I had an interesting opportunity the other day to interview John Bogle on the radio show. Mr. Bogle is the founder of the Vanguard Mutual Fund company and considered one of the legends of Wall Street.  He was discussing his new book, Don’t Count It.  

I can’t say that I completely agreed with everything that Mr. Bogle wrote about in his book.  He and I do differ on buying and holding investments and how active an investor should be when it comes to investing.  Regardless, this is a must read book from a guy with a lot of wisdom.

He did make an interesting comment and it was something that he wrote about in his book.  He talked about how no one is a long-term investor anymore.   People don’t hold investments.  It has turned into this environment of buying, selling, and speculation.  

I think that he underscores a real transition that has taken place in the market place which further underscores the need to think differently.  I found Mr. Bogle, who has been doing this for decades, to be longing for the days where everyone did buy and hold and may be fighting change a bit.  

It illustrates that there are two different mindsets when it comes to investing  One mindset says that you buy and hold, don’t touch your investments, and stay invested no matter what.  The notion is that you buy and hold good companies because they are good companies.  However, even the stocks of good companies can lose 50 to 60% at any given time.  Does it make sense to hold on for that ride down for the sake of investing in a good company?  

The other mindset says that you monitor the market and you have a sell strategy in place when risk levels get high.  That is completely different from most of the mutual fund community and especially what the financial advisor community preaches as the only way to invest.  

I am not making the mistake of saying that “this time it is different.”  I think that it goes way beyond “this time.”  I think that we have seen a fundamental shift in the way investments are handled on Wall Street.  However, the fundamental shift has occurred as a means of survival in a world fluid with change.

This means that every investor has a choice to make.  You either adapt to the change or continue doing something that has a low probability of actually getting you to your financial goals.