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Thursday, March 14, 2013
Sadly, these very same people will likely come back in as the market hits new highs. After all, in their minds, the slot machines, everyone knows (I think) that the house/casino wins.
The stock market couldn't be more different, at least from the perspective of an investor. The stock market consists of incredible businesses comprising the global economy. A global economy that is striving to create enormous wealth. The ability to participate as company owners is viewed as an opportunity by investors.
But investors don't just go in and jump on the hottest sector. Investors study the research on diversification and how to manage fees to participate in long-term growth. Investors understand the market will go up and down and that asset allocation is important.
I've reached the point pretty much where, when I hear someone proclaim the market is a casino, I walk away thinking they are better off just keeping their money in a money market fund or CDs. In my mind, most are like the hapless miners seeking an easy way to get rich whenever there is a gold strike.