The argument that Russell makes should be applied to Passive Investing.
What reason is there to believe that it is not necessary to adjust one's stock allocation in response to big price changes (when the risk of stocks obviously becomes much greater)?
The only justification for this belief that has ever been put forward is that there are academic studies showing that short-term timing doesn't work. But the same data that shows that short-term timing has never worked also shows that long-term timing has always worked. Why is the data good for making the one point and not the other?
If you reject the data altogether, there is no reason to believe in Passive Investing.
If you put stock in what the data says, you are logically required to reject Passive Investing because the data shows that long-term timing has always worked.
There is no rational case for the idea that it is not necessary to change your stock allocation when stock prices go to insanely dangerous levels.
There are no rational arguments for Passive Investing. Marketing slogans appeal to the emotions, not to human reason.
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