20% annual return as a new normal for the next 10 years. I think some of that was a little bit too extended and some of it was due to the stimulus checks and COVID and all of those money that was pumped in the system that's unlikely to repeat itself over the next I would say 5 to 10 years. So if we're using all those estimates which I believe they're fair I see about a 7 8% annual return which is the long-term average of the S&P 500."

The speaker challenges the notion of a flat decade for the S&P 500, arguing instead for a modestly bullish long-term outlook. By comparing historical performance and valuation metrics such as earnings growth and forward multiples, the speaker outlines that an average annual return of approximately 7-8% over the next 10 years is more realistic. They highlight the role of the Magnificent 7 and correlations with monetary factors like the M2 money supply and the Fed balance sheet, suggesting that ongoing monetary easing will support a gradual recovery in performance.

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