We met the prior high for US stocks this week.
Posted on June 7, 2024

On Wednesday, the real, inflation-adjusted value of US stocks met its prior highwater mark in November 2021.In less than a year later, we reached the trough of 30% decline. It’s a battle to recover from that steep of a decline over a year. I reported we were within 3% of that mark in early March, and we finally got there three months later.

We got back to the prior peak in 2 years, 7 months. But we aren’t out of the woods yet: we really have to put the mark in November 2021 permanently behind us, and we have to wait to see if we’ve really done that. The average time to put that steep of annual decline behind us has been seven years.

Here are the details:

I use S&P Global’s index for Total US Stocks. I use the index for Total Return. I use the peak on November 8, 2021. The index, without adjusting for inflation is now 13% above that. But we’ve had ~13% inflation. That means we have ~matched the prior peak of November 2021.

Conclusion: We have essentially recovered from a 30% one-year decline in US stocks from November 2021. This has been a relatively fast recovery. We are not out of the woods yet, because we really need to put it behind us.