Whoa Paul,lets look at the facts. You, I and Jeffery Bash may be the few who lived through the 60s and 70s markets. I believe Jeffery's caution is well founded, but agree with you that prudent buy decisions are still warranted since inaction may be more costly than action. First the facts from recent history based on a rather imprecise reading of yahoo charts(log scales hard to read). During 87 bear, dj65 down 25%, Russell 2000 down 38%. During gulf war correction, dj65 down 17 1/2 % and Russell down 28%. Russell may not represent value stocks but sure is a good proxy. Moreover, no one under 40 has ever seen a bear market. The recent experience of the nikei may be closer to a true bear. Here is another interesting fact, the nikei dipped twice in the past 5 years ,22 1/2% and 27 1/2 % , recovering and dipping, the behavior of a secular bear. Guess what over priced (p/bv,etc) Toyota did during these dips? Down only 5 and 11 %. Every good mutual fund manager in Japan feels that he must own Toyota. So if my reading of Jeffery is right the premise is that IF, big IF, a real bear comes along then value holdings are not immune. In fact it is my opinion that if the stocks being held are not quality companies they will be hit harder than microsoft, intel and cisco. Quality and diversification are key attributes of a good investment program.
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