Quote:
Originally Posted by verticaldoug
The mistake is to equate the price of the stock market as a sign of success of the society. It's just a sign of success of getting high stock prices.
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i think the part that i left unsaid (and what many on bogleheads would not wish to consider) is that much of the investing philosophy on that site is due to the underlying assumption that over the long term, investment in the stock market would bear fruits. as @matttuck rightly pointed out, viewing the market as a widget that generates returns is a faulty understanding of the market, yet we have to look at it that way, because we in this country are forced into dipping our toes into the market.
The underlying reason is due to the phasing out of pensions, pensions (for those fortunate enough to have them) usually can't cover all expenses during retirement. Alas, we plow our savings into the S&P, hoping that it would deliver returns. if something similar were to happen to the S&P 500, we'd all be royally screwed.
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also, i think S&P will hit official bear territory this week. fun times ahead...
opps, hadn't realized that the high was 2940 (as opposed to 2930 as i thought). Appears as if we've already got to bear territory. At least the market closes early...