Wall Street Braces For More Carnage in the Near Term

knowsitall wrote:

Floor traders fear below 10,000 is certain. How much below is anybody's guess.

Buy and Hold just doesn't work anymore fellows.....unless you're talking about CDs.

I think it can work when you have a system that is functioning normally. I agree it won't work when you're dealing with an over-leveraged world of first housing and now groups of "underwater" countries. The unwind of national economies is going to be as painful, or worse, than the unwinding of the mortage market and financial sector in 2008.

the S&P and Nasdaq are getting crushed worse than the Dow-----they are better indicators--drop today was worse than Dow indicated----definitely a lot of fear out there but we are near the end of the correction....

knowsitall wrote:

Floor traders fear below 10,000 is certain. How much below is anybody's guess.

Buy and Hold just doesn't work anymore fellows.....unless you're talking about CDs.

Why would buy and hold not work????

Are you implying that the US stock market is done for the next 30 years?

If that is the case then we have a lot more to worry about than silly money.

Buy and hold will work just fine as long as your time frame is long enough.

People with 10 years to go might need to worry but if you have 30 years to go you will be fine.

Just ignore the doom and gloomers. They come out of the wood work during every bad time and then they disappear again during the good times..

Short term bounce if QE3 gets mentioned. Could come as soon as tomorrow.

Today was a capitulation of sorts, but the selling may not be done yet.

The real question is the possible bounce a pump and fade or a stoploss trigger desperation volume grab momo homo?

We may level off tomorrow, but don't know yet.

The markets are screwed if profit margins tank from high energy and the reordering of our consumer service driven economy which are two currently evolving trends.

I would bet 100% that the total stock market will not return your original investment adjusted for inflation in 30 years time.

You need to understand macro historical trends and cycles, I'm talking big huge waves of investment, trust, and business that last 50, 100, 500, even 1000 years.

We are currently entering a cycle of turbulence and uncertainty, and that is very very very bad for long term investments.

If we can't even have discussions about the value of the dollar in 10 years time, how can even begin talking about the stock market?

Most people graduate college at the age of 21, perhaps have student loans to pay for many years, but seldom have much money to invest until they are at least 25.

Can you imagine if you were 25 in the late 1990's and started investing and found that your investments in the stock market made you nothing by the age of 40? And if you invested in the NASDAQ, your investment return is closer to Japan (-50% or more). We created an entire generation of investors who made nothing from 15 years of investment in the stock market. Is that a long enough time frame?

Where is Flagpole when you need him?

not happening

DaveW wrote:

Most people graduate college at the age of 21, perhaps have student loans to pay for many years, but seldom have much money to invest until they are at least 25.

Can you imagine if you were 25 in the late 1990's and started investing and found that your investments in the stock market made you nothing by the age of 40? And if you invested in the NASDAQ, your investment return is closer to Japan (-50% or more). We created an entire generation of investors who made nothing from 15 years of investment in the stock market. Is that a long enough time frame?

Where is Flagpole when you need him?

This statement alone show everyone how much you don't know about stocks or mutual funds and how they work.

Long term investors invest in a wide range of sectors, bonds, stocks, foreign, domestic..so on and so on. I started investing in 97 and I'm doing just fine. I took a hit here or there but I invested broadly, some sectors were up some where down over the years but in the end during the time period you think no one made money i've averaged out about 7.8% over that 14 year period with very low risk. I know many many others who did better than that but I like to be safe.

I still have at least another 20 years until I'll think about retirement. Stay diversified and keep investing a certain amount each month and you will be fine.

The doom and gloomers will disapear in a few years and i'm sure we will hear from them again in another decade because this has happened before and will happen again.

And if I'm wrong and this is the end of the end then money want matter will it.

Yutty wrote:

DaveW wrote:

Most people graduate college at the age of 21, perhaps have student loans to pay for many years, but seldom have much money to invest until they are at least 25.

Can you imagine if you were 25 in the late 1990's and started investing and found that your investments in the stock market made you nothing by the age of 40? And if you invested in the NASDAQ, your investment return is closer to Japan (-50% or more). We created an entire generation of investors who made nothing from 15 years of investment in the stock market. Is that a long enough time frame?

Where is Flagpole when you need him?

One word my friend; dividends.

Thank you,

I was hoping Davew would come to this conclusion on his own but you helped him out a little with some basic investing 101.

Looking and S&P indexes, from 1/1/1999 to today;

SP500: DOWN 2.5% (annualized ROR is LESS THAN ZERO)

SP midcap: up 105%

Sp smallcap: up 108%

I'm a trend follower sitting on 60% SP500 and 40% gold when I originally bought the futures contracts, presently up 14%/yr unleveraged due to gold. Without gold, the annual unleveraged ROR is 4.9%. With leverage, the profit margins are quite high.

If you're going to be into buy-and-hold, the data seems to imply that you need to be in small caps. You can certainly buy ETFs that are the SP 600 small cal index. BUT--theoretically the risk goes up, but as a practical matter, the SP small cap index looks LESS risky than the SP500 and most mutual funds over the last 10-15 years.

Show me ONE large cap mutual fund that is up 108% since 1999.

Cut the bullshit. If funds were earning big returns due to dividends, they would appear in the listings. These are the top funds from Morningstar. EVERY one of the top funds over 10 years is a natural resources or energy fund--HIGH risk.

If you want to claim 9% return or more in the last 15 years due to dividends, you get the horse laugh. Total bullshit. The average domestic stock fund return over the last 10 years is 3 percent. And over 15 years, it's even less than that.

Some of this talk is sounding like Lake Wobeggon where all the children are above average.

You have to be smarter to get returns than just sit and hold mutual funds...or you have to make your facts up as you go along.

Nice post hmmmmmmmmmmm, and very much in line with my own stuff (I'm right at 9% annual growth for the period mentioned, and at about 10.6% annual growth since 1989 when I began investing). People who don't invest have lots of reasons not to (and incorrectly think they know something), and unless you really see those dividends coming in that get reinvested, you don't understand how much they help things.

Diytre wrote:

Up 2% already today. Back over 11,000. Hope you all were buyers yesterday.

... and sellers today.

Diytre wrote:

knowsitall wrote:

Floor traders fear below 10,000 is certain. How much below is anybody's guess.

Buy and Hold just doesn't work anymore fellows.....unless you're talking about CDs.

Up 2% already today. Back over 11,000. Hope you all were buyers yesterday.

Buyers? For what? This is a suckers pop. Let's see where things are at the close. After Bernanke says nothing.

The times they are a changing

Please, everyone, i am beggging you. Stop discussing this crap. I get on this site to escape my real world problems and read douchey commentary about hypothetical situations like "how much can Ryan Hall bench press" or " how fast could "Kara Goucher run the 110 hurdles carrying her son under one arm". Please.