Many investors have invested diligently in General Motors (GM) or Ford (F) over the years (especially those that worked for either company.)

And now, sadlyl, you have nothing to show for it.

Why didn’t buy and hold work for these companies? Does that mean buy and hold never works?

A lot of buy and hold skeptics look at GM and Ford and say, “see- this is why you shouldn’t buy and hold.”

But buy and hold DOES work- if you own companies that are growing their business. How long ago was it when either of these car companies actually made money off of building cars?

General Motors was profitable earlier in this decade because it owned a big lending unit, GMAC, that did, among other things, home loans. But GM hasn’t made money off of its actual auto business in years.

The company hasn’t made money at all since 2005. And they won’t in 2008 (given …

I was in Holland, Michigan over the weekend and went to the one shopping mall in town, Westshore Mall. If you know Holland, you know it. It has the JCPenney.

Otherwise, the interior stores were rather sparse. (But the mall was recently bought and an extensive rehab is planned which could explain the scarcity of stores.)

But one booth in an empty store caught my eye.

Two men were sitting at folding tables and buying gold.

And two women were selling.

They had scales and were giving out cash for necklaces, rings, earrings etc. Anything with gold in it.

I didn’t ask how much they were paying (I wish I had.) Gold is currently selling at $931 an ounce, but, of course, these dealers would have been buying for much, much less.

But still. If you can get a couple of hundred dollars for selling some gold necklaces you hardly wear, why not?

That’s the difference …

The Shanghai Index is in a full-fledged crash. It’s down 46.5% this year.

Have you heard about it?

I thought not.

Even though many people are invested in international stocks- apparently not enough care about Chinese stocks.

This isn’t just a “bear” market - which normally is a 20% fall. This is a red alert crash.

Surprisingly, Chinese investors aren’t panicking. That’s mainly because the Chinese government has, in the past, stepped in to prop up the markets and so Chinese investors are conditioned to expect it this time. But with the markets down nearly 50%, what if the government doesn’t step in?

From the WSJ:

Beijing already has taken several steps this year to try to bolster market sentiment. In an effort to calm fears that a flood of new shares would dilute already weak prices further, it announced on April 20 stricter limits on the sale of a large category of stock that was …

For years, financial advisor Suze Orman has preached that people should invest in index funds because most mutual fund managers don’t beat the market. (She’s correct.)

In 2005 she said:

“If you truly want a one-fund solution, I would recommend investing in a “total” stock market index or an “extended” market index. These funds own an even wider array of stocks than the S&P 500, which is focused on large established companies. The broader total and extended market indexes also hold mid-size and small stocks; it’s a great way to get exposure to all strata of the U.S. market.”

But recently, Suze Orman has changed her mind about what you should be investing in.

Now, she says, index funds are “out.”

You should be actively managing your own money. From June’s Money Magazine:

Q. You used to be a big fan of index funds. Now you’re not.

A. I know, I know. I’m switching for …