Bull vs. Bear Markets for Global Stocks from 1980 to 2024: Chart

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Markets go thru many phases of bull and bear markets over decades. Though bear markets are difficult to handle, bull markets tend to be longer. For example, from 1980 to 2024 global stocks as represented by the MSCI World Index had bull markets whose duration were four times that of bear markets. In addition, the average total return was much higher during bull markets than the losses during bear markets.

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Source: When markets are volatile, it pays to stay invested, Vanguard Australia

Mining is Essential: Infographic

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The province of Ontario in Canada is rich in many natural resources. Mining companies there extract a variety of minerals such as Silver, gold, Nickel, Copper, etc. I recently came across an infographic that shows how mining helps us in our everyday lives. For example, copper is used in hospital equipment and devices to reduce the risks of infection.

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Source: Ontario Mining Association

The Trading Power of China: Chart

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China is the second largest economy in the world with a nominal GDP of about $18.5 Trillion in 2024. The Chinese economy has had tremendous growth every year until a few years ago. One of the industries that contributed to the growth is the manufacturing sector. Products made in China are found in most of the markets in the world. Chinese companies have not conquered the markets in the developed world but also in most emerging and frontier markets. I recently came across an interesting article at Der Speigel that I had bookmarked last October. The article discussed if the German economic model is in trouble and if this is the end of Globalization. Two charts from the piece caught my eye.

The following chart titled “The Trading Power of China” shows that most countries depend on China for their imports in 2022. Though the US was the largest importer with good worth over $575 billion, most countries in Africa, Latin America and Asia also had huge imports from China. For instance, Brazil imported about $68 billion worth of goods from China.

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Source: The End of Globalization? Germany’s Successful Economic Model Could Be Finished, Der Spiegel

One factor that is helping China with becoming a major trade partner for many countries in the world is its “Belt and Road Initiative” thorough which China is investing heavily in infrastructure projects around the world. The following chart shows the member countries of this initiative in 2023:

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Source: The End of Globalization? Germany’s Successful Economic Model Could Be Finished, Der Spiegel

There are many other fascinating details in the above linked article.

Asset Class Returns From 2010 To 2024: Chart

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In earlier posts we looked at the return charts for emerging markets, developed markets and the S&P 500 for 2024. In this post, let’s review the annual returns chart for asset classes from 2010 to 2024. Last year, large caps were the top performers while the worst performer was high yield bonds with a return of just 1.3%.

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Source: Novel Investor

Developed stocks outside of the US also had poor returns with a return of 4.4%. For many years in a row foreign developed markets have under-performed the S&P 500. However so far this year they are ahead of the US markets. It remains to be seen if they indeed beat the S&P 500 this year.

Related ETFs:

  • SPDR S&P 500 ETF (SPY)
  • iShares Core S&P 500 ETF (IVV)
  • Vanguard S&P 500 ETF (VOO)
  • SPDR Portfolio S&P 500 ETF (SPLG)
  • Vanguard Developed Markets Index Fund ETF (VEA)

Disclosure: No positions

The German Economy Has Been Flat in the Past 5 Years

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Germany used to be called the Powerhouse of Europe until a few years ago. That is no longer the case. The country’s economy is in doldrums and no government seems to know how to fix it. In fact, Germany may be on the way to becoming the sick man of Europe like it used to many decades ago. The automotive sector used to one of Germany’s flagship industries. However Germany auto firms failed to adopt to recent changes in the industry including the move towards EVs and are unable to compete with China’s auto firms. Instead of focusing on the economy the country is bogged down in dealing with issues such as illegal immigration on a daily basis.

Last last month I came across an article in The Guardian and Reuters on how the Spanish economy soared in 2024 with a GDP growth of 3.2%. The German economy on the other hand contracted in 2024 by 0.2% last year and this contraction was the second time in a row. A recent article at Syz Private Banking by Adrien Pichoud discussed the outcome of the elections in Germany last week and the difficulties facing the economy. One of the charts that stood out was how the GDP level has stood basically flat in the past 5 years:

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Source: Germany: Friedrich Merz faces a difficult but essential challenge, Syz Private Banking

Below is a brief excerpt from the piece:

After a decade as Europe’s powerhouse, Germany has revived the spectrum of “the sick man of Europe” that it was a quarter of a century ago. Its economy has been contracting for two consecutive years in 2023 and 2024 and its GDP level stands at the same level as five years ago, while all other European economies have enjoyed positive growth since the end of the COVID era. A combination of external shocks, like lower Chinese demand, end of cheap Russian gas supply, plus rising interest rates and the lack of fiscal policy support, have all led to the dismal economic performance of the largest economy of the continent. In this context, the need for economic reforms designed to improve short and medium-term growth prospects is enormous and the new government will have to take swift action to revive a positive dynamic in the economy.

It remains to be if the new government by Friedrich Merz of the conservatives can set the course straight for the economy.

Related articles:

Investors are betting on a revival of economic growth. The DAX index has performed well so far this year with a return of over 13% outperforming the S&P 500.

For a list of German stocks trading as ADRs on the US markets click here.