There was a big bull market in the early 1970s, led by a group of fifty large cap stocks known as… drum roll… the “Nifty Fifty.”

There is actually a Wikipedia entry for the old Nifty Fifty—click on it and you will see that while a lot of these companies are gonzo, the rest of them very much resemble today’s Dow.

Of course, I was not around to remember the Nifty Fifty—I was born in 1974, truly a child of the bear market. Stocks were down 45%. There is also a Wikipedia page for that bear market—they even call it a “crash.”

The two, of course, are related. A bubble, accompanied by an obsession or a preoccupation with a stock or group of stocks, followed by a great big dirtnap.

You look around today and wonder, is there anything like a Nifty Fifty? Well, there is FANG, but FANG is only four stocks. Besides, I don’t get the impression that any of those stocks on their own has anything like a cultish following.

And it’s not like people are bananas about tech stocks, or energy stocks, or homebuilders. People aren’t really bananas about stocks.

People are bananas about the stock market.

Indexing, which was a curiosity in the 1980s, has become a religion. You invest in an S&P 500 index fund. Why? So you are diversified. You own 500 stocks, which is the ultimate in diversification.Yes, We’re Beating up Indexing Again

Except—you are not diversified when 30 million people own the same 500 stocks as you, because what happens if everyone wants to sell their 500 stocks all at once?

It actually is a bit like the Nifty Fifty—it’s just the Nifty 500!

“Is it different this time?” you ask the veteran of two ridiculously horrible bear markets.

Well, you always have to entertain the idea that it could be. After all, indexation only makes up a small percentage of total investable assets. And it continues to grow, partly because its growth is encouraged by regulatory changes like the Fiduciary Rule. So there is a lot of momentum.