Now feels like a good time to remind investors about the nature of dips, pullbacks, and corrections. Even in bull markets, it’s fairly routine to have shakeouts along the way. So far, this is pretty orderly.
The $SPX500 averages about three 5% corrections a year. We had a gnarly pullback in April, with the $SPY (State Street SPDR S&P 500 ETF) falling about 20% from peak to trough. While a record rally ensued, the lack of volatility we saw in Q3 was simply unsustainable.
While earnings have been strong, uncertainties — like those surrounding the government shutdown, legal ruling on tariffs, the labor market, the Fed’s interest-rate path, and an AI bubble — have emerged.
You can argue about whether these factors will even matter in a few months. But the fact is, the overall level of uncertainty has increased over the last 4-6 weeks -- and as we know, markets do not like uncertainty.
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IMO, the longer term trends remain pretty solid. That doesn’t mean we can’t go lower from here, but it does shed some perspective on why we’re seeing what we're seeing right now. So far, this is a routine — and tbh, overdue — dip.... Show More
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Tue Mar 10 2026 15:22:25 GMT+0000 (Coordinated Universal Time)
