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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (43747)	1/2/2006 9:05:51 AM
From: Casaubon	Read Replies (1) \| Respond to of 116555

Mish, Dollar cost averaging presupposes that you will always have an income through the downtrends and long recovery times. It also does not account for periods of time of under-employment, when saving is too difficult. The way that dollar cost averaging works is that one must necessarily purchase larger quantities of cheap stock during the downturns to abrogate poorly timed, higher priced purchases. The methodology does not ever consider the possibility of unemployment during those downturns. This is the unspoken fallacy of the surefire method to wealth, called dollar cost averaging.