What's Preventing Another Lost Decade for Equities?

If someone had a stable job, they might be able to contribute throughout the lost decade, ending up having a return of more than 1%. The whole idea of someone buying at the top, and not buying until it reaches the top again isn’t necessarily a practical one.

nothing prevents another lost decade. It's entirely possible. That's one reason diversification, regular investing, and realistic return expectations are important. The strongest argument against a repeat isn't that it's impossible—it's that most investors aren't investing a lump sum at the exact market peak. Ongoing contributions during a flat or declining market can significantly improve long-term results.

World markets haven't been flat for more than 3 years consecutively in the last, idk, 80 years... maybe don't just invest in SP500?

I expect we will see longer than a lost decade. But that really only adversely affects those that are retired or soon to be retired. Those that are regularly investing for retirement have two things going on. One is the performance of the assets they had before the bear market and those will certainly recover before you retire assuming you are 45-50 or younger. But the other thing that happens is that your continued investing is much more profitable as you spend that 10-15 year bear market buying equities on sale so you make excellent returns as the bear market morphs into a bull market. I was 55 in 2000. And yes the $600,000 I had invested in 2000 did lose money, in fact bottoming out at $225,000. However that $225,000 had regrown to $600,000 by the time I retired in 2015. But most importantly the $20,000 or so I was investing each year in my 401k between 2000 and 2015 bought a lot more stock than it would have if that bad market had not been happening. So by the time I retired I had more than enough money to retire. So don't worry about a bad marker, embrace it. It actually will work for you.

the worst 12 year period for equity markets ever in recent years.

That's not what "ever" means.

I don't think anyone actually feels like a lost decade will never happen again. In fact it's highly likely that it will. The problem, as with most questions along this line, is timing. The thesis for future underperformance based on high valuations has been true for a while. In fact, the forward P/E ratio of the S&P 500 is right around where it peaked back in 2015. Now, what would have happened if you sat out of investing for the last 10 years based on fear of poor returns?

Just speaking personally, and this is not financial advice, but this is why I’m not dumping my target date funds for pure VOO. I still only have 10% bonds but it’ll scale to 20% over the next decade and while bonds have taken a beating the last 20 years, some return is better than none in case the S&P, which as you say feels awfully overbought, has another decade of death.

The retort to what I just said is, historically, I have to invest 16% a year to retire with the same amount as someone in 100% equities who invests only 10% annually.

Nothing is preventing it.

If you regress against historical valuation data, some might say the odds are pretty high.

Just a note, though, with dividends reinvested you’d recover a bit faster than what you wrote in your post.

I think those that are arguing for no more “lost decades” mainly point to the government interventionism that has become common after 2008. Yields are more firmly controlled now with QE/QT, and it seems like the government is more and more willing to deficit spend to prop up the stock market specifically. Which, anecdotally makes sense given that more and more Americans each year are dependent on the market for their retirement.

But there’s also no guarantee that is sustainable in the long term.

Now that Chuck Norris has passed away, absolutely nothing stands in the way of another lost decade.

Fact

Since 1930 there have been 3 lost decades 5h30s, the 70s and 2000 to 2013. Each lost decade had different triggers and there have been no changes to laws that would prevent it. The market appears to have about a 30 year cycle. Long bear market of 10 to15 years, followed by 10 to 15 year bulll market. I cannot say it will definitely happen or when but history says it is about time for another lost decade.

Retired 9/1/2018 no bonds. Individual stocks

Keep in mind that dotcom was a product of very unfortunate timing.

It started with unprecedented valuations and a mania, followed by a major terrorist attack, followed by entering into a 15+ year war in the middle east, followed by the biggest credit event since the Great Depression.

And even still it was back to breakeven even by year 13. That's the definition of resiliency.

What if dotcom had they gotten a "ChatGPT moment" instead of 9/11?

personally hope its not a slow drawn out process. Lets just pull the bandaid off and get it all over with.

In my mind I always think of morgan freemans speech at the end of deep impact and that we will bounce back (to steal gordon ramsays expression)

Funnily (?) enough, it is when the portfolio is hitting a new high (like during a massive growth) that people feel more comfortable retiring. Not after a major pullback.

When bonds are getting crushed by inflation and increased rates? (Don’t look at the perf of TLT for the past 7 years 🤣).

Thank goodness for VXUS though.

The S&P 500 the five years prior to 2000 was +155%, +28.5% annual return. If you planned in 1994 to retire in five years and were 60% S&P 500, your portfolio would have still more than doubled in those five years and you would have entered retirement in a way better position than you originally expected. As mentioned by many others, if you were still working and contributing from 2000-2012, you got 10% annual returns during that period due to "buying low" through that time

The burn rate math is the thing I can't get past. $30 billion over four quarters and then you raise $75 billion at IPO — that's not a war chest, that's about 2.5 years of runway if nothing changes. And capex isn't slowing down, xAI alone was $7.7 billion in just Q1 2026. At some point the Starlink revenue growth has to outrun the spending or this is just a very expensive bet on Elon finding a second gear.

The 95x revenue multiple is the other thing. I get that Starlink is genuinely impressive but 95x is pricing in a future that has to go basically perfectly. One bad quarter, one regulatory problem, one Elon distraction and that multiple compresses fast.

Not saying don't buy it. Just saying know what you're actually buying.

In theory, nothing. Plan accordingly. Too many people who've never seen a bear market think bonds are garbage.