Buy-and-Hold Brainwashing
N E W Y O R K, Nov. 24 -- — Buy and hold. Yep, that’s the ticket. You buy Portal Software and you forget about it. You buy Harmonic Lightwaves and you forget about it. You buy Webvan and you forget about it. Buying and holding is always right. Even when it is wrong it is right. Even when you lose everything, it is right. It is right because there is no such thing as wrong!
There. That’s an actual rant, one that I delivered to our trading desk right before I left the office on Wednesday, after I heard the umpteenth investment adviser/mutual fund manager talking about buying and holding on television.
This buy-and-hold stuff is the most amazing justification for losing money I have ever heard. It is simply extraordinary how it trumps any sort of judgment about profits going up in smoke. People offer it as the palliative to all of their giant losses. It makes me sick to my stomach. When this era is over, the buy-and-hold brainwashing will take its place (along with portfolio insurance, from the 1987 period) as the silliest reason yet to lose hundreds of millions of dollars in the market.
Use Your BrainDo I agree with the concept of buy and hold? Indeed I do, if nothing is wrong with the merchandise. But if the merchandise turns out to be faulty, do you buy and hold it? No way. During this era, a lot of faulty merchandise got bought with no intention to sell. And it is killing
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