The headlines can be jarring. Each day brings news of the market up one minute and down the next; record losses one day and record gains the next. Will the Fed’s actions help? Will Washington’s efforts aid the economy, both individually and nationally?
We’re obviously referring to the headlines of today surrounding the coronavirus (COVID-19), right?
Or maybe the headlines of 2008–2009, when the market dropped by almost half?
Or what about the headlines of September 2001?
Or it could be the headlines of the dot-com bust or the bursting of the housing bubble.
Actually, it’s all of the above.
Since beginning our stewardship of the GuideStone® ministry in 1997, we have seen some tremendous gains in the stock market — and some incredible challenges, as well. But through it all, certain truths have remained in focus over the last 23 years, truths that can be witnessed with any look-back, even including the 1930s and the height of the Great Depression.
Let’s go to our beginning for a moment to get the full picture.
When we joined what was then the Annuity Board of the Southern Baptist Convention those years ago, we were nearing the end of an incredible 12.8-year-long bull market. During that time, beginning November 30, 1987, and running until August 31, 2000, the market, as measured by the S&P 500®, returned an incredible 816.5%, or an annualized 19.0%. That incredible bull market started just over a month from what we then called Black Monday — October 19, 1987 — when the markets lost 20% of their value in a single day.
Since the beginning of the most recent bull market run — March 2009 through February 29, 2020 — the S&P 500® rose more than 400%, or an annualized rate of 15.87%.
But today, we once again find ourselves in a bear market. It may last a while, or it might not — we just don’t know. Since the end of the Great Depression, the longest bear market lasted 2.1 years in the early 2000s; the shortest, at the end of the Reagan years, was only three months, including October 19, 1987.
What then should we do with this information? Two things:
The coronavirus pandemic is a new challenge, but we have faced challenges before and will face them again. The days ahead contain many unknowns, and perhaps some dark days await. We are not wringing our hands even though we are washing them with more regularity. This much we know to be true, though: None of this captures God by surprise — and in His timing, we have faith that like in days before, He will bring us through to the other side.
O.S. Hawkins is president and chief executive officer of GuideStone Financial Resources of the Southern Baptist Convention®.