how bear markets work

I have been studying the markets for years trying to understand how they work,especially bear markets.

The bear market is almost the perfect creation.

It works so brilliantly.

It can be very subtle,then very brutal.

It is designed to take everyones money.

It lulls people into total complacency then attacks.

When you think you understand how it all works,it changes.

It works on your emotions over and over until you literally don't know which way is up.

The rally from the March lows lingered longer than most folks thought possible,lulling everyone into a false sense of security,then whack, a brutal sell off that caught most (not all)punters off guard.

Most folks were thinking it was just a much needed correction,but the bear had other ideas.

The correction crowd are now trapped and are hoping for a bounce.

Hope is the bears favorite emotion.

My reading of events suggest we just continue lower and lower and maybe even crash from here.(McHugh says we may bounce from here but I would sell any rally)

A continued sell off would do the most damage.Thats what bear markets are about.

Inflicting the most damage to the most amount of people.

The bear has also done his job of convincing most folks that the market always come back (rally off the March lows is evidence of this)but this time round folks may not panic and sell at the perceived bottom,rather this time round they will bravely hold their nerve as the market moves ever lower.Clever bear!

The conditions are perfect for a 2 to 3 year bear market that will grind lower and lower until folks eventually throw in the towel and vow to never , ever buy shares again.

The bears work will then be done.

That will be the time that you should be buying shares as the new bull market starts.

The bear market is brutal,it is very clever and most people will do well to survive it.

Being a bear doesn't actually make it any easier,in fact I would say it makes it even harder.

I knew the markets were going to be smashed but it is too dangerous to short at these levels.

You need balls of steel to stay short and I give kudos to those that did so.

I am too old these days and can't stand the stress of it all.

I will stay in cash and watch for quality stocks that can be bought at bargain prices but judging by whats happening I could be waiting for awhile.

The world is in big trouble.

It will get very ugly.

Life will go on as folks are fond of reminding me,but it will not be like the good old days,it will be very,very hard.