Rick Ferri says the following in an article at IndexUniverse about passive investing;
Market timing strategies are a zero-sum game in the marketplace. The ﬁnancial markets don’t earn any more or any less return just because one person is buying and another is selling. If one investor buys in at the right time it means another investor must have sold at the wrong time.
Who loses if you buy a stock at $10, you sell it at $20 and the person who bought it from you takes it to $30? What if you sell half your position at $20 and it goes to $30, who loses?
Yesterday's post about gold being in a mania was re-run at Seeking Alpha and it drew a couple of comments laying out in one form or another the case for why gold is where it is and why it is likely to keep going up. Actually the way I read the comments I think both people were saying gold cannot go down in price because of the fundamentals behind it--fundamentals being how messed up the US is right now.
Anything can go down in price at any time for no reason at all. Some sort of price correction would not necessarily mean the fundamental story had changed but as something that is traded actively in markets it can drop for no reason at all.
People used to think that real estate could not go down in price. The internet stock niche got decimated yet the actual internet exceeded expectations as far as how much it has changed our lives.
The title is a bit of a joke, my wife says my entire life is like the weekend.