Of all the losses triggered by the meltdown of Bear Stearns Cos. a decade ago this week and the crisis that followed, perhaps the biggest was the public’s loss of trust in markets themselves.
No wonder so many investors have cowered on the sidelines of the bull market for the past nine years. Their faith in the ability of stock pickers to outperform has vaporized, saving for retirement often seems like a lost cause, and speculative temptations like bitcoin and other digital currencies can feel almost irresistible….
Read the rest of the column
This article was originally published on The Wall Street Journal.
Further reading
Jason Zweig, Your Money and Your Brain
Jason Zweig, The Devil’s Financial Dictionary
Benjamin Graham, The Intelligent Investor
Chicago Booth / Kellogg School Financial Trust Index
Dale T. Miller, “Disrespect and the Experience of Injustice” (Annual Review of Psychology, 2001)
Shelley E. Taylor and Jonathon D. Brown, “Illusion and Well-Being: A Social Psychological Perspective on Mental Health” (Psychological Bulletin, 1988)