yeah, he definitely said it in one up on wall street. he's a yutz, and he's full of sh!t. this is the same guy who cried "fundamentals" when he had erlanger and a boatload of other TA's working for him while he ran magellan... (btw, read schwager's stock mkt wizards book and you'll see what a piece of crap magellan has become since lynch left) if it smells like bullsh!t and looks like bullsh!t, it probably is bullsh!t...
It's b/c if someone has no clue what will happen, the odds are better if you go long. In other words, unless you know a specific reason why a stock should decline, the expectation is it will go up gradually (even assuming randomness, most models of random walk include a positive drift for this reason). I stated this elsewhere on ET, stock price is an increasing function of time. Edit: PS That and the asymmetric payoff structure of long vs. short positions. Cheers.
maybe, if that stock is part of an index. i believe that most stocks tend to go down over time. the fact that they rebalance indexes is testament to that fact...
I know so many stock market crashes and I know many victims of them. How many of us know stock market boom? Only stocks of companys that was taken over might gap up 20 or 30%. The indices never able to do so.
Talk about represetatitiveness heuristics, ha? I stand by what I said. Unless a company has 100% dividend payout ratio, the price will be an increasing function of time, there are other explanations too, but this one is the simplest. This of course is a long term perspective. Since most investors are long term, being net short for them is not wise, to put it mildly.