in general, stocks are for suckers – they are a rigged game and the game isn’t rigged in favor of the average investor
there are times when the average investor can do OK in stocks – now isn’t one of them
unfortunately, people in this country are bombarded with really bad advice and conveniently picked ‘facts’ about stocks:
– buy and hold
– dollar cost averaging
– stocks return 7% on average over long term
this bad advice is compounded by systems that encourage people to buy stocks and hold them for the long term:
– tax savings via 401K’s and IRA’s
– employee stock purchase plans
– company matching for stock purchases
– penalties for early withdrawal from these systems
all of these factors cause the average investor to lose money in the stock market over the long haul
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and another significant factor: people are not allowed to go short in most of their 401K and IRA accounts – the average investor shouldn’t be shorting stocks but the fact that he isn’t allowed to do so is another indication that the game is rigged in the house’s favor (ie, keep the suckers long stocks regardless of what the market is doing)
