The Next Market Run Could Last 20 Years: Here's Why I Think So

No one's talking about it—not that I've seen or heard anyway. But I think the stock market is on the brink of a massive, long term growth spurt. Despite any economic pressures we might face, this could last for at least the next 20 years.

Now, I admit, I have zero data to back this up. It's purely my gut feeling. And yes, I might be a little crazy. But hear me out: Two words.

Baby boomers.

I mean, think about it—if there's one group poised to rake in truckloads of cash, it's the baby boomers. And let me tell you, there are a lot of them out there.

Now, I'm not suggesting that every single baby boomer is going to glide into retirement with a golden parachute. We know the sobering statistics about many entering their golden years financially unprepared. But still, there's plenty to consider that teases the idea of a significant influx of spendable cash hitting the market over the next two decades.

How many billions—maybe even trillions—have been locked up in 401k plans since the 1980s, now coming due for distribution? What about all those pensions and Social Security checks being cashed in? And let's not forget the baby boomers downsizing their homes, unleashing loads of cash tied up in unrealized equity.

The money floodgates are about to open, folks. In fact, they might have already begun to flow. The stock market has been on an incredible tear for a long time, marking one of the longest bull runs in history. The money has to be coming from somewhere, and a good chunk of it might just be coming from baby boomers already.

It's worth keeping in mind as well that these baby boomers are well past their saving years. They've already done that and now they're ready to enjoy the fruits of their labors, which means they will likely be more freewheeling with their spending compared to those still working and saving for their futures.

They know they can't take their loot with them when they leave this Earth, so they're going to want to have a little fun while they can.

Again, let's not ignore the very real fact that many will still struggle through their retirement years. Those darned statistics. So, it won't be all fun and games for everyone. But that doesn't negate the fact that there's a lot of old money set to reenter the markets after being locked up for so long.

The money is coming. It's out there, sitting stagnant, with no choice but to be released.

It's not to suggest we should just throw the baby out with the bathwater and go all in and flood the markets with investable cash. It's simply something to consider about the future prospects and potential for more upside than we might typically see in the markets—the money has to go somewhere, and that means it has to be spent, and that means businesses will benefit from that spending and so will investors.

Maybe. Just maybe. But I have a strong sense it's probably true.

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© 2024 Jim Bauer