Home » Resources » Understanding Credit » Bull vs. Bear Markets: What They Are and What We’re in Right NowIf you’ve been keeping up with recent events, you’ve likely heard of bull and bear market trends and may even have a general understanding of what they are. In this article, we’re going to cover the basics of bull and bear markets, the status of the current market, past bull and bear market trends, and more. To ensure that you have a detailed understanding of the market we’ve headed into and what that means for you, continue reading below.What is a bull market?When you think of a bull market, the phrase “investor optimism” should pop into your head. During bull markets, unemployment is generally low, the prices of assets like stocks and securities rise (or are expected to rise), and the economy is doing well as a result. While in the midst of a bull market trend, investors are typically optimistic that the trend will continue, and are happy to invest their money in companies to keep their wallets and the economy growing.Generally, bull markets are designated as a rise of 20% or more from a near-term low. The most recent bull market was the longest in modern history, clocking in over 10 years – from the 2008-09 recession up to March of 2020, when it quickly began falling again – but more on that later.An easy way to remember that a bull market signifies a growing economy is to picture how a bull attacks: they charge at a target while holding their heads down low, then swipe their horns up at the last moment – similar to how stock prices “swipe up” during a bull market.What is a bear market?To better understand what a bear market is, all you really have to do is take the idea of a bull market and turn it on its head. During these times, investors’ confidence that the market will experience growth is low – they’ll typically sell off their stocks in fear of losses, as cash is a more stable asset than securities when the market is volatile.In addition, unemployment is generally higher during bear markets, and the prices of assets start to fall (or are expected to fall). It’s worth noting that both of these factors could be telltale signs that a recession is approaching. Similar to bull markets, bear markets are usually called when stock prices drop 20% or more from a near-term high.Need a trick to remember what a bear market signifies in the economy? Once again, let’s take a second to think about how the animal attacks. When bears attack, they often stand up on two feet and swipe their paws down, leveraging their weight to land devastating blows. The downward motion of the bear’s paw illustrates exactly what happens to stock prices during a bear market – they go down, sometimes rapidly.What type of market are we in right now?If you’ve been keeping up with the news, you probably know that in March of 2020, the U.S. officially entered a bear market. It may come as no surprise that the ongoing COVID-19 pandemic played a massive role in this economic downturn, which forced many organizations and businesses to shut their doors for both employees and customers with little to no warning.If you invest for a living, are a casual investor, or just keep up on market trends, there’s no denying that bear markets hurt. While it’s painful to watch assets that have grown for so long in a state of free fall, believe it or not, there is a light at the end of the tunnel – according to Hartford Funds, bear markets tend to be short-lived, only lasting around 10 months on average. Bull markets, on the other hand, tend to last around 2.75 years on average.Are bear markets normal?Since 1928, there have been 26 bull markets, and the country’s 26th bear market has just begun. The country has only experienced bear markets a total of 20.5 of the last 92 years, meaning that stocks were on the rise the other 71.5. As bad as things seem now, statistics show that we’re going to make it out of this rut just fine, just like we have every other time.So, keep your head on straight – this is just another storm we’ll have to weather together. If we’re lucky, we might find out that we’re all the better for it.