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To: Art Bechhoefer who wrote (121920)	7/22/2002 4:40:50 PM
From: Wyätt Gwyön	Read Replies (3) \| Respond to of 152472

As to index stocks, the problem I have is that none of the so-called efficient market theories use a database that is truly representative of the universe of stocks, or even some subset of the universe not sure what you're referring to, Art. there're indexes for the total market (Wilshire 5K) as well as all sorts of subsets, sliced and diced a million ways. Therefore, the conclusions drawn about index funds doing just as well, if not better over the long term than individual stocks, on the grounds that on average you can't beat the market, are just a lot of horse manure Art, with all due respect, you're wrong. passive strategies are obviously much better than most active strategies. this is not something that people who pay attention to these things even debate anymore. the Vanguard funds and DFA funds, which are real-life funds, have closely tracked their benchmarks and kicked the crap out of the majority of their active competitors over just about every time period. and the longer the time period, the fewer people beat the market. e.g., i believe Bill Miller of Legg Mason is the ONLY large-cap mutual fund manager who has bested the SPX every year for MORE THAN A DECADE. NOBODY has done it for more than 12 years or so in a row... so do you really think you're smarter than EVERY MUTUAL FUND MANAGER IN THE WORLD? do you really think that you're smarter than EVERY INSTITUTIONAL INVESTOR IN THE WORLD? because that's what you need to be in order to beat the market. if that's you, well, you're one smart guy! that doesn't mean some people won't beat the indexes--of course they will. but some people will also win $57 million in the lottery. it's the same thing--just pure luck. except at least the lottery winner recognizes it and doesn't try to repeat the feat (and end up losing his winnings in the process). back in 1999, a lot of people on this thread had great returns (me included). those who thought it was more than luck persisted in their delusions until they gave back the majority of their winnings. those who realized they were just lucky lottery winners kept their winnings. it's quite simple.

To: Art Bechhoefer who wrote (121920)	7/22/2002 5:11:37 PM
From: waverider	Read Replies (2) \| Respond to of 152472

Art, for God's sake...who cares about performance in a company if their stock continually drops? Aren't we in this game to make money on stocks??? Unless you are on their payroll, there is absolutely no reason to give a rat's a-- what their earnings (forgetting pro forma for now) are doing IF you are interested in making money in their stock WHEN THE STOCK HAS BEEN IN A MAJOR DOWNTREND FOR OVER TWO YEARS! Art, you belong as an employee or a corporate officer. You have the correct view of things in that department...but not an investor intending to make money in the stock market. wr