Since the bear market bottom in March 2009, there have been seven "crises" by our count:
There may have been others, but those seem like the biggest—garnering the most media and investor attention.
But were any of these actually a crisis? To be completely nitpicky, Dictionary.com defines crisis as "a stage in a sequence of events at which the trend of all future events, for better or worse, is determined; a turning point." Sure, pockets of the world are troubled—but each "crisis" has thus far failed to deliver the massive, dire consequences feared. The PIIGS fallout (or lack thereof, since they continue to have successful debt auctions and now have a massive bailout backstopping them) is still uncertain, but our guess is it has the same market implications as last summer's dollar fears (i.e., fleeting, then stocks march higher.)
Over the past few weeks, we've highlighted strong fundamentals underpinning this market recovery. Here are more. In our view, together, they simply outweigh the Gulf spill and Greece—just like they did with Dubai's "crisis.
More events will likely be labeled "crises" moving forward, and they'll cause some market volatility. But sometimes, crises aren't so critical longer term. They are frequently misunderstood or greatly overestimated. Plus, by the time they hit "crisis-gate" status, they are usually widely known. Large, underappreciated, fundamental issues going unnoticed generally drive true turning points—like the still unlabeled FAS 157 "crisis" two years ago, which greatly exacerbated liquidity issues and the bear market. So, following the real unlabeled crisis, we've had about seven labeled crises that weren't so critical—making such frequent use of the word reminiscent of the boy crying "wolf."
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*The content contained in this article represents only the opinions and viewpoints of the Fisher Investments editorial staff.