Does anybody in the thread have a written investment policy statement they use to guide their investment decisions? We worked with a financial planner after we retired to double check we were financially prepared to retire :-D and one of the things she recommended was that we develop one of these. I found it to be a very worthwhile exercise as we had to think through our objectives, based on our lifestyle and spending plans, to come to the point where we had a target strategic asset mix that matched our objectives. It made us pull the wooly ideas out of the backs of our brains and formalize them in writing. Now they sit there as a reminder of what we've decided to do with our money, thus limiting the chance we will do something dumb in the moment that doesn't align with our goals.
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CG 2 wrote:
la gente esta muy loca wrote:
You can standardize CAPE (Shiller's) in Excel, just did a quick take, currently 2.58. July 1999 was 5.09; Sept 1929 was 3.68. The problem with back testing with this data are numerous; slippage, trading costs (Mayday 1975, Schwab was about $40 up until the mid 90s, by the late 90s I remember trades costing $4 online), you couldn't buy the S&P 500 Index institutionally (Wells Fargo) until 1972 and retail 1976 (Vanguard), taxes, the introduction of 401s etc, index options cca 1980, ETFs. You get the picture. Nite all.
It is 100x easier for the average person to put money in the market than it was 50 years ago. Any random person can download RH or set up a vanguard account and start putting money in something. Furthermore, access to information on how to do all this, what investing is about, why you should do it, etc, is all 1000x easier and faster to get than it was 50 years ago. This sort of thing is going to inflate things like PE ratios compared to pre-internet decades. It's part of why one can't simply compare numbers at present to historical averages. Conditions have changed somewhat over time.
Good points. The elimination of 1/8th of a point was also a big profit center for trading desks. However, I would tend to believe that it could spark a similar magnifying effect on the downside, especially if the perception is Treasury and the Fed are no longer able to save markets.
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Ghost of Igloi wrote:
He said in May a market crash of up to 65% would not surprise him.
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Sally Vix wrote:
Ghost of Igloi wrote:
He said in May a market crash of up to 65% would not surprise him.
I believe he was speaking of a future nadir in the market. From a historical valuation perspective I agree with Hussman. What you and others ignore is the massive amount of deficit spending continues. The Government sponsored Lemonade Stand prospers as fake markets hit new highs daily.
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Ghost of Igloi wrote:
Sally Vix wrote:
He said in May a market crash of up to 65% would not surprise him.
I believe he was speaking of a future nadir in the market. From a historical valuation perspective I agree with Hussman. What you and others ignore is the massive amount of deficit spending continues. The Government sponsored Lemonade Stand prospers as fake markets hit new highs daily.
According to that article, the last time he was right was 16 years ago.
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Sally Vix wrote:
Ghost of Igloi wrote:
I believe he was speaking of a future nadir in the market. From a historical valuation perspective I agree with Hussman. What you and others ignore is the massive amount of deficit spending continues. The Government sponsored Lemonade Stand prospers as fake markets hit new highs daily.
According to that article, the last time he was right was 16 years ago.
The last time the Fed, Treasury, and Congress behaved responsibly was 16 years ago.
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At the end of 2007, the Federal Reserve's balance sheet stood at roughly 0.9 trillion U.S. dollars. As of September 4, 2024, the Federal Reserve held approximately 7.11 trillion U.S. dollars in assets.Sep 9, 2024
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U.S. debt was $9 Trillion in 2007, and just over $35.5 Trillion today.
Correlation to markets, and perceived stock valuations?
It hasn’t worked out well for commercial real estate, where yield and capital appreciation intersect. Oh, that’s right, it was all work from home that destroyed the mirage.
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Folks ignore at their own peril…
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Have you ever seen a stock with this king of performance in a day?
Sanuwave
12.00+11.97(+39,900.00%)It had a reverse 1-375 stock split so maybe they miscalculated it.
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Sally Vix wrote:
Have you ever seen a stock with this king of performance in a day?
Sanuwave
12.00+11.97(+39,900.00%)It had a reverse 1-375 stock split so maybe they miscalculated it.
Split adjustments, especially for small companies take several hours, even 24 hours.
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Ghost of Igloi wrote:
Folks ignore at their own peril…
actually, bad example.
ignoring unrealized losses at banks because of temporary loss of value of bonds is exactly the sort of thing that should be ignored. Because the bonds will mature at full value. Well, not ignored but not taken too seriously either. in any case, regional banks are up 53% over the past year. A year ago what was everyone worried about? You got it: unrealized losses on banks' bond portfolio.
and a potential recession.
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Ghost of Igloi wrote:
Sally Vix wrote:
Have you ever seen a stock with this king of performance in a day?
Sanuwave
12.00+11.97(+39,900.00%)It had a reverse 1-375 stock split so maybe they miscalculated it.
Split adjustments, especially for small companies take several hours, even 24 hours.
Oh okay, Igy - thanks!
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agip wrote:
Ghost of Igloi wrote:
Folks ignore at their own peril…
actually, bad example.
ignoring unrealized losses at banks because of temporary loss of value of bonds is exactly the sort of thing that should be ignored. Because the bonds will mature at full value. Well, not ignored but not taken too seriously either. in any case, regional banks are up 53% over the past year. A year ago what was everyone worried about? You got it: unrealized losses on banks' bond portfolio.
and a potential recession.
Of course that is nonsense, but such logic is why investors keep buying stocks.
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Ghost of Igloi wrote:
agip wrote:
actually, bad example.
ignoring unrealized losses at banks because of temporary loss of value of bonds is exactly the sort of thing that should be ignored. Because the bonds will mature at full value. Well, not ignored but not taken too seriously either. in any case, regional banks are up 53% over the past year. A year ago what was everyone worried about? You got it: unrealized losses on banks' bond portfolio.
and a potential recession.
Of course that is nonsense, but such logic is why investors keep buying stocks.
well you tell me why regional bank stocks are up 50% from a year ago, when people had just the same concern you brought to the thread.
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