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What kind of bull market begins when the S&P 400 Industrials are more than 5 times book value? What kind of bull market begins when the S&P 500 yields under 2%?

There are 163 stocks in the Russell 2000 with dividend yields north of 4%. Another 364 have P/B ratios of less than 1. And there's lots of overlap between the 2 lists. Obviously some of those dividends aren't going to be sustainable, and much of the book value is intangible fluff. But that's why we put ourselves to sleep 100 nights in a row plowing throught Graham and Dodd. A serious investor can find underpriced securities, but nobody ever said it would be easy. Anything that jumps in the boat isn't worth bringing home to eat. You've got to work for your supper.

Look at Buffett's performance from 1957 to 1998. He killed the market, regardless of whether it was a bull or a bear market. He didn't kill it by sitting around waiting for the entire S&P to trade at 1 times book, he killed it by recognizing value-based opportunities and taking advantage of them.

The last time we had a bull market, my annual performance lagged the S&P by 28%. Since we've been in bear territory, I've killed the S&P. I really don't care if we ever have another bull market, but I'm getting sick of message boards that are full of nothing but doom and gloom.

Even buy and forget is preferable to sit on the sidelines and whine.

Somewhat snarkily,

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