That's a distorted view that you get from imagining if you had invested at the low of the last recession. Look at Japan's index, where it still hasn't caught up to the 1989 peak.

By Japanese index, I assume you mean the Nikkei 225. And don't you mean 1989 crash's low? The 21k levels have now become the new highs.

Calling a low is almost as impossible as calling a high. Though there are methodologies like Graham's which provide decent net-nets to invest in. A study on the Graham stocks since 1990: http://www.netnethunter.com/benjamin-graham-is-this-where-mo...

So, it really depends on the methods used to find the bargain which matters.

Yes, for investing, keep extra cash on hand for when the stock markets plummet. Then you can scoop up ETFs etc. for hugely discounted price.

The economy will recover, and you'll have bought a lot of value for a good discount.