Bill Miller: If You Can’t Buy When Prices Are Falling You Can’t Buy At All

Johnny HopkinsBill MillerLeave a Comment

In his recent interview on the Richer, Wiser, Happier Podcast, Bill Miller explains why if you can’t buy when prices are falling you can’t buy at all. Here’s an excerpt from the interview:

Miller: The other thing that I’ve said is that nobody can predict these things, the future, no one has privileged access to the future. Could this be the end of days? Maybe it is. I don’t know. Keynes made a point back in the 1937 when the market went down 50%.

He made the point, “Well, look, if you can’t buy into the market when prices are falling, and falling a lot, then you can’t buy at all. Because if it’s the end of the world, well, it doesn’t matter.” Lower prices are always more attractive than higher prices. The most attractive prices are at, or just close to the lows.

I don’t know if we’re there or not in this, but I do know that with six new highs today and 2000 new lows, there’s a fair amount of pessimism in the market.

Every correction that we’ve had in the past regime, so 2011, 2014, 2015, I think it was 2018, 2020. Those particular lows were reached when we had about 40% of the S&P 500 making 52-week lows. Yesterday, I think we had 25% of the S&P 500 on the new low list, but another 25%, actually more than that, are within about a percent or two of making new lows, which would tell me that any selloff from here, we’re down 1.3% today.

If we get a bad day tomorrow, a bad day Monday, we’ll be, in my opinion, based on the previous lows, we’ll probably be there close to it, at least for an intermediate term rally.

You can listen to the entire discussion here:

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