Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: energyplay who wrote (50478)	5/26/2009 7:03:09 PM
From: TobagoJack	2 Recommendations Read Replies (2) \| Respond to of 217501

just in in-tray player 1 I've now seen it all. Jeremy Siegel just said on cnbc that equities are NOT riskier than bonds.He also agreed that they have underperformed bonds for the last 40 years,yet still tried to make the case for 'stocks for the long term'. OK,let's assume the next 40 years repeats the past 40 years (unlikely in my view). If you knew both asset classes would yield the same,would you prefer to be high in the capital structure or at the very bottom? Somebody get rid of this guy before he destroys the retirement incomes of yet another generation and poisons the minds of more Princeton kids. player 2 well, he wrote a book entitled 'stocks for the long run' - in which he basically denies that cycles matter. it's a typical product of the late bull market era, similar to the Glassman/Hasset 'Dow 36,000' book. they all defend their lame forecasting record now by pointing to 'we always said 'long term'. That will not be much of a consolation to those facing retirement with their 401 K's cut in half i fear. close to every bull market's end there is a proliferation of arguments as to why there will never be a down cycle again - this is just as reliable as the fact that the secular cycles repeat over and over again anyway. player 1 Thanks to guys like JS a lot of people are now relying on their 201K plans for a sorry retirement player 3 He is a nice person but totally out of touch with reality - like most academics...I had dinner with him three years ago. He has stock market returns going back to 1800. I asked him: at the time they had 90% banking shares and canal shares in the average. 95% of them went bust in the 1840/41 depression. So if I bought shares then what would my return be??? He had no answer.... Same for investors who bought railroad stocks in the 1840s and 1850s. By 1895, 95% were bust. I just love these hopeless academics .... some of them even poison the investment world by managing money ..... or run central banks...(even worse). player 2 many became 'long term investors' just when the time was ripe to either become a 'trader' or be out of the market altogether. always happens that way though - at the cycle bottoms the bulls are ignored, and at the tops the bears are ignored. as an aside, Siegel is an icon of the bull market era, and as such worth watching. when he no longer gets invited to do TV interviews the time to buy will be near. :) ... the survivor bias inherent in the popular stock market indices means that passively holding a portfolio from peak to peak will not even make investors whole in nominal terms (never mind inflation adjusted terms - that can take an eternity and a half). a chart book showing an index does definitely not tell the whole story. not to mention that peak-to-peak can be a very long time indeed (25 years after the 1929 top, about 100 years after the 1720 top, a not yet determined time span in the case of ther Nikkei's 1989 top, but it's a good bet it will take longer than it took after '29 for the DJIA). Theodore Wong - 'what the missing out argument misses' (or why the passive buy and hold strategy promoted by SIegel et al. is wrong - or at least, has been for the past 137 years....) advisorperspectives.com