• Products
  • Insights
  • Practice Management
  • Resources
  • About Us

While the lava lamps and folk music of the time aren’t in vogue anymore, Bob Dylan’s anthem, “The Times, They Are A-Changin’” seems just as fitting today as it was in the tumultuous 1960s when it was written. It may feel as if we’re living in uncharted waters now: sky-high inflation, political polarization, geopolitical tensions, … but are the issues we’re facing today really that unprecedented?

The truth is that we’ve overcome challenges and tumult before—both from an economic and cultural standpoint. In fact, the challenges we’re facing today are echoes of strife from prior decades.

For example, inflation was a standout feature of the late 1970s and early 1980s, but it moderated significantly in the decades following. This is why many Americans haven’t dealt with high inflation in their adult lives until now, when pent-up demand from the COVID-19 pandemic is meeting ongoing supply-chain disruptions and pushing inflation rapidly higher. Add in a military conflict in Europe between Ukraine and Russia, a huge supplier of global oil, and investors are feeling significant pain at the pump for the first time in many years.

In the 1980s, we were frightened by a new, rapidly spreading virus we didn’t fully understand: HIV/AIDS. Decades later, a novel treatment has successfully cured multiple HIV patients—just as we’re trying to determine what the world will look like as the COVID-19 pandemic becomes endemic, moving from the foreground to the background of our everyday lives.

 

But People—And Markets—Are Resilient

The challenges we’ve faced have taken place in the midst of market volatility, bear markets, bull markets, inflation, stagflation, energy crises, and heightened geopolitical tensions. In other words, we’ve been through the social and economic wringer before, yet we’ve persevered.

Most telling of all? During the last 6 decades, only one (the 2000s, in the wake of the Global Financial Crisis) generated negative stock returns for the entire decade; bonds generated positive performance in every decade.

 
 Average Annual Return (%)
  Decade   Bonds Stocks
1960s 3.5 7.8
1970s 7.0 5.9
1980s 12.4 17.6
1990s 7.7 18.2
2000s 6.3 -1.0
2010s 3.8 13.6

Past performance does not guarantee future results. Stocks are represented by the S&P 500 Index, which is a market capitalization-weighted price index composed of 500 widely held common stocks, using data calculated by Ibbotson
Associates. Historical data from 1929 to 1969 is calculated by Ibbotson. Bonds are represented by the IA SBBI LT Government Index, which measures the performance of a single issue of outstanding US Treasury note with a maturity term of around 5.5 years. Indices are unmanaged and unavailable for direct investment. Source: Morningstar, 5/23.

In Other Words

For clients who are concerned about the state of markets today, historical perspective such as this can help them feel more confident—and stay invested. A look back at history shows that despite all manner of challenges, financial markets have historically moved onward and upward, as has our nation as a whole.

 

 

Financial Professional Next Steps

 

1 This article is based on our popular The Times They Are A-Changin'  brochure. Click here to access additional content to share.

 

Important Risks: Investing involves risk, including the possible loss of principal. • Fixed income security risks include credit, liquidity, call, duration, and interest-rate risk. As interest rates rise, bond prices generally fall.

2930287 

The material on this site is for informational and educational purposes only. The material should not be considered tax or legal advice and is not to be relied on as a forecast. The material is also not a recommendation or advice regarding any particular security, strategy or product. Hartford Funds does not represent that any products or strategies discussed are appropriate for any particular investor so investors should seek their own professional advice before investing. Hartford Funds does not serve as a fiduciary. Content is current as of the publication date or date indicated, and may be superseded by subsequent market and economic conditions.

Investing involves risk, including the possible loss of principal. Investors should carefully consider a fund's investment objectives, risks, charges and expenses. This and other important information is contained in the mutual fund, or ETF summary prospectus and/or prospectus, which can be obtained from a financial professional and should be read carefully before investing.

Mutual funds are distributed by Hartford Funds Distributors, LLC (HFD), Member FINRA|SIPC. ETFs are distributed by ALPS Distributors, Inc. (ALPS). Advisory services may be provided by Hartford Funds Management Company, LLC (HFMC) or its wholly owned subsidiary, Lattice Strategies LLC (Lattice). Certain funds are sub-advised by Wellington Management Company LLP and/or Schroder Investment Management North America Inc (SIMNA). Schroder Investment Management North America Ltd. (SIMNA Ltd) serves as a secondary sub-adviser to certain funds. HFMC, Lattice, Wellington Management, SIMNA, and SIMNA Ltd. are all SEC registered investment advisers. Hartford Funds refers to HFD, Lattice, and HFMC, which are not affiliated with any sub-adviser or ALPS. The funds and other products referred to on this Site may be offered and sold only to persons in the United States and its territories.

© Copyright 2023 Hartford Funds Management Group, Inc. All Rights Reserved. Not FDIC Insured | No Bank Guarantee | May Lose Value