Investing is challenging: markets frequently produce outcomes that expose the folly of most investors and humble even the most successful and confident participants. Bernard Baruch, who built his fortune through speculation in the early 1900s, famously agreed, “The main purpose of the stock market is to make fools of as many men as possible.” 

Do you remember what was in the air ahead of the bear market low in October 2022? An economic recession was so widely anticipated that the ensuing escape from US stocks and bonds erased $12 trillion in value. Asking if we were “Feeling unwell?”, Bloomberg BusinessWeek put a vomit bag on its cover imprinted with the words “For market upheaval, economic turbulence and other discomforts.”

There was a monstrous wall of worry: a hawkish Fed, the Russia–Ukraine conflict, Europe’s energy crisis, the chronic political flare-ups stemming from China and Taiwan, and the dangers of climate change. Bridgewater’s co-CIO Greg Jensen predicted stocks and bonds would fall another 25 percent. When asked how to invest in this market, he said that “you are not going to be able to totally avoid this.”

Many economists believed that the Fed’s rapid interest rate hikes aimed at taming inflation would trigger high unemployment and a recession, as they had in the 1970s. A Bloomberg economic model fore