Macro & Cycles
How recessions, inflation, interest rates, and market regimes shape long-run returns for serious investors.
Most retail investing advice treats the broad economic environment as background noise. The empirical record says otherwise. The macro context an investor lives through shapes returns in ways individual stock picking cannot offset. Investors who began in 1982 (entering a 17-year bull market) and investors who began in 2000 (entering a lost decade) ended up with very different outcomes despite similar discipline.
This cluster covers the macro context. What recessions actually are and how to think about them. How inflation affects stock returns. What interest rates do to valuations. How long-term market regimes shift across decades. What yield curves tell you (and what they don't). Educational only, framework over forecast.
Recommended reading order
5 articles, ordered for sequential learning. Skim by title if you already know the basics.
- 1What Is a Recession and Why It Matters for Long-Term Investors
The definition, the history, and the empirical record on what recessions actually do to equity portfolios. Spoiler: less than headlines suggest, more than people remember.
Read → - 2Inflation and Stock Returns: The Empirical Record
Stocks are sometimes called the best inflation hedge. The data is more nuanced than the slogan. What 75 years of inflation regimes actually did to equity returns.
Read → - 3Interest Rates and Stock Valuations: How the Fed Actually Moves Markets
The mechanism by which Fed policy reaches stock prices, why it works through valuations not earnings, and what to actually pay attention to in rate cycles.
Read → - 4Market Regimes: How Long-Term Cycles Shape Returns
Different decades behave differently. The 1980s-90s ran one regime, the 2000s ran another, the 2010s a third. Understanding which regime you're in changes how you allocate.
Read → - 5What Yield Curves Tell Us (And What They Don't)
The inverted yield curve has predicted every modern US recession. It has also generated false positives. The honest version of what the curve actually signals.
Read →
Core 20
The core 20 model portfolio applies the methodology this topic covers. 14.7% CAGR over the backtest, +2.2% alpha vs the S&P 500.
Explore Core 20→Other topics
The Market Normality Report
Where today’s S&P 500 sits in 75 years of history. Twelve brand-designed pages. Print-ready. Free.
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