Bull Markets, Bear Markets, and Why Both End
Markets breathe. Long expansions where everything works, sharp contractions where nothing does — the cycle is as old as markets themselves, and it has never once been repealed. You can't schedule it. You can absolutely be someone it doesn't wreck.
A bull market is a sustained rise; a bear market is a fall of roughly 20% or more from the peak; a correction is a shallower 10%-ish dip. The labels get stamped in hindsight — nobody rings a bell at the top or the bottom, ever. The names describe weather that already happened.
Here's the base rate that calms people down: meaningful dips arrive routinely — most years see one — and deeper bears show up every market generation. Each one feels like a unique emergency. Statistically, it's the tide going out on schedule. An investor who expects declines is startled by nothing; one who doesn't is startled by everything.
Euphoria at tops — 'it's different this time' — and despair at bottoms — 'it's over forever' — aren't reactions to the cycle. They're the fuel that drives it: crowds overpay in comfort and oversell in fear, stretching each phase past reason. The strongest feelings, in either direction, appear precisely at the moments they're least trustworthy.
Markets turn on expectations — you learned this — so bottoms form when things merely stop getting worse, long before they look good. Waiting for the all-clear headline means missing the recoveries' violent early leg, where a shocking share of the gains happen. This is why exit-and-return timing fails so reliably, even for professionals.
The whole game is arranging your life so a bear market can't force your hand: no invested money you'll need this year, positions sized so you sleep, a plan written before the storm. Our own system runs automatic exposure cuts on deep drawdowns for exactly this reason — the survival rules get decided in the calm. Yours should be too.
The market breathes in and out, feelings peak at the wrong moments, and the recovery never sends an invitation. Plan for the whole cycle and both halves of it become survivable — even useful.
Not financial advice · Educational only