On November 6th, according to the Financial Association (edited by Huang Junzhi), at the Italy Tech Week held in Turin, Italy, Goldman Sachs CEO David Solomon severely warned investors that the stock market would not rise in a straight line, and many

He said in an interview, 'I think a lot of invested funds will ultimately fail to generate returns.'

Solomon mentioned his optimistic attitude towards artificial intelligence (AI), which has pushed Wall Street favorites such as Nvidia, Microsoft, Alphabet, and Palantir to astonishing heights. A large influx of funds has flowed into the development o

According to Solomon's observation, history shows that when a technology is newly emerging and yet to be widely accepted by the public, stock returns tend to be the highest.

"Markets are cyclical. Whenever a new technology experiences significant accelerated development, creating massive capital and thus spawning many interesting new companies, you typically see the market outperform its underlying value. But there will

He used the internet bubble as an example. From 1995 to 2000, the S&P 500 index steadily rose for five years, followed by a bubble burst and a sharp drop in the S&P 500 index.

Here are the annual returns of the S&P 500 Index during the periods of internet boom and bust.

1995: 34.1%

1996: 20.3%

31%

1998: 26.7%

19.5%

-10.1%

-13% in 2001

-23.4% in 2002

Solomon said, 'As a Wall Street professional, I made a lot of money during that time and lost a lot of money. I can affirm that it was indeed the best and worst period.'

A good argument is that today's bubble is not as serious as in 1999, because most of the best-performing companies are genuinely profitable. Although valuation metrics have expanded, they are far from the pre-music-stop level in 2020., still no exact

Solomon has experienced many events throughout his long career, including Black Monday in 1987, the savings and loan crisis in the late 1980s and early 1990s, the boom and bust of the internet, the Great Recession, the COVID-19 pandemic, and the bear

Solomon emphasized that investors should remember that the stock market is twists and turns, and over time it will take a winding upward path instead of a straight one. Significant declines will also occur during the formation of bubbles.

"They (investors) tend to consider the good things that may succeed and ignore the things that could go wrong that you should suspect," he added.

Of course, no one can accurately signal the top or bottom of the stock market, but any insider will tell you that pullbacks, adjustments, and bear markets are common. In terms of data, how often do pullbacks, adjustments, and bear markets occur? LPL

5%-10% callback: 3.4 times per year

Adjustment by 10-20%: once every year or once in two years

Over 20% bear market occurs every 3-4 years.