Pixy: Thank you for bringing greater clarity to what I, quite frankly, view as a fairly clear issue to begin with.In part you said....Recognizing the definition of a bear market is in the eyes of the beholder and whose statistics you are using, I still am at a loss as to your rationale for the length of the 1973-74 drop. According to Ibbotson, a widely respected and often quoted authority for such data, in December 1972 the S&P 500 total return index (capital appreciation plus reinvested dividends) stood at 84.96. In January 1973 the downward plunge began not to bottom out until September 1974 when it hit 48.74, a cumulative loss of some 42.6% from its high. The high wasn't regained until June 1976, and it stayed there only until February 1977 when it again plunged below the 12/72 level. It remained below that level until April 1978 when a sustained market recovery set in. Given that, I have a hard time buying into your premise that the longest bear market from peak to recovery is less than 2.5 years.If I understand you, if I had an investment portfolio worth $100,000 in 12/72, it would have been worth $57,400 in 9/74. I would not have been back to the original $100,000 until 6/76 - 3.5 years later. My portfolio value would have then gone down again and not recovered back to the ORIGINAL $100,000 value until 4/78. So, my portfolio, which was invested very Foolishly in the S&P index, would have had a zero return - in the aggregate - for approx. 5 years and 5 months - and during MOST of that time, I was DOWN in value.I guess one can say that in the time frame highlighted, there were actually TWO BULL MARKETS - from 9/74 to 6/76 then again leading up to 4/78. But as a LTBH investor, I believe that perspective is off the mark and, actually, smells a bit like market timing ( a VERY un-Foolish concept). Pixy goes on to say...Bear in mind also that Fools don't talk about putting three to five years' income into long-term fixed income vehicles for the precise reasons you outlined. We stress far less volatile vehicles like MMFs, CDs, and short-term to intermediate-term bonds instead. The volatility of the underlying principal value of a bond as you move further out on the yield curve (longer time horizon) increases substantially - maybe even exponentially! I do not believe anyone was advocating investing funds earmarked for covering living expenses over "x" years in long term instruments - now, THAT would be "irrational."As a LTBH investor, we are building an investment portfolio that we plan to live off of for many years (hopefully!). Over time, we WILL experience down markets (let alone 'bear markets') - and, quite frankly, I have no desire to liquidiate equity assets (if I don't have to) into a down market. Putting $'s earmarked for near term living expenses into short term fixed income instruments protects me from doing that and still provides me with a nominal return.In conclusion, Me thinks some posters to this board have gotten a bit tipsy in these "heady" times the equity markets have given us these last few years. I'll continue to take the long term perspective thank you very much.Ken
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