re: When I started investing, 100 million was a really big day - not any more! etc.......
Yes there are things that have changed.
Volume commissions, Where / how you trade, the changes in these methods are not important.
Technology change is not important.
In 1928, the telephone was the new technology, I think the computer is nothing compared to the telephone in terms of evolutionary technology.
As for valuation measures, They are not important in and of them selves.
What the valuation measures tell us is where we are in the CYCLE that never changes.
The valuation cycle goes up and it goes down. If these numbers were low, and going lower, then we would know we were approaching the end of the decline.
Conversely they are high and going higher. This means we are getting closer to the end of the up cycle.
That never changes.
As for those that were always preparing for the worst that never came,
The reason it never came is they never let things get out of hand. By never letting the country get ahead of itself, they built a huge foundation for the baby boomers to run amuck.
These boomers do not prepare for anything. Just as generations before them in a similar situation did. Times change, People don't. We get smarter, and like to think we are smarter than those that came before us. But those that came before us were smarter too. They inevitably made some mistake that we are convinced we can avoid because we are smarter.
Well just as those before us prevented disaster by preparing for it, Today, We will cause disaster simply by not expecting it. Today's focus on inflation will make sure we don't have an inflation problem. The problem is that in our efforts to avoid inflation, the powers that be will most likely cause Deflation. An enemy that is just as evil as the other. But we have spent a generation dealing with the opposite.
When Deflation shows up "in the numbers", it will be way to late to reverse the trend which no one knows how to stop.
WW II is what really got the US out of it last time. I don't know about you, but I don't want to have to go through that.
These are the things that never change; People, Fear, Greed, Hope, Dispare, complatency.
These are what ultimately guide the market. They don't change, we can't stop them. Your dad will ultimately be right.
He may or may not be here when it happens, The all time great "I told you so." I hope All those that think this way are here to say that.
One think is for certain, You and I will be here.
We will have a myriad of ways to deal with it. I hope we all choose the correct methods.
Jim |
