The stock market is so immense and complicated that nobody knows why it goes up and down, yet the television pundits will daily tell you that it is because of Spain or the fiscal cliff or Citigroup's earning report or some other thing that "makes sense." The truth is they really don't know, but they create a convincing claim to the contrary.

Don't get suckered by fools, salesmen or liars. The majority of investors are merely speculators. There is one very important fact that applies to the value of the stock market. As shown by the graph below, the general level of Dow Jones stock prices goes up over time. This graph goes back to July of 1885 and continues to 2112. 127 sum years of record. Buy and hold is a good strategy as long as you are willing to wait. It doesn't mean the company you invest in won't go bankrupt or that your rate of return will always be high, but if you pick a good, high quality company like Chevron, Walmart, McDonald's, IBM, etc., and are willing to hold it for a long time, you are virtually assured a profit.