I suspect it's a combination of poor savings habit and fear.
For many people they can't stomach the thought of a loss, even if it is a temporary non-cash event for them. Many others feel like they need to keep staring at it and so aren't able to relax with the money sitting there. It's strange, but that's the way things are. Many of these people are the same ones that think buying a home is always a good investment, and for them, it may well be because it sometimes is the only way people actually save money (by needing to pay a mortgage).
My dad kept cautioning me several times over the past few years when market conditions looked dire, but I just ignored him and held on. My dad used to be heavily involved in the market, but as a day-trading and lost a ton, so I generally ignore his advice. His money sits in the bank now, I have offered to set him up a Vanguard account and tell him which funds to put his money in but he's ignored this and I haven't pushed. My parents expenses are low* and he has enough to live off easily.
*Exception is when it comes to their grandkids (my nieces and nephew), of course!