Similar under exposure exists amongst UK pension managers (source: UBS Asset Management data). Equities accounted for 75% of UK pension-fund assets in 1999 (UBS data). Insurers have less than 10% of assets in stocks.

This is, to my way of thinking, a long term bullish factor. Edwards is in agreement with the long term view, but he has shorter term concerns that “stocks are in a bear market — “The Ice Age” — that may bring the lowest prices in a generation.”

The bullish counter-argument is that occurred back in March 2009. The counter-counter-argument is that gains are mostly Fed-driven, and history shows those tend to be ephemeral. The counter-counter-counter-argument is that as time elapse, the economy heals, individuals deleverage, and we get that much closer to the end of the secular bear that began in March 2000.

Again, when stocks are low you buy them, and sell them as they go higher. Passive buy and hold only works in a secular bull market as existed in 1982-2000

With all the ETF’s currently available you can always find a ‘bull’ market somewhere, there is no need to limit yourself to only one market as it were.

Bonds today are dependent upon Central Bank stimulus operations. Should monetary policy change for any reason, bonds will enter a bear market that will last for a long, long time. To an extent, strategy can offset a bad bond bear market, viz. a bond ladder.