Here’s a good Motley Fool commentary by Whitney Tilson that shares how I feel about the current state of investing: Fool.com: The Joy of Cash. One interesting thing to get from this: mutual funds are not always the best place to have your money. A Vanguard index fund is good because it’s cheap, but if the stock market goes sideways for the next few years, you’ll basically get no return.
Recognizing that high stock prices, rising interest rates and other factors mean that there aren’t many good investment choices, cash is not a bad place to have a chunk of your portfolio right now. Tilson says that he’s got 35% in cash. Berkshire Hathaway has $70 billion in cash and bonds. Do you want to second guess Warren Buffett?