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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club -- Ignore unavailable to you. Want to Upgrade?

To: lifeisgood who wrote (7161)	7/25/1999 6:27:00 PM
From: Math Junkie	Read Replies (1) \| Respond to of 15132

l.i.g., you have to draw the line somewhere. If you say that 19.6 is as good as twenty, then you could say, "well, OK, let's set the definition at 19%. Then if you had an 18% drop, someone could come along and say, well, 18% is as good as 19%, so really, we had a bear market, and so on. The point being, where do you stop with that process? If you have a model which, when back-tested, appears to have the ability to forecast a bear market, using a particular definition, and if you then start tweaking the definition, not only would you be guilty of exactly the kind of hedging that you and Herb have accused Bob of, but any attempt to maintain a model would degenerate into nonsense.

To: lifeisgood who wrote (7161)	7/25/1999 8:17:00 PM
From: Justa Werkenstiff	Respond to of 15132

LIG: Appreciate the effort but your response is lacking to be polite about it. Re: "Bob defines a bear market as a 20% drop." No, Brinker defines a bear market as a decline of 20% or more (20%, 30%, 40% or more) and lasting from six months to two years in duration. Now in this context, let's look at what you said: "Hypothetically, the market could tank 50%, and in 2 years recover and reach new highs. In this case, Bob could still claim he was correct and that staying fully invested was the right move (it would however be in conflict with his oft-stated intention never to ride out a bear market)." Now since Brinker's model is aimed at avoiding the bear market which is defined as I have noted, then your assertion would be totally impossible. If this were to happen as you have asserted above, we could all start a "Bash the Brinker" thread where we could all trash him 24/7. So all the would-be bashers will just have to be hopeful and patient for their scenario to play out. You have to be in it for the long term as they say. We can talk about the intermediate term correction issue once you have mastered that definition as well.