First, not predicting a lost decade. If anyone knows how to see one coming, let us all know please. But there are enough signs–still problems with valuations, life after QE, inflation, potential recession and other situations that make the possibility real of a lost decade.
BofA issued guidance to expect very low returns for the next ten years…”Price to normalized earnings has a very strong relationship to subsequent S&P 500 returns over the long haul, and the S&P 500's current trailing normalized PE ratio of 29x suggests 10-year annual 12-month price return of -0.8%, representing the first negative returns since the Tech Bubble,” Munger has echoed similar concerns.
If we hypothetically say there is an upcoming lost decade in stocks, how would you invest? Which asset classes? During 2000-2009, I had no plan other than the try and pick undervalued quality stocks. It was a rough, frustrating time. Any investors that can share their experience/knowledge on the last lost decade and how they navigated it and what they learned?
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