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Strategy Lab: Why invest in this market anyway?

January 21, 2009 1:34 am

stratlabOver the past few months, there have been many voices shouting out about the need for investors to get into the market, as pricing is now considered “cheap.” Warren Buffett spoke up about it in October — Berkshire Hathaway  is down 10% more in 2009 — as did a few other astute pundits. I would not want to take anything away from them, as they are much wiser and wealthier than I. But how about a dose of reality and a touch less self-serving blather?

Just Tuesday morning, I was watching Vanguard’s John Bogle discuss the need for a transaction tax on investments. Now doesn’t that seem to be a commenter who is hoping to move more people into a buy-and-hold (aka, till-death-do-us-part) strategy? That’s the same strategy that has pummeled the average investor over the past 12 months. Why would Bogle even consider something so radical?

Oh, that’s right, he runs a company that earns it keep by providing low-cost index funds with low turnover. Of course, low turnover would provide protection against a trading tax and hurt those pesky advisors who attempt to get out of the way of a speeding truck, also known as a market correction.

Where do we go from here?

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Written by Andrew Horowitz · Category(s) Strategy Lab    |  Tags:   

6 Responses to “Strategy Lab: Why invest in this market anyway?”

  1. Chris on January 21st, 2009 8:43 pm

    I like you Andrew, but the anger and arrogance you have been showing lately really needs to stop. I like your show, and it makes me think in different ways than before I listened. But because you did well over an 8 month period should not overshadow what investors like Buffett have done over a lifetime. I want you to keep doing a great job on your podcasts and I will keep listening, and I know there has been a lot to be angry at over the past year, but you have to stop calling everyone idiots for not investing like you do. I'll be honest; the louder you get, the more skeptical I am of you. So keep up the good work, but just relax with the anger, and it will make for a better show.

  2. Andrew Horowitz on January 22nd, 2009 5:03 am

    Re: Chris commented on Strategy Lab: Why invest in this market anyway? –

    Please do not confuse arrogance with disgust for the system. If you read carefully, I am humbled by the masters, but question their recent actions. Should I follow blindly?

    Can you kindly point out what areas offend you or is it mostly that I picked on Warren and John ( Suze too)?

    Andrew

  3. Andrew Horowitz on January 22nd, 2009 5:06 am

    Re: Jonathan commented on Strategy Lab: Why invest in this market anyway? –

    Here Here ( Hear Hear)

    Andrew

  4. Chris on January 22nd, 2009 5:59 pm

    It is probably the Warren Buffett stuff that set me off. This is probably the 3rd or 4th time I have heard you disparage him, and I do notice you always throw in the discalimer "not to discredit them" or something similar. But I truly felt some of your comments were an attack on Buffett's ethics and morality. While I do encourage questioning what they are saying and their results (Buffett is obviously not infallible), I thought it seemed ridiculous with the way you questioned them. Buffetts NY Times piece was well written and repeatedly claimed not knowing whether the market will go up or down from here, but that it is likely to outperform those clinging to cash over the next decade. While you may not agree with his philosophy, or even if this is good advice, you seemed to have repeatedly cut himself as looking out for Warren Buffett's own self interests. I think he has shown himself to be a person of high integrity and outright honesty (maybe I am wrong i don't know him personally), but you seemed quick to throw him under the bus based off of 2-3 months instead of the time frame he clearly laid out.

  5. Chris on January 22nd, 2009 6:00 pm

    Sorry I had to split my message into 2.

    Anyways I really dig the show, and have been listening since probably podcast #30 or so, and just wanted to give you some feedback on something that was making me cringe. I think bloggers and individuals like you are doing the work journalists don't do anymore. The oil speculation information you provided was probably the best reporting I heard all year in any media source. I think it is great to be skeptical, but also to be fair in your critiques.

  6. multibagger on December 7th, 2010 4:48 am

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