“The Words “Valuations Affect Long-Term Returns” Signify Something. We All Need To Be Talking About What Those Words Signify. They Signify That the Old Way of Thinking About Stocks, That Valuation-Based Market Timing Is Not 100 Percent Required for Every Investor, No Longer Applies.”

Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:

The stock market is crashing.  I am confused.  Why aren’t people blaming buy and hold?  Why am I and all the other buy and holders not broke?  Why isn’t everyone over here seeking out Rob Bennett’s help to save them from disaster?  Why aren’t people all begging for Rob’s new book?

Before the world was opened up to widespread discussion of the link between smoking and lung cancer, people who got lung cancer didn’t;t blame smoking. They didn’t;t know. We live in a better world today because people know about this link. And fewer people smoke!

We have the research showing that valuations affect long-term returns. Intellectually, we know how stock investing works, We have known for 43 years now. We need to give ourselves permission to talk about it. Then we won;t see these horrible Buy-and-Hold Crises anymore. Then we will be able to stabilize our stock market. And our economic system. And our political system.

The words “valuations affect long-term returns” signify something. We all need to be talking about what those words signify. They signify that the old way of thinking about stocks, that valuation-based market timing is not 100 percent required for every investor, no longer applies. That we all need to act in our own best interest and that doing so means tuning out the Buy-and-Hold garbage pushed so relentlessly by our Wall Street Con Man friends.

A CAPE value in the 30s doesn’t just happen. We all played a role in permitting that CAPE value to come into play. We all need to look inside to come to understand the Get Rich Quick/Buy-and-Hold impulse that has been making stock investing a thrill ride for as long as the stock market has been in existence (something it no longer needs to be in the post-Shiller era). It’s not all about turning a quick buck. What happens in the long run to the human lives affected matters too.

My sincere take.

Rob