A March 6th Bloomberg story, “Bonds Beat Stocks in ‘Earth-Shattering’ Reversal“, danced on the freshly dug grave of my prior post that rhetorically questioned the Death of Equities. In fact, as the chart illustrates, the patient passed away back in October of 2007 which was the peak for global stocks.So, the strategy of buying and holding stock for the long term simply has not delivered the goods. This must present a stupefying challenge to the principles and practices of investment advisors. If you cannot justify the risk premium in owning equities you must throw out all of the traditional asset allocation models, modern portfolio theory, and yes, you can toss out those old Ibbotson charts.
Album: The Best of Gary U.S. Bonds, Gary U.S. Bonds, 1990
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