It's been a long time now in which commentators have been predicting the end of the Bull Market in America. That Bull is now approaching a decade, and is generally credited as being the 1st or 2nd longest in history, depending how you measure such things. With each market pullback along the way many analysts and commentators have predicted the decline was the beginning of the end of the Bull run. Other commentators have said that no, the decline was just a market pullback, to be quickly resumed by new heights and new highs. And until now it's been those latter soothsayers that have been right. For nearly ten years, the U.S. stock market has defined the naysayers. And for nearly ten years the market has had the Federal Reserve and its near-zero percent interest rate scheme to inflate the market, and the economy, and keep any declines with either contained. But as the Fed has finally relaxed its iron grip on interest rates a bit over the past couple years, the Bull has started to look weary. With the U.S. stock market ever more entwined with its overall economy, if this modest market decline turns into meltdown, the economy will expose its fundamentals as it loses the crutch of its booming stock market to support it.
At the beginning of this year I wrote a series of five articles on the state of healthcare, medical spending, and health outcomes around the world. Through that research I found that a country's wealth and the level of its healthcare spending are both highly correlated with healthcare outcomes such as life expectancy (see graph below). Within that strong correlation, we find that some countries strongly outperform lifespan expectations based on their wealth and healthcare spending, while others underperform. Among the wealthiest, highest-spending nations, the U.S. is far and away the worst in terms of average life expectancy compared to the level of its wealth or healthcare spending. Even worse perhaps, is that while average lifespans around the world continue to increase, those in the U.S. have flattened and even declined. Despite the U.S. continuing to spend record amounts on its medical care, and more than any other country, lately, we are not seeing corresponding improvements in Americans' health compared to other countries.
David A. Pace, CFA
Note: These comments and articles are for informational purposes only. Nothing in these articles are meant to provide specific investment advice and are not a substitute for professional advice from a qualified adviser. Since every investor's investment and personal circumstances are unique, he or she should always enlist the help of a competent and trustworthy professional in addressing their financial needs.