Periods of high growth and low growth

Periods of high growth and low growth are not uncommon. For example, look at how the world went from the great 1920s to the Great Depression in the 1930s.

Investor Howard Marks discusses the concept of cycles in his book, Mastering The Market Cycle. He states that the economy grows, on average, at a consistent pace. The economy will get stimulated and make people take more risks and consume more. In turn, this period often causes inflation and slows things down.

Recessions and slowdowns are normal. However, when you invest long-term, these fluctuations won’t harm you.