Yet a bear market is likely coming. Even with recent declines in the S&P 500, market valuations “still look a bit rich,” he said. The benchmark is “trading at a premium to its long-term average.”

However, he has yet to see a point where he is “comfortable saying the bear market is here,” he said. He does not see the “capitulation that we normally see,” and investors are not yet saying, “Just get me out!”

For the next year, in fact, he forecasts the beginning of an upswing. Some of that cautious optimism comes from reviewing historical election data—the “bump” that comes after the votes have been counted.

In midterm election years, he said, the second and third quarters are usually the worst performing. But in the fourth quarter, and into the first quarter of the following year after the election, markets tend to pop and volatility declines.

Since World War II, he said, the market has risen between October 31 of a midterm election year and October 31 of the following year.

Of course, investors are still rightly wary of the Fed’s monetary tightening, the growing risk of recession and the war in Ukraine. All these could and probably will provoke a bear market. Just not yet.

To be sure, historical data can be complicated and misleading.

“Historically,” he said, “the market does better when there’s a Democrat in the White House. But it also does better when Republicans control the House.”

Next year, both will be true.

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