Bull Market R.I.P.? Two years after its all-time high, Dow is still off 30 percent

A moment of silence, please, for our late, lamented bull market. It drew its last breath exactly two years ago Friday, so let us pause and reflect upon all that we have lost since then, be it jobs, homes, orthodontia, college educations or retirement.

Somehow this two-year anniversary makes us feel more angry than elegiac. The Dow Jones Industrial Average ($INDU) notched its all-time closing high of 14,165 on Oct. 9, 2007. The broader S&P 500 ($INX) recorded its all-time closing high on that date, too, topping out at 1,565.
True, the market is up 58 percent from its (fingers crossed) bear-market March bottom, but it's still off a very painful 30 percent from that two-year-old record. Even worse for the vast majority of American shareholders whose only skin in the game comes in the form of ponderous 401(k)s, IRAs and 529 plans, is that the "stocks for the long run" mantra of buy-and-hold investing has been such a bust.

You can slice and dice a chart anyway you care, and buy-and-hold works if you buy at the right time. (Of course it never quite tells you when to sell, but that's a discussion for another time.) Just take a look at standard three-, five- and ten-year market performance, and it's understandable why so many folks feel, well, fleeced.

These are index levels for the S&P 500. (The Dow is the sexier headline index, but it's only 30 stocks.) And the figures don't include reinvested dividends, taxes or inflation. Regardless, ugh:

Over the last three years? The market has lost 20 percent.

Five years? Down 5 percent.

Ten years? Minus 20 percent.

(And let's not even get into the Nasdaq Composite ($COMPX), which is still down nearly 60 percent from its own tech-bubble high notched back in March 2000. Thanks, Pets.com.)

Not that we advocate a day-trading, market-timing, portfolio-churning, return-chasing approach to equities. Such craziness is akin to playing roulette in a casino -- with fees and commissions tacked on to every spin of the wheel.

But as for buy-and-hold? Well, it may or may not be bogus -- but it sure has a lot of explaining to do.

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