As we enter the dog days of summer, the S&P 500 has pulled back but is within 1% of a record high. As always, the headline index number never tells the full story. While the index hovers around its high, that’s not the case for many of the companies that make up the index.
- 27% in a technical bear market, meaning price 20%+ below high
- 57% in a technical correction, meaning price 10%+ below high
- 42% below 200 day moving average, meaning effectively an annual loss
A pessimist would see a market top with deteriorating conditions.
An optimist would see the potential for further rebound.
I see the status quo. If there’s a decline, I have cash reserves to buy the dip. If the market trades higher, I plan to continue investing in companies that are favored by the long term trend of the convergence of industry with technology- Industrial Digitization.
Note the below chart from the Federal Reserve which tracks Industrial Manufacturing construction. Its growth is tapering off, but the magnitude of spending is still spectacular! And this spending doesn’t even include construction for non-manufacturing sites like AI data centers and related electrification infrastructure. We’re in the early innings of a USA centric manufacturing resurgence.
If you’d like to hear more about my thoughts on Industrial Digitization, please listen to a discussion I recently had with my friend Andrew Horowitz on the Disciplined Investor Podcast:
https://thedisciplinedinvestor.com/blog/2025/07/06/tdi-podcast-industrial-digitization-928/
Learn more about Investable Wealth LLC at: About the Firm
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