Peter Schiff: Most Stocks Are in a Bear Market Despite AI Successes

Peter Schiff claims that most American stocks are in a bear market. According to his data, 479 stocks have reached 52-week lows, while only 60 have hit new highs, giving a ratio of eight to one. The economist and gold advocate wrote about this on X on October 14, 2026. Schiff notes that market growth is often presented as an achievement of the current administration, even though most stocks are actually declining.

The S&P 500 index in 2026 has gained about 14%, according to Goldman Sachs, but the growth is concentrated in a narrow circle of stocks. Goldman strategist Ben Snider in a September note assessed the median S&P 500 stock as 16% below its 52-week high. Market breadth is at its weakest level since the dot-com bubble. A similar concentration is seen in earnings: Schwab Center for Financial Research's chief investment strategist Liz Ann Sonders noted in August that Nvidia and memory maker Micron will account for a third of the S&P 500's earnings growth in 2026.

However, a 52-week low is not a 20% decline, the usual bear market threshold. Since the median stock in the index is 16% below its peak, less than half of the participants have crossed the threshold. Schiff's data records new lows, not the depth of losses. Goldman sees an alternative scenario: Snider wrote that lagging stocks could catch up if economic uncertainty eases.

Rates complicate the picture. Inflation in the US reached 3.7% in September against a forecast of 3.6%, increasing the chances of another Fed rate hike, which meets on October 27-28. At the same time, Goldman notes that high rates and doubts about AI companies' profits have reduced the index's forward earnings multiplier to 19 from 22 – this is an indicator of how much investors are paying for a dollar of expected earnings.

For index investors, this gap is significant. A capitalization-weighted fund gives the greatest weight to the largest companies and relies on AI stocks, while the typical stock remains below its peak. Whether the laggards will catch up with the leaders or the leaders will decline will determine how the index and the typical stock converge.