In his latest column for Canada’s Globe and Mail, Validea CEO John Reese takes a look at  what happens when investors get to cash happy.

Looking at data from Blackrock, Morningstar, and The Tax Foundation, Reese shows just how dangerous holding high amounts of cash can be over long periods of time, thanks to inflation and taxes. In fact from 1926 through 2012, cash actually lost value, returning -0.8% after taxes and inflation.

“To be clear, I’m not saying that cash is bad thing,” Reese says. “Most investors should probably have some cash on hand — Warren Buffett always has some cash available in case good opportunities pop up. And I want to stress that, depending on your age and personal situation — especially if you’ll be needing your money relatively soon — you should probably have quite a bit. But, for investors who are trying to build wealth over the long haul, fleeing to cash at times like these either because of fear or because you’re trying to outsmart the market can end up backfiring.”