Sally Vix wrote:
Ghost of Igloi wrote:
Investors piled in the Tech stocks in summer of 2000 right before the market took another leg down.
Ghost, hope you had a nice weekend. But, again you are cherry-picking 2000 again. Oh! It just happens to be the year immediately preceding the worst three-year run of stocks in the last 30 years. 2003 the S & P had a REAL rate of return (even accounting for inflation) of over 26%. Think about that ... 26% even taking into account inflation. But your baseline is ALWAYS the year 2000. Simply because those three years are terrible. Look at the far right column beginning in 2003 and you can see how fabulously the market has done since with the lone bad year being 2008. And these are not simply returns but INFLATION-ADJUSTED returns. And does not even account for dividends which would be another 1% each year.
What's your preferred time span then, 1910 to present? I'm not trying to defend Igy here but it's amazing how many people are like "buy and hold, buy and hold!" As the saying goes, it works, till it doesn't. Modern monetary policy is constantly shifting with new economic theories.
Exhibit A : go look at the Nikkei 225. The Bank of Japan is the #1 creator/redeemer of almost all of the ETFs traded on the Nikkei and it's not even a close race. They're a majority or significant shareholder of like 90% of companies listed!
Oh! But Japan has an aging crisis, and strict immigration laws that make it hard for cheap labor, right? Kinda sounds like what the US might be facing soon if you ask me.
Igy, quit claiming buy and hold is bad just because it hasn't worked well for a selected time frame and explain why buy and hold won't work for the immediate future.
Everyone else, quit saying buy and hold is good because it has worked well for a selected time frame and explain why it's still a good idea for investors going forward.