He did not say 'buy an index fund'. In an average investing environment, the argument for buying the index and not individual stocks is sound. However, buying in this market -- and to take advantage of the blood on the street -- is the individual play. Many companies will not make it, or will not make it without massive restructuring, or with much lower market share. But for a value investor, some companies with real moats and real protection have now been priced (by the overall market) into value.

He's not saying buy stocks after any crash, just after this one. The Japanese crash was a unique one because a corrupt old boy network of companies holding one another's stock and banks refusing to write off bad debt caused the fall to be artificially prolonged.

Good point. And in Japan the government responded with massive public spending and rate reductions.

haha good one.

What do you think is happening now? The banks aren't willing to write off bad debt if they can stay afloat. As a result, they aren't willing to lend to each other. None of the banks wants to make a loan to another bank that will just go under due to their holdings of bad debt.

If the banks holding bad debt were allowed to fail, this would all be sorted out much faster.