About a year ago Phil Town had a really fun argument on Maria Bartiromo's show, on the steps of the Federal Reserve Building with a mutual fund apologist from Kiplinger. The market was off a rather sudden 500 points at 14,000, and he was pitching the same old "buy & hold" snake oil while I was arguing that there was a significant sell-off in an over-priced market that was going to take your mutual fund down and your retirement with it.
He basically accused me of wild speculation. I accused him of willful ignorance in the face of clear evidence that institutions were getting out. It was like he couldn't hear me. Like I was speaking English and he was only able to understand Greek.
The fact is that we were speaking two different languages. I was speaking the language of value. He was speaking the language of efficient market theory, or EMT. In a perfect world like the one Ivy League intellectuals live in, people are stalwart and rational. In that world, I would agree with him. But we don't live in that world. Unfortunately, your fund manager thinks we do.
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