Subject: Re: Reversion to .....mean? S&P?
"I wonder how many were advocating buying the dip in the Japanese market in early 1990. It took about 35 years for the Nikkei 225 to exceed the record it set in Dec. 1989. As long as 23 years after that 1989 high, it was still down 78%. And all that happened without an autocratic coup in Japan.

Elan"

I just got back from a week in Japan yesterday. Here's my take...... We were in Yokohama and Tokyo. All I could think about was the quote above because Japan has basically gone nowhere since 1989. And yet here's the thing- I don't think I have seen a more modern and organised society than Japan. So while economically speaking the country may have gone "nowhere" there has undoubtedly been massive progress which means someone (or perhaps everyone?) had to be gaining. I think of Warren discussing the British Empire and stating that even though the empire collapsed the average British citizen is undoubtedly better off than they were before WWI.

What I fear in the US right now is the unquestionable darkness of this self induced delcine. The US is in a bad place! The bond market is revolting not because of a factual decline but out of fear that this decline is inevitable and the old adage about "not being able to fool the bond market" is further freaking everyone out. Why? Because every fear of electing an unhinged dictator has so far proven to be true. Without evidence of a viable check and balance being put back in place I don't see the market in general improving.

Japan's decline has had as much to do with demographics as it did with reckoning the man made bubble it created. They have had a declining population which is the ultimate market killer and do not have any form of immigration to offset that decline. So while there has been no "growth" there has been progress because the country has been trying to move forward despite the headwinds. Contrast that with the US- we are taking a hammer to the federal government, tossing people out of the country and sending them to gulags in Central America and unquestionably damaging our brand with absurd rhetoric on a daily basis. And some are wondering why the bond market is revolting??

I have no idea what will happen. Nor does anyone else. I sold out of all US equities in my wife's account which is tax free because she is not a US citizen. I have sold nothing in my US Schwab account which is 85% Berkshire and Philip Morris International so thankfully that has held up for the time being.

Until the fevered pitch of Trumpism is broken I just don't see the country going anywhere but down. Call that statement "political", shout it down if you must but I grew up in NY and I know a con man when I see one. Actually, I've this since the early eighties which has made the last ten years even more bizare but that's a different story! Let's hope for signs of a viable check and balance!! We can survive the next four years if we have that. If we don't? Just look to the bond market........