Morningstar's John Rekenthaler writes of a Great National Funk, not a James Brown-inspired funk, but the kind of funk that comes from market extremes changing investor behavior.

After the 2008 crash, a certain idea became widespread, namely that buy-and-hold investing was dead, Rekenthaler writes. The idea was driven by anxiety and fear, boosted by personal finance writers, money managers and investment strategists Rekenthaler says.

Though Pimco's [profile] Bill Gross' prediction of a new normal, that the U.S. economy would simply move along at slow pace rather than rev up its engine post-recession, his other prediction that stocks would would have a lower rate of return in the future, did not pan out, Rekenthaler writes.

Surprise, surprise, people have now realized that making stock decisions based on a bond economist's fortune telling was not a wise decision, Rekenthaler says, as it left investors who ditched stocks after 2008 lost near the amount of their original investment in opportunity cost.

To read more, click here.  

Edited by: Casey Quinlan


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