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OK, now at least I think I understand the essence of the advice

IF (Value Of S&P 500 index this year) >= (Value of S&P 500 index last year)
AND (I still have one or more years living expenses in CDs)

THEN
  withdraw living expenses from mature CDs
  withdraw my annual safe withdrawal rate from investments
  deposit it in new CDs
ELSE IF (Market is down, but I still have CDs left)
  withdraw living expenses from mature CDs
  leave the money in the market, waiting for a turn around.
ELSE
  withdraw living expenses from investments
END

I still don't agree -- it conflicts with another well known rule of thumb "avoid attempting to time the market."
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