I completely disagree - these are no longer markets, but theater to some degree, with indirect (and I'll debate that there is a PPT) intervention from TPTB, who view market rises as adding to a "wealth effect" (which is rendered ineffective to some degree by the fact that the purchasing power of the currency continues to be eroded.) Given all manner of recent operations (POMO, etc) acting as if the government is not actively trying to intervene in markets both indirectly (and I'll say directly) is something I'll completely disagree with. There are some people who continue to believe, it seems, that this is the same market as a couple of decades ago - whatever allows one to sleep at night.
"Buy and Hold" investing is really - in my opinion - only for someone truly comfortable with holding something for 5-10 years - literally putting something away that you believe has that strong of a fundamental case (and this is primarily for specific stocks). Otherwise, how anyone can discuss buy and hold in a market where 70% of the market is computer-generated trading that takes place over a time-frame that is frequently less than a minute, I don't know.
I'm not selling at the moment because I do continue to believe that we face the possibility of significant inflation over the next decade and am in names that I believe could do well in that environment. However,we have serious problems and I'll be the one to say that we might not fix them or we might not fix them for years. I'll also note that we're at the point where I think any more significant policy errors could cause massive, large-scale problems.
Any which way, we've spent trillions in various stimulus programs and we're where? What did we get for that money - and now we're talking QE3? I'm baffled by any discussion about how we can recover smartly when we just had a remarkably embarrassing couple of weeks where it became quite apparent that we have a government who can't begin to work together until the 11th hour and even then we got an agreement that no one was happy with (but we're going to go further into debt.) I think to some degree the selloff this week is due to a market that is starting to wake up to the fact that the current government is incapable of handling the problems that we face and really even working together in any positive fashion.
This sort of soothsaying and excuses that we'll get out of this because we always do lets those who have to guide and provide leadership for this economy completely off the hook. We don't have to get out of this, and all of this "Europe is worse than we are" is more BS that directs attention away from our own shortcomings - but whatever makes us feel better over the short-term, right? Spending smartly would have been spending a fortune to upgrade this country's crumbling infrastructure (maybe PPP's, like they have overseas? - Public/Private Partnerships) rather than dumping into banks that should have gone under (and do not appear in great shape today even after all the money that has been thrown at the problem.)
"Failing infrastructure will cost the United States billions of dollars in lost productivity, income and trade in coming decades, according to a civil engineering report released on Wednesday that said the impact on gross domestic product could reach $2.7 trillion." http://www.reuters.com/article/2011/07/27/usa-economy-infrastructure-idUSN1E76Q0J120110727
This country was incredibly foolish for not spending on infrastructure in 2008.
"Foreigners have already recognized our relative stability and are investing in government bonds."
Those who manage to believe that the fundamentals of owning US government bonds are in any way positive are welcome to invest.
This is not against MJG, but just a general upset about the soothsaying ("Oh, it'll be okay. Why? Because it always is and always has been.") and pointing fingers and fascinated by anyone who believes that the government in its current, broken form, can provide solid and sustained leadership to solve any of the problems that we face. Additionally, the "we'll get out of this because we always have" and the pointing fingers that "such and such country is worse" makes us feel a little better in the short-term, but fixes absolutely nothing.