Maserati wrote:
While I don't know how K5 times the market or whether it is asinine or not, I know that I time the market
Then you are an even bigger idiot than Flagpole. Congratulations!
Maserati wrote:
While I don't know how K5 times the market or whether it is asinine or not, I know that I time the market
Then you are an even bigger idiot than Flagpole. Congratulations!
Quoting myself for economy, "Even if there is a downturn greater than that, I see a relatively quick rebound as likely. Maybe not a complete rebound, but a good bounce. Money is easy to move around quickly within the market, once someone has decided to be there. Getting out, then back in, or into some other investment, is a much bigger decision that requires work and effort, and people don't want to do it."
ESPECIALLY into some other investment. It's work, and nobody likes that shit.
I agree with flagpole's observation, but I also believe that it's not necessarily a problem, depending on the length of time one spends out of the market.
Maserati wrote:
Quoting myself for economy, "Even if there is a downturn greater than that, I see a relatively quick rebound as likely. Maybe not a complete rebound, but a good bounce. Money is easy to move around quickly within the market, once someone has decided to be there. Getting out, then back in, or into some other investment, is a much bigger decision that requires work and effort, and people don't want to do it."
ESPECIALLY into some other investment. It's work, and nobody likes that shit.
I agree with flagpole's observation, but I also believe that it's not necessarily a problem, depending on the length of time one spends out of the market.
You are correct. When people leave the market, they typically do so because they fear losing money. A certain percentage of them are fearful at that point of ANY kind of investing at all, and when people don't have money automatically taken from their income and put into investments, they typically spend it. It is the rare investor who takes his 15% out of the market and immediately starts investing in real estate or some other thing; like you said, it takes EFFORT to do that.
Flagpole wrote:
You are correct. When people leave the market, they typically do so because they fear losing money. A certain percentage of them are fearful at that point of ANY kind of investing at all, and when people don't have money automatically taken from their income and put into investments, they typically spend it. It is the rare investor who takes his 15% out of the market and immediately starts investing in real estate or some other thing; like you said, it takes EFFORT to do that.
Back it up or you're a liar.
That kind of inertia is critical to maintaining the markets.
Let's face it, if you have a full-time job and any kind of a life, being in the markets in a simple way is a very economical way to invest, in terms of time commitment. It's made very easy for you, unlike investing in real estate, art, or starting and managing a business.
DOW now down 118 for the day so far.
Flagpole wrote:
You are correct. When people leave the market, they typically do so because they fear losing money. A certain percentage of them are fearful at that point of ANY kind of investing at all, and when people don't have money automatically taken from their income and put into investments, they typically spend it. It is the rare investor who takes his 15% out of the market and immediately starts investing in real estate or some other thing; like you said, it takes EFFORT to do that.
Oh, and by the way, it does not take EFFORT to put it in the bank.
Putting $ into a bank is not investing, you are losing money every day because you won't beat inflation.
The BEST high-yield savings/MMA accounts will probably get you close to 1% before inflation, and the average is less than that.
Losing money like that every day is not fun. Managing other financial instruments sold by banks, that might get you higher yields, does require some effort, and the smarter you want to do it, the more effort it requires.
My point was mainly about inertia. Getting out of a fairly sophisticated portfolio situation is not super-quick or super-easy. Just the tax filing can be a pain.
didn't you say... wrote:
Klondike55 wrote:If this goes on another week, time to bail.
I thought June 2013 was the time to bail.
I thought so too.
So I had to wait ten months before the sell-off.
It happens.
In with the Dow at 9k, out at 15k. The goal is back in well below $15k
[quote]agip wrote:
The 2.5% # is the Vanguard total world stock market index, ticker VT, before the open today. As of 9:56 AM VT, VT is down 2.7% from its all time high.
I prefer VT because it is a global measure of stocks and I and my clients have global portfolios.
Right. Not because it is the lowest decline and so supports your statements.
Klondike5 wrote:
I thought so too.
So I had to wait ten months before the sell-off.
It happens.
In with the Dow at 9k, out at 15k. The goal is back in well below $15k
That sounds like the same thing you were saying at the end of January.
Maserati wrote:
Putting $ into a bank is not investing, you are losing money every day because you won't beat inflation.
The BEST high-yield savings/MMA accounts will probably get you close to 1% before inflation, and the average is less than that.
Losing money like that every day is not fun. Managing other financial instruments sold by banks, that might get you higher yields, does require some effort, and the smarter you want to do it, the more effort it requires.
My point was mainly about inertia. Getting out of a fairly sophisticated portfolio situation is not super-quick or super-easy. Just the tax filing can be a pain.
As someone here likes to say, are you really that stupid or is it just an act?
Who gives a shit if it is "investing"? You are still saving the money as you would be otherwise. Being out of the market has zero (that's a 0.0 followed by an infinite sequence of 0's for you math-challenged folks out there) impact on whether or not you are saving 20% of your pay each month (which was the whole point).
When someone bets that the market will drop and takes money out, does it disappear? Does it simply not count as money unless it gets invested in real estate or gold? Or is putting it in a saving account or money market fund waiting for a better buying opportunity OK? And maybe that's a no EFFORT thing to do with your 20% savings each month as well.
Sheesh, sometimes I have to think some of you folks are brain damaged. You guys make K5 look like an absolute genius by comparison (which I wish you wouldn't).
At least he's consistent.
Nobody's timing is perfect. I may have gotten lucky personally, as my nervousness was building as taper was speculated.
Got out, taper was announced, markets dipped then rose again, only to have fallen back to the same level as when I got out.
Missed out on a bit, but no big deal. Timing was 2-3 weeks early. K5's timing was even worse than that, but so what, he may still be vindicated. To me, it would depend on what he has been doing with his money since he got out, and whether or not he decides to get back in, when, and at what level.
Major indexes still down 0.7-0.8% on the day...
The secret to successful investing can be summed up in one word: patience.
part of this fall in the US might be just an old fashioned but high speed sector rotation - even as the US has fallen around 3%, emerging markets and europe have not done much.
if you look at charts, emerging markets have been rocketing up.
not surprising in retrospect - the US was up 32% last year - the rest of the world just 20% or so. You'd expect some leveling out at some point.
Come on now, we both know what we're talking about, you don't have to be abusive.
Obviously it's saving. Obviously it doesn't beat inflation. It only has the power to really lose a lot if the currency tanks, or massive inflation, or if there is government confiscation, none of which are currently imminently envisioned.
Need I remind you that I have money in the bank, and am not currently in the market.
Money needs to do something. Even when it sits in a bank, it is put to use by the bank, but the banks have very little leeway in what to do with deposit accounts, which is why it doesn't do a heck of a lot, which is why you get no return. While it IS invested, that investiture is extremely limited.
It represents a resource that needs to be worked, like any resource, to add value and build wealth. The work that money in a bank can receive is limited to less than it takes to keep up with inflation.
Looking back, it seems that Flagpole said 2 things, only 1 of which I agree with, on this subject: 1) if people are out of the market they do not save; 2) if people are out of the market they no longer invest.
As a matter of record, I agree with (2) only, to the extent that I do not consider a bank account a real "investment", in that it fails to keep pace with inflation. I put it into the "wealth preservation" category.
Last post of the day: DJIA now down 1% on the day, NASDAQ down 1.5%
The day (Friday) is not yet over, but it will be Monday that will be really interesting.
OK, my apologies on my language.
I also agree with most of what you post.
This whole savings thing came up with FP offering his brilliant insight that people who pull money out of the market also stop saving from their monthly paycheck while offering ZERO evidence to back up that claim. His only (incredibly lame) attempt to justify that claim was in the form that it takes EFFORT to invest in an alternative to the stock market (real estate for example) and therefore people wouldn't do that.
I pointed out that folks could just keep right on saving that 20% and parking it in a bank (money market...) and that this takes zero EFFORT. And that is the point. There is absolutely no reason to think that someone deciding to pull out of the market and then get back in (ala K5) would also stop saving at the same time. None...Zip...Nada...
Another good beating.
Panic over the week-end.
A real sell off on Monday
Maserati wrote:
As a matter of record, I agree with (2) only, to the extent that I do not consider a bank account a real "investment", in that it fails to keep pace with inflation. I put it into the "wealth preservation" category.
Wealth preservation is a "real investment". Merrill-Lynch Wealth Management has an entire product line under "Wealth Preservation".
Maybe you should put it in the "non-speculative" category.