Re: SSO
Not necessarily true. If the past is any indication of the future (I fully admit that it may not be), people have been over compensated for the risk of owning stocks. Put another way the risk premium paid to stock owners is too high for the inherent risk of owning stocks for long holding periods. Again if the past is any indication of the future stocks have never been under water after a 20 year holding period if memory serves. I think it's clear that when one is over compensated for taking a risk (for stocks it's been by a very big margin) leveraging up is just fine. What do you believe the equity risk premium should be and just as importantly what do you think it actually will be? I assume you have some idea since you've recommended that people by index funds.
BTW SSO since it's inception has increased by 29.7% while during the same period SPY has increased by 15.8%. SSO has not increased proportionally with the risk taken but if the risk taken is over compensated by a great deal than taking twice the risk is fine IMO.
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