DOW up over 900 points today -- CRAZY

UsedToBeKnowItAll wrote:

Umm, actually it's pretty easy to time the market. There are a multitude of indicators, and if you're well-diversified, it's even easier. People (and stocks) are pretty predictable in large numbers.

Dude, you're flat out wrong about it being easy to time the market. Not sure what planet you're on. Every expert and their brother will tell you that it can't be done. You can try. There are indicators, but nothing is exact, and it's all off enough that you can't make any traction trying to time ups and downs.

TED spread is probably a more meaningful measure.

ok are the lawmakers the only ones who are getting rich right now?

Flagpole wrote:

UsedToBeKnowItAll wrote:

Umm, actually it's pretty easy to time the market. There are a multitude of indicators, and if you're well-diversified, it's even easier. People (and stocks) are pretty predictable in large numbers.

Dude, you're flat out wrong about it being easy to time the market. Not sure what planet you're on. Every expert and their brother will tell you that it can't be done. You can try. There are indicators, but nothing is exact, and it's all off enough that you can't make any traction trying to time ups and downs.

I talk to George Russell (chairman emeritus Russell Investment Group, Russell 2000) once in awhile. George says it's impossible to time the market consistently. If you really can do it UsedToBe, he wants to talk to you about a job.

Moving Eqpt wrote:

TED spread is probably a more meaningful measure.

But I think that the larger underlying issue is the banks and their trust of each other. The funds rate comparing funds rate and LIBOR is a good way of watching this. The T bill rate vs LIBOR is a good way of watching market response for the interest rate. But the currently we have a banking issue, which is what is causing these radical changes in the market which can be seen clearer I believe, in the Fed Funds vs LIBOR.

Squid wrote:

Flagpole wrote:

Dude, you're flat out wrong about it being easy to time the market. Not sure what planet you're on. Every expert and their brother will tell you that it can't be done. You can try. There are indicators, but nothing is exact, and it's all off enough that you can't make any traction trying to time ups and downs.

I talk to George Russell (chairman emeritus Russell Investment Group, Russell 2000) once in awhile. George says it's impossible to time the market consistently. If you really can do it UsedToBe, he wants to talk to you about a job.

If you buy and sell stocks completely randomly, you will have the same average returns as a well-diversified portfolio in the long run. So, all you have to do is be right 51% of the time and you beat Flagpole's sit-tight strategy.

When the market was at 14,000 last October, that was like when you're sitting at the blackjack table, counting cards, and the deck becomes heavily stacked in one direction. If you just keep betting the same amount, you're a fool. I don't try to time the market very often. But when all the indicators are saying the same thing, then it's an easy decision.

I agree that it's impossible to time the market consistently. Fortunately, you don't have to do that.

It's working its way back down. It won't be as steep a drop, but I'm pretty sure we haven't hit bottom yet.

wheeeeeee down the slide again!!!

like moving to cash isnt what the very best hedge fund mgrs havent been doing since Nov 07

http://www.nakedcapitalism.com/2008/04/stock-hedge-funds-hold-record-cash.html

remember guys like John Paulson will show 10-20% return on equity this year while you buy and hold types will be so sick of the downmarket by Christmas you wont even open your statement anymore.

"going to cash" is what the pros do when they don't know what the market is doing and cant make trades work.

This backing and filling isn't abnormal after the "furious" 25% move off the bottom that we were looking for last week.

I wouldn't call it a "healthy" close though.

Like i've said...cash is king. No sense in diving in while we are seemingly directionless right now...remember the pros know that they need to look at future company profits over the next 6-8 quarters and they know that profit estimates are still too high....

jeb

If you drop a ball off a ledge

It will bounce when it hits bottom

But make no mistake

It will come to rest on the floor

where is flagpole today? Dow DOWN over 700 points today. CRAZY!!

Flagpole, the market is down nearly 6000 points in a year, we are in a recession (ready to make a call on that yet?), and many numbers on the economy are looking bleak. And yet here you are again, Mr Market Cheerleader (you'd fit in great on CNBC or Fox News where the business/economic talk is simply 99% economic cheerleading, always trying to put a happy spin on every economic piece of info. Whatever happened to the "greatest story never told", the great economy under Bush? Well, it collapsed, THAT's what happened to that story).

So what exactly is your philosophy, oh wise Mr Flagpole?? Invest in diversified mutual funds and...... sit tight forever. That's it. That's ALL you have to offer. That's pre-school investing advice. Anyone with a single brain cell knows one should diversify. Oh thanks so much for that. And if, a year or two ago, when you suddenly decided to become Mr LetsRun Economic Genius by posting every 5 minutes about how amazing the stock market was, and how great you'd done there, and someone had come on here and taken your advice (who had not been in the market before), where would that person be now?? Shit out of luck, that's where.

Lots of people saw this housing bubble collapsing and hurting the whole market. If you had gotten out of a lot of your MF's and into safer investments with guaranteed (albeit small) returns right as this mess was starting to blow up, you could have saved yourself a ton of losses. If it didn't turn out as bad as it has, you could have jumped back in once things were looking steadier. No, I am not saying jump in and out of stocks willy-nilly (pun intended), but plenty of people saw a collapse in the making a few years ago. If one listened to those people (and got into safer investments are the signs were looking bleak) instead of Market Cheerleaders like yourself, they'd be doing a lot better right now. But just sit tight Flag, and don't make any moves.....ever. You will not be making up these losses of yours for another decade. You are going to be working until you are 70. You won't be taking a vacation for awhile. Nice job investment genius.

This Flagpole Willy a little over a year ago:

http://www.letsrun.com/forum/flat_read.php?board=1&thread=2087036&id=2087372

"If you read Bob Brinker's Market Timer, you'll know that for many reasons, a correction of the DOW's 14,000 limit in July was the furthest it was supposed to drop. That correction level (10%) was hit in mid-day trading last week. The DOW has come back about 400 points since then, with the S&P 500 and NASDAQ following suit for the most part. All of this on what many people view to be a bad last couple months. My rolling one-year return, even including the last two months is over 16%. I'll take it! That kind of return makes moderate investors wealthy.

Calls and short sales of present day are one of the reasons why it's VERY difficult to have a big crash like in 1987 or 1929. People protect their money with such things, and when there's a big sell off, a lot of people then start buying. Never a sure thing to invest in the stock market, but it's today more of a sure thing than ever before in our nation's history. "

God Bless Flagpole. The expert (on so many things) is wrong once again. Horribly, horribly wrong.

1) I've not been a cheerleader for the market. Even this thread, started with the 900+ UP day on Monday, I've been very cautious. It IS a buyers market though -- at least it seems so, and while no one is EVER perfect with predicting general swings, everyone and their brother is saying to stay in right now and even buy more if you can. I agree with that.

2) If I would have gotten out...if pigs had wings brother! If I could have predicted every up and down since 1989 when I started investing, I would be a multi-millionaire RIGHT now instead of having to wait another 17 years for that. Can't use hindsight to wonder what might have happened.

3) Let's say it takes 5 years for the DOW to get back to 14,000, or hell, even 10 years. Does that mean I'm just back to even then? HELL NO! First of all, hardly ANY stock I own was purchased when the DOW spiked to 14,000 last October. Anything bought before then and since has been LESS than 14,000, so when it gets back up to 14,000 I will be in fat city brother! Hell, even by the time it gets back to about 12,500 I will be as I made a TON of purchases well below 7,000 (DOW); I started when the DOW was at about 2,700.

4) Dude, you call my buy and hold advice preschool advice yet that is what the greatest investor, Warren Buffett, says to do, and it obviously is NOT what most people do or the market would not have such wild fluctuations like it has had. You might hear the advice I give frequently (because it IS the best advice) but not enough people take it. They let emotion rule their world. I don't. Besides, I don't say to sit tight forever. Sit tight on aggressively invested funds until you are within 5 years of retirement and then go more conservative.

5) You say that people saw the housing bubble years ago, well then, if they got out then, then they would have missed out on the DOW climbing up to 14,000+. Thing is, you can't know when the market will go way up or way down even with lots of evidence.

6) I'll be working until I'm 70? News to me brother. I have enough to retire on RIGHT NOW and live frugally if I really wanted to -- not ready to do that quite yet though, and I do plan to have some fund between now and retirement, so I'll keep working for now. I've invested that much and made that much since 1989. 59 1/2 is my planned retirement age; if anything I'll retire from full-time work before then rather than later. Besides, at age 62 I can take early Social Security, and that coupled with the fact I will have NO debt plus any retirement savings, I'll be more than fine even if the market NEVER recovers back to 14,000 (but it will).

7) You say I've lost so much. Well, I haven't lost anything until I sell, and even with the big drop since October 2007 I am still WAY up compared to the money I've put in -- WAY up. I could sell right now and even with a 10% penalty on most of that for selling before age 59 1/2, I'd still have a hefty profit. I haven't lost anything. I'm actually glad to see the market drop so much again. Gives me more time to buy cheap stock. I don't need the money that I have invested for my retirement at all right now, so I'll just keep it there and watch it grow (because it will). Even if it stays flat between now and 17 years from now I'll still be fine. 20% put away helps a lot even with low growth, and since I had years of serious growth in there, NO growth would even work for me (it won't be NO growth though).

8) Are we in a recession? Could be. I'm not against saying we could be. I've said for months now that I wish we'd get into one just to get it over with already. Easier to bounce back when people feel you've hit bottom.

You seem afraid for some reason. New to the market perhaps. You'd feel better about it if you had been in for a long time and had seen bad times followed by good times before. EVERY extended Bear market in history has been followed by a more than equal Bull market. It is coming brother. Takes 10 years to recover my losses? Ok. Fine by me, because last October I was sitting pretty. I'm still doing ok even after this big drop. Can't wait to see how much my stuff all takes off once we hit 14,000 and over down the road. I may be able to retire at 55!

see, you proved my point exactly, you are nothing but MARKET CHEERLEADER. You're "glad" the market dropped, and will say you are doing fantastic no matter how bad the market collapses. Basically you are saying that even if another Great Depression occurred, you'd still sing the praises of the market and how great you've done. Basically, no matter what happens, no matter how much your stocks go down, you think you've done great and can't lose. You say you haven't "lost anything" ? You've lost compared to what you might have made had you been smarter. You may never recover THOSE losses. And the market could go lower.

Whatever flagpole, you've basically proven my point that you have nothing to offer.

No need to get worked up. Buy/hold index mutual funds is an acceptable way to flatten out the risk for those of us who are either too busy with other life matters or don't otherwise have the inclination to live with the market on a day-to-day basis like you do. To do this we give up wringing hands about what we might have made had we been smarter/more attentive to the market.

You want to pick stocks and move in and out? Go for it man, you can make some serious coin that way. It takes a lot of time though. Some of us simply don't have the appetite for it and know that our pre-school investing strategy is a far sight better than CD's and T-bills.

Personally? I enjoy the work I do and hope that I can keep doing it until I am 70. Have no idea what I would do with myself retiring at 59-1/2.

Its great that you and others saw housing collapse coming years ago, but just because you know something is coming doesn't mean that you get out of the market at the right time. If you had pulled out of the market in 2006 when you had an epiphany that the housing bubble was going to burst and create a big mess that would take down the stock market, you would have gotten out of the market somewhere between Dow 11000 and 12500. Heck some people saw this crash coming in 2005 - if you pulled out then you would have gotten out somewhere between Dow 10000 and 11000. Back in the late 90s many people knew that the market (especially the Nasdaq) was going to collapse. Some very well respected analysts/traders got bearish on the market as early as late 1995 - if their clients took their advice they would have missed the run-up from Dow 5000 to 11700. Many got bearish in '97/'98 when the Dow was in the 6000-9000 range. And many people who got of the market in the late 90's got the timing of getting back into the market way wrong. There were four distinct troughs in the stock market from 2001-2002 (Jan '01, Apr '01, Sep '01 and Jul '02) where many people were certain they had found the bottom of the market, only for it to make a quick rally and then fall even further. How many people actually timed it right and got back in Oct 2002? My point is that just because you know the market is headed in a certain direction in the future doesn't mean you know WHEN its headed in that direction and that is the difficulty in timing the market. Yes some very smart people who track the market daily and have lots of experience are able to time the market properly greater than 50% of the time. Your average investor doesn't have that kind of intelligence/market sophistication/experience to get it right half of the time.