Abridged Version Foundations: Performance in the Next Bear Market & the Caldera Under S. Park & Wall
Detailed study of leaders versus broken stocks, market breadth and what it means for performance in the next bear market
Abridged Version Foundations: Performance in the Next Bear Market & the Caldera Under S. Park & Wall
Detailed study of leaders versus broken stocks, market breadth and what it means for performance in the next bear market
Michael Burry
Oct 19, 2026
∙
Paid
162
11
12
Share
This morning, I present an abridged version of the article below.
Foundations: Performance in the Next Bear Market & the Caldera Under S. Park & Wall
Michael Burry
·
Oct 17
I hope you enjoyed last week’s Short Thoughts piece, The AI Cloud Oligopoly, Stages of Grief & a Flashing Bear Market Indicator.
Read full story
The Abridged version keeps the essence and much of the visual content, each of which requires study for full understanding. Brought from over 6000 words down to under 1500, a lot of context is unavoidably lost, so I still recommend reading the full article.
With that said, let’s get started with the Abridged version of this Foundations piece.
Recently, on
October 6
th
,
the S&P 500 closed at a record high that looks no different than the high on June 2, 2026, or the one on August 13, 2026. Below, see the red arrows.
Vanilla.
Inflation has become a concern again, and its effect on market returns has been a very big stock market problem for a very long time.
From 1966 to 1982, the S&P 500’s inflation-adjusted price fell about 53%, comparing annual-average levels and excluding dividends.
Similarly, from 1929 to 1949, roughly two decades spanning both the Great Depression and a great
deflation
, the real price return of the S&P 500 was negative 58%.
More recently, from the dot com/TMT top in 2000 through 2011, the real price return of the S&P 500 was roughly negative 40%.
Consider becoming a paid subscriber before rates go up up November 1
st
. Enjoy the $49 monthly or $479 annual rate for the life of your subscription by purchasing your subscription this month. Paid subscribers receive Feature Articles, Trading Posts, Short Thoughts, the best Chat on social media, and soon, our new portfolio feature, Portpourri, named after the paper I delivered as a kid. Remember the rate you sign up with is the rate you keep for the life of your subscription. Subscribe now!
This post is for paid subscribers
Subscribe
Already a paid subscriber?
Sign in
What did you think?
Your ratings and notes guide future recommendations automatically. Tell us what you loved or disliked and why.