The Sun Also Rises: Why I’m Optimistic in these Times

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In 1926, Ernest Hemingway published what most people consider his best novel, The Sun Also Rises. Like most Hemingway novels, it’s about real people and events from his life, but fictionalized, and like most Hemingway novels, its characters spend a lot of time being dark and depressed.

This year has been rather like a depressing Hemingway novel. At the beginning of 2022, we saw inflation rising, but it looked likely to subside soon. Then Russia invaded Ukraine and the price of some very important commodities shot dramatically higher all at once. Inflation eventually reached double digits in June, and the Federal Reserve moved aggressively to tame it.

So many dark signs arose. The yield curve inverted. Stocks declined to bear-market territory, and for the first time in memory, bonds entered a bear market at the same time.

And on and on the grind continued as we moved forward.

It’s easy to forget what Hemingway’s novel title points out—that the sun also rises.

Irony screams when one remembers that the man himself seems to have forgotten the title of his best novel. Hemingway took his own life in 1961. His fans may say I am unfair, because he suffered from injuries in a plane crash that left him in pain most of the time. After seven years of pain, he most likely gave up on the idea that the sun would rise again.

But here the analogy of Hemingway and his wonderful book title breaks down. We investors of 2022 may be as depressed as the characters in a Hemingway novel, but for us there is the very real likelihood that the sun will rise again and the depression and pain of 2022 will be behind us.

Some years ago, I looked back into the history of the stock market, specifically the S&P 500. I did a simple thing: I looked at the price on January 1st and on December 31st of each year. If it was higher at the end of the year than at the beginning, that was an up year. And of course the opposite was a down year. I looked back at the entire 20th century and found that in most decades, the stock market was up in 7 of 10 years. Sometimes it was up in 8 of 10 years.

Now, it’s entirely possible that life as we know it has completely changed. That the great American experiment with free enterprise and free markets is finally over and that life will not get better in future decades, that the American economy will no longer grow. I cannot rule out this possibility, but ask yourself, do you really believe it’s all over? I don’t.

And if you are like me, then we believe quite strongly that the sun also rises. The sun will once again shine on the markets.

Do I sound overly optimistic? Really, it’s just math. History suggests that each year has a 70 percent chance of the S&P 500 moving higher. So if I am bullish, I have a 70 percent chance of being right.

If you are a regular reader of this column, you may recall my description of a television show I saw 30 years ago—Wall $treet Week with Louis Rukeyser. Back in 1992, one of his guests was the famous mutual fund and international investing pioneer Sir John Templeton. At one point, Rukeyser asked him why, amongst all the horrible worries of the time, he was capable of optimism. Templeton replied, “There are always things to worry about. But life today is better than it was 30 years ago and it will be better 30 years from now than it is today.”

Sir John was 88 years old then. He didn’t live another 30 years to see that his vision turned out to be true. But his message is clear. Keep your eye on the big picture. Don’t get scared by today’s list of things to worry about, because there are always things to worry about. The list changes every year, but it never goes away.

Remember Sir John Templeton and remember Hemingway’s excellent book title, The Sun Also Rises.


Hal Masover is a Chartered Retirement Planning Counselor and a registered representative. His firm, Investment Insights, Inc is at 508 N 2nd Street, Suite 203, Fairfield, IA 52556. Securities offered through, Cambridge Investment Research, Inc, a Broker/Dealer, Member FINRA/SIPC. Investment Advisor Representative, Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Investment Insights, Inc & Cambridge are not affiliated. Comments and questions can be sent to These are the opinions of Hal Masover and not necessarily those of Cambridge, are for informational purposes only, and should not be construed or acted upon as individualized investment advice. Investing involves risk. Depending on the types of investments, there may be varying degrees of risk. Investors should be prepared to bear loss, including total loss of principal. Past performance is no guarantee of future results.

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