It’s official: We really are living through the 1970s again.

At least, that’s the point of a recent report from Ned Davis Research that compares returns in today’s markets to those from 40 years ago. And that’s not a good thing.

From Bloomberg:

“Market statisticians are falling over each other in 2018 to describe the pain being felt across asset classes. One venerable shop frames it this way: Things haven’t been this bad since Richard Nixon’s presidency.

Ned Davis Research puts markets into eight big asset classes — everything from bonds to U.S. and international stocks to commodities. And not a single one of them is on track to post a return this year of more than 5 percent, a phenomenon last observed in 1972, according to Ed Clissold, a strategist at the firm.

In terms of losses, investors have seen far worse. But going by the breadth of assets failing to deliver upside, 2018 is starting to look historic.

Nothing’s working, not large or small-cap stocks in the U.S., not international or emerging equities, not Treasuries, investment-grade bonds, commodities or real estate. Most of them are down, and the ones that are up are doing so by percentages in the low single-digits.

That’s all but unique in history. Normally when something falls, something else gains. Amid the financial catastrophe of 2008, Treasuries rallied. In 1974, commodities were a bright spot. In 2002, it was REITs. In 2018, there’s nowhere to run.”

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There are a lot of theories about what’s happening — the report’s author blames the end of central bank stimulus and rising interest rates — but the fact remains that market returns aren’t what they used to be.

And that’s where non-correlation comes into play.

Non-correlated assets are any that are not correlated to the broader markets. These typically include things like gold, real estate, hedge funds, etc, but venture capital is on the list as well.

Why? Because venture capital — the process of investing in emerging companies — has outperformed every other asset class, over most holding periods, since it was first institutionalized in 1946.

According to a report by the Kauffman Foundation, an analysis of over 3,000 early stage investments, by over 500 individuals, resulted in over 1,000 exits and generated a 27% Internal Rate of Return over a 3.5 year period.

This return is well above public market average returns.

And it is not correlated to whatever’s happening in the broader markets. Despite generally benefitting from cyclical upswings in the economy/market and being negatively affected by downturns, the process of solving substantive long-term issues (curing cancer, addressing climate change, etc.), the long-term nature of the harvesting period, and longer-term pricing mechanisms, allows venture capital investments to be substantially uncorrelated with other investments in one’s portfolio.

That’s why the innovation economy is work paying attention to, no matter what happens in the news or the stock market.