View Full Version : Boy, that Dow
iris lilies
11-5-19, 3:23pm
Sure is high.
Yep. Ive been moving stuff to cash. Too old to endure a great loss.
I've been largely sitting out this fun-fest, as I'm in the final stages of a 1.5 year long divorce process, and didn't want last-minute market fluctuations to mess up the negotiations.
And there's a certain amount of increased forward-looking risk averseness until I really get my new life/budget verified with some reality testing.
We have always had a huge chunk in cash as my insurance policy. Allows me to look at the market with less emotional involvement.
Sure is high.
Where did I read that it is just a few stocks generating the increases and many of them are on a company buy-back driving the prices high. People are struggling to find a way to invest for a good return on less volatile options. Still, the stocks have done very well despite the naysayers. It is knowing when to step away.
I generally find that the less attention I pay to my investments the better they seem to perform.
Getting close to adjustment time again. I’m going to need some cash for the new house and boat. Also wondering about taxes in the future if the democratic socialist get their way.
Also wondering about taxes in the future if the democratic socialist get their way.
If they carry out some of the more free-stuff-for-all plans, I stand to personally benefit greatly, if I can properly structure my income and assets. Yay?
ApatheticNoMore
11-5-19, 5:17pm
I'd stand to benefit greatly too, anyone who has ever worried about getting healthcare outside of a generous employer, and before age 65 would benefit greatly of course, not always short term in some cases - might be some adjustment there, but in the true long run.
But no I never worry about stock fluctuations and never try to time the market, I just do balanced funds and let it ride. Because I'm not necessarily ever going to be any good at timing it anyway.
I might not benefit that much, since I already am a beneficiary of a "socialist" program: Medicare, which is far superior than the crappy expensive insurance plan I had previously. And my tax burden hasn't changed with Trump. I'm just as non-wealthy as I ever was.
I pulled a hefty sum out in July to pay for a new camper and pickup truck to tow it with. Over these past 4 months the market has replaced every cent I took out, I feel like my big ticket purchases were free.
iris lilies
11-5-19, 5:29pm
I pulled a hefty sum out in July to pay for a new camper and pickup truck to tow it with. Over these past 4 months the market has replaced every cent I took out, I feel like my big ticket purchases were free.
yeah, same here! I wonder if I can pull enough for another convertible out this time, maybe I’ll get a white one instead.
Most of mine is in tax deferred, if I pull any more it will cost me 24%. I’ll probably pull some out in January, but stay under the 24% amount.
if it looks like warren or Bernie has a chance I’ll go to mostly cash and possible pull a good chunk out, pay the taxes now.
iris lilies
11-5-19, 6:09pm
Well, when I say “pull out” I mean I moved gains from an index fund to cd type fund, all within my 401k equivalent account. The money to purchase my new car came from existing cash accounts.
DH gets pale when I talk about pulling out gains because he worries about the tax consequences.
iris lilies
11-5-19, 7:02pm
We have always had a huge chunk in cash as my insurance policy. Allows me to look at the market with less emotional involvement.
I wish I knew what percentage of our financial assets are in cash or cash equivalents like CDs.
You could say “well Iris why don’t you figure it out “ but you know what? It’s kind of complicated. I am actually thinking about sending it all to my main investment guy and just say dude, figure this out for me, willya? Up to now we have kept the investment guys segregated from each other.
I hadnt bothered looking at my etrade account in a few months but was inspired by this thread to do so. While it is up about 17% for the year it actually said that i was down about .5% for the day today. 🤔
iris lilies
11-5-19, 8:32pm
I hadnt bothered looking at my etrade account in a few months but was inspired by this thread to do so. While it is up about 17% for the year it actually said that i was down about .5% for the day today. 樂
You didnt catch it at 3 pm. It ended only a bit ip feom yesterday. But yesterday was good.
I've let my investments run with the winds the last couple of years and am in the middle of consolidating and re balancing. I'll be trying to stick to my fixed income to equity goal and am glad for whatever run up we've had, but the PE's on stocks are getting to be a little high for my tastes. I only wish interest rates were a little higher. It seems like any more the system is set up to get into a little more risk than I like just to keep up with inflation.
flowerseverywhere
11-6-19, 6:57am
We don’t pay a lot of attention but stick to some basic rules as we always have.
Set you stock/bond/cash allocation and rebalance every six months or so,
don’t panic or react to what you think would affect the market. Sometimes we hear some news and think the market is going to crash or soar and it often does the opposite
taxes are inevitable if you want schools, roads and disaster help if a hurricane, tornado, earthquake, flood, fire etc. hits.
It really is interesting that really only the more wealthy citizens in the country own most of the stocks. Depending on where you are getting your facts, the top ten percent own about 84% of all the stocks. Capital builds more wealth even if you have a modest amount in the stock market, while the bottom economic half of the country see little to no gain. As was true with the tax cuts.
iris lilies
11-6-19, 9:31am
It really is interesting that really only the more wealthy citizens in the country own most of the stocks. Depending on where you are getting your facts, the top ten percent own about 84% of all the stocks. Capital builds more wealth even if you have a modest amount in the stock market, while the bottom economic half of the country see little to no gain. As was true with the tax cuts.
To the bolded: That is exactly the statistic that gives Warren her next cut at “wealth” taxing. After the 1% are the 10%ers.
Not hard to reach down to them, and that includes many people here.
flowerseverywhere
11-6-19, 11:55am
To the bolded: That is exactly the statistic that gives Warren her next cut at “wealth” taxing. After the 1% are the 10%ers.
Not hard to reach down to them, and that includes many people here.
exactly. The same old argument that will never get resolved, especially on a discussion forum. And it is getting increasingly difficult to decipher what it all means and what is tru with all the tweeting, texting, options etc that bombard us everyday.
Teacher Terry
11-6-19, 12:54pm
When I worked for the state I was amazed at the number of people that didn’t participate in the deferred compensation program. It’s the first thing I did when I got the job.
When I worked for the state I was amazed at the number of people that didn’t participate in the deferred compensation program. It’s the first thing I did when I got the job.
It’s also sad how many people borrow against them, cash them out when terminating or even forget about them. Another thing I sometimes saw was people who didn’t update their deferred compensation or pension beneficiaries after a divorce. Years later when the participant died, there were some very perturbed current spouses. I swear a lot of folks put more thought into their Black Friday strategy than planning their retirement.
It’s also sad how many people borrow against them, cash them out when terminating or even forget about them. Another thing I sometimes saw was people who didn’t update their deferred compensation or pension beneficiaries after a divorce. Years later when the participant died, there were some very perturbed current spouses. I swear a lot of folks put more thought into their Black Friday strategy than planning their retirement.
Dollar cost averaging takes time. People want $ growth to be instant, so they don't even bother to start.
flowerseverywhere
11-6-19, 6:50pm
Dollar cost averaging takes time. People want $ growth to be instant, so they don't even bother to start.
that is so true. My kids have coworkers in their forties who just haven’t gotten around to starting retirement savings. I dn’t Know who they think is going to take care of them when they get old.
Geez. I’m at the other end of the spectrum. I was super excited when i got old enough to be able to do the ‘catch up’ contributions to my 401k. And with a 100% employer match on the first 6% this seems like a real no brainer.
Thinking about beneficiaries, SO had a roommate before we moved in together who had not updated his durable power of medical attorney after he broke up with his boyfriend. Two years later, in his early 30’s he came down with encephalitis. The ex had to come back to NJ (current boyfriend in tow) to make the decision to end life support.
ApatheticNoMore
11-6-19, 9:01pm
In this day and age it's expecting way too much from employers.
If I have a 401k, I can't figure out how to use it, and I suspect it may not really exist, but I'll pour through fine print maybe (see I was told one existed initially ...). Anyway there is no matching (if there even is a 401k), I've put no money into it (so it's not like I've lost track of actual money here). And so it doesn't really matter, I know how to put money into an IRA on my own thanks and do.
Meanwhile my boyfriend is enrolled in a 401k that seems like a scam, like the employer literally seems to maybe be pocketing the money (oh that guy is sleazy who knows), so I keep telling him to verify that it's legit (ask the brokerage if an account really exists, because maybe it does and it's legit, it's just things smell really funny there).
Most 401ks aren't scams of course, but depending on employers having them, yea good luck with that.
I just kiss the ground I've got decent employer healthcare. Unlike IRAs which are a 401k alternative although alas not as generous, options for decent healthcare coverage outside of employment is pretty much non-existent presently.
In this day and age it's expecting way too much from employers.
If I have a 401k, I can't figure out how to use it, and I suspect it may not really exist, but I'll pour through fine print maybe (see I was told one existed initially ...). Anyway there is no matching (if there even is a 401k), I've put no money into it (so it's not like I've lost track of actual money here). And so it doesn't really matter, I know how to put money into an IRA on my own thanks and do..
What you are loosing is the ability to put more $ away pre-tax. HR should give you all 401k information. Call benefits!
In this day and age it's expecting way too much from employers.
If I have a 401k, I can't figure out how to use it, and I suspect it may not really exist, but I'll pour through fine print maybe (see I was told one existed initially ...). Anyway there is no matching (if there even is a 401k), I've put no money into it (so it's not like I've lost track of actual money here). And so it doesn't really matter, I know how to put money into an IRA on my own thanks and do.
Meanwhile my boyfriend is enrolled in a 401k that seems like a scam, like the employer literally seems to maybe be pocketing the money (oh that guy is sleazy who knows), so I keep telling him to verify that it's legit (ask the brokerage if an account really exists, because maybe it does and it's legit, it's just things smell really funny there).
Most 401ks aren't scams of course, but depending on employers having them, yea good luck with that.
I just kiss the ground I've got decent employer healthcare. Unlike IRAs which are a 401k alternative although alas not as generous, options for decent healthcare coverage outside of employment is pretty much non-existent presently.
Every 401k I've ever had included statements sent to me every month...
I would call HR and I track down info on the 401k. Glad you have an IRA, too.
ApatheticNoMore
11-7-19, 11:33am
Every 401k I've ever had included statements sent to me every month...
yea I get occasional communications even from an old (needs to be rolled over in truth) 401k. But with bfs 401k, no communication ever, apparently has no website login or something with a brokerage I know has a web login, tells me there is no choice in investments (uh some choice exists everywhere I have ever worked even when it's not great funds - at least of a stocks fund or bond fund etc.), etc.. Just money is taken from the paycheck and where it goes nobody knows. I nag about it and it may sink in, but I'm not people's mommy.
Me I can contact benefits, but I have put no money in, it's just whether the potential of using a 401k exists or not which seems to be as obscure as I've ever seen anywhere. Been here a bit over 2 months.
ApatheticNoMore
11-8-19, 6:52pm
I found out about the 401k, apparently I'm not eligible for it until a period that corresponds to around 6 months of employment and then the option to enroll will magically appear on the website etc.. I guess that's why this was so obscure maybe, to the point I had no idea whether or not there was a 401k. I was always told there was no 401k matching though.
iris lilies
11-9-19, 11:32am
Dollar cost averaging takes time. People want $ growth to be instant, so they don't even bother to start.
Exactly.
I was having a discussion recently with a younger friend probably around 35 years old and she wants to start investing. She said “but I can’t lose any money.” I told her honey you are going to lose money, you’re going to put in $100 today and tomorrow it’ll be worth $97, get used to it.
But better yet just put in the money every month and don’t look at it don’t pay attention to it except once a year, and then maybe move things around. Or dont.
To the youngsters here: plunk money into a dollar cost average habit, invest in a couple of Vanguard index funds. Done.
catherine
11-9-19, 12:36pm
Exactly.
I was having a discussion recently with a younger friend probably around 35 years old and she wants to start investing. She said “but I can’t lose any money.” I told her honey you are going to lose money, you’re going to put in $100 today and tomorrow it’ll be worth $97, get used to it.
But better yet just put in the money every month and don’t look at it don’t pay attention to it except once a year, and then maybe move things around. Or dont.
To the youngsters here: plunk money into a dollar cost average habit, invest in a couple of Vanguard index funds. Done.
I tried to tell my kids that. They do their 401k's, but they don't have any savings beyond that. I was thinking of just starting very small sums and contributing regularly to a Vanguard index fund for my grandkids--I'm talking like $25/mo for each grandkid... even that small amount would add up to about $10k each when they're adults. Could get them a used car or closing costs on a house. Just seems like a waste not to do it.
Simplemind
11-9-19, 1:04pm
Unfortunately I was oblivious to Deferred Comp when I first started with the City. Several lost years later another single co-worker started talking to me about it and I started low. Then I put every raise in there. Then I kept inching it up. When I got married in 2001 I started to max it and then when I became of age I maxed and played catch up. It did very very well. When I retired early at 55 I had more in my Deferred Comp than I did in my government pension. Between my pension and SS that I took last year at 62 I don't know when I will even need to touch it. I was so grateful for that initial conversation and passed on the favor to several other single women who thought they could never afford it. Start low, inch it up.
I tried to tell my kids that. They do their 401k's, but they don't have any savings beyond that. I was thinking of just starting very small sums and contributing regularly to a Vanguard index fund for my grandkids--I'm talking like $25/mo for each grandkid... even that small amount would add up to about $10k each when they're adults. Could get them a used car or closing costs on a house. Just seems like a waste not to do it.
That's what I think, too! I set up an account for each grandchild with 2400 each and put in a hundred dollars at Christmas and birthday. I wanted to do more, but life happened and so I'm okay with the birthday/Christmas schedule. I am hoping they will have enough for a small house downpayment.
It's extremely fun, too--when their parents were little, I did the same for each child but put it in a mutual fund that concentrated on products children would recognize--I think it was called the Stein Roe Young Investor Fund or something like that, and it taught about investment, too.
We used that money for college, unfortunately. Will not make that mistake again with the grandchildren.
But I do buy individual stocks as well as index funds-- Apple, VISA, Target, things they will recognize.
I'm sorry savings accounts have been made passe' by aggressive marketing of equities and purposeful lowering of interest rates. It would be nice to have that as a viable option, at least.
I'm sorry savings accounts have been made passe' by aggressive marketing of equities and purposeful lowering of interest rates. It would be nice to have that as a viable option, at least.
Sadly that option is definitely gone and not likely to ever come back.
I recall reading somewhere that before the great depression hit the standard was that stocks should pay a higher dividend than the interest rate on bonds. The idea being that with bonds you were likely to get back your principal unless the company went bankrupt, whereas with stocks that wasn't at all a guarantee. After WWII a sizable chunk of investors waited for that to be the case, sticking with bonds. Now, almost 75 years later, anyone who took that strategy is still waiting and missed out on a massive boom of increased asset values in equities.
Personally I've still got 8-12 years before I plan to retire. And I'm lucky to work in a field that currently doesn't have enough qualified people, so I'm unlikely to get pushed out by an ageist employer so I will hopefully be able to work as long as I want. At this point I'm still heavily invested in stocks. Mostly a combination of blue chip stuff I inherited from my father and a couple of index ETF's, but still stocks, nonetheless. As I noted upthread they are doing really well. As time progresses I plan to shift to more conservative investments, but I've accepted the fact that I will never likely have a sure thing like decent interest rates on savings accounts.
pinkytoe
11-10-19, 12:17am
I was thinking of just starting very small sums and contributing regularly to a Vanguard index fund for my grandkids--I'm talking like $25/mo for each grandkid
I started that with my grand-twins last January. Auto savings at Ally - only $50 a month ($25 each) - but already it is $500+ and will grow to thousands if we just forget about it.
bicyclist
11-13-19, 3:06pm
The Dow goes up and the Dow goes down! The Dow drops 20% on a pretty regular basis but recovers eventually. "Eventually" is an important qualifier. The Dow does not fall or rise on an exact schedule. That's why it is important to focus on factors under one's control instead of attempting to outguess the other investors in the markets. No one has a crystal ball. Set reasonable goals based on your likely income and expenses. I have to keep close track of both and have a good sense of what I will go through. I am also a beneficiary of Medicare, the socialist program that few beneficiaries want to get rid of.
In this day and age it's expecting way too much from employers.
If I have a 401k, I can't figure out how to use it, and I suspect it may not really exist, but I'll pour through fine print maybe (see I was told one existed initially ...). Anyway there is no matching (if there even is a 401k), I've put no money into it (so it's not like I've lost track of actual money here). And so it doesn't really matter, I know how to put money into an IRA on my own thanks and do.
Meanwhile my boyfriend is enrolled in a 401k that seems like a scam, like the employer literally seems to maybe be pocketing the money (oh that guy is sleazy who knows), so I keep telling him to verify that it's legit (ask the brokerage if an account really exists, because maybe it does and it's legit, it's just things smell really funny there).
Most 401ks aren't scams of course, but depending on employers having them, yea good luck with that.
I just kiss the ground I've got decent employer healthcare. Unlike IRAs which are a 401k alternative although alas not as generous, options for decent healthcare coverage outside of employment is pretty much non-existent presently.
go to www.freeerisa.com and search for the boyfriend's company. They're required to file a 5500 return for the plan. Free ERISA allows you to search for recent returns (not sure if 2018 would be available, but 2017 should be). It will document the number of participants, the assets, expenses, providers, etc.
I'm sorry savings accounts have been made passe' by aggressive marketing of equities and purposeful lowering of interest rates. It would be nice to have that as a viable option, at least.
That's my opinion also. I still flinch a little thinking about the financial melt down and how much some people lost in the market based on an over exuberance in equities. Of course it came back and more, but for people close to retirement or in retirement it could affect a person's financial planning. One of the reasons why I have been and still am conservative. Stocks are not quite like going to Vegas, but as they say, past performance is no guarantee of future returns. It's too bad a person can't beat inflation or even come out a little ahead with most bank time deposits. Maybe low interest rates are temporarily good for the economy but they are not so good for people like me.
ApatheticNoMore
11-13-19, 7:19pm
Well interest rates had to be cut 3 times to get this record Dow, getting pretty low now (not much room to maneuver the fed says). And more deficit spending too. In a so called good economy, well it ain't counter-cyclical - we're not in Keynesianism anymore. But Trump's got his boom, his reelection perhaps, and he could shoot someone on 5th Avenue now and it wouldn't matter maybe.
ApatheticNoMore
11-13-19, 7:21pm
go to www.freeerisa.com and search for the boyfriend's company. They're required to file a 5500 return for the plan. Free ERISA allows you to search for recent returns (not sure if 2018 would be available, but 2017 should be). It will document the number of participants, the assets, expenses, providers, etc.
ok he seemed assured that someone at work told him they get statements at the end of the year.
APN, check to see if you can roll your old 401k into your IRA. I have done that. That way, you are in control of it and you know what you have.
APN, check to see if you can roll your old 401k into your IRA. I have done that. That way, you are in control of it and you know what you have.
You definitely can do that. (By law). However, you need to do so into a rollover IRA but brokerages are happy to set up a separate rollover account for people. All my old 401k’s except my most recent former employers are in one.
The Dow hit 28000 today. Woohoo!
It seems like only yesterday (although it's more like 2 or 3 years ago yesterday) that I kept telling myself that I'd make adjustments when and if the Dow ever hit 18000. I never did make those adjustments but I'm wondering if now isn't the perfect time?
I guess I would stay my course with respect to asset allocation. I have always been extremely conservative, so I can't afford to become more conservative.
I am adjusting over time to a more simplified portfolio, because I saw my mother get dementia, and I would like things simple when I get to be closer to the age when she got sick, if that makes sense. No one else in my family is interested in the market, so unless that changes, I will need to get simpler as time goes by.
I think adjustments depend so much more on your personal life circumstances than what is going on in the market. But obviously, you know that.:)
frugal-one
11-15-19, 10:48pm
Put $1000 in local utility stock when granddaughter was born and have dollar cost averaged $100/month since. Staggering how much it has grown considering the conservative bend.
SteveinMN
11-16-19, 12:19pm
I kept telling myself that I'd make adjustments when and if the Dow ever hit 18000. I never did make those adjustments but I'm wondering if now isn't the perfect time?
No one ever knows the "perfect" time. But I think there's been enough growth to at least rebalance or take some profits and move them wherever you want/need them. We've been pretty aggressive all along but are pulling that back a little as we approach retirement. Moving some of that money around is on my immediate-action to-do list.
No one ever knows the "perfect" time. But I think there's been enough growth to at least rebalance or take some profits and move them wherever you want/need them. We've been pretty aggressive all along but are pulling that back a little as we approach retirement. Moving some of that money around is on my immediate-action to-do list.
Great point, Steve--for many it is definitely time to rebalance to get back to their chosen asset allocation.
The question of what is an appropriate asset allocation for retirement years is of course another related topic, and they are both important.
Teacher Terry
11-16-19, 1:24pm
We pulled some of the money out of stocks a few months ago.
It just keeps getting better. I may need to rebalance again soon.
iris lilies
1-16-20, 11:43am
Yesterday’s mail brought a statement from my pension fund, City of St. Louis. Their pension fund managed to lose assets in 2019, down from 2018. Brilliant.
I just re balanced a few months ago, but I'm looking to do it again. I try to keep up with a few general articles about any future stock performance and am not seeing many warning signs, but I don't think this can keep up for much longer. As they say, past performance does not guarantee future returns.
29, 219. Has anyone else spent the last few months saying no, I won't get in now, it's overvalued? Like, saying that every other day? :doh:
29, 219. Has anyone else spent the last few months saying no, I won't get in now, it's overvalued? Like, saying that every other day? :doh:
No, I stay invested in my asset allocation, pretty strictly. I have 2 years of cash so I don't have to worry about selling in a down market.
If I could still buy govt farm bonds for 11% like back in the good old days, I'd have it all in fixed income.
But you can't make enough on fixed income, so out into the market I go.
Well, some people have enough that they can make enough, and that's what I would do if I were rich, I guess.
I guess for me it's a case of FOMO. I do have enough bond income to live, although it would be a tight budget. But I have some cash that I could have invested in stock even as late as November when this thread started, and gotten an amazing return. fear of missing out vs. fear of jumping in. I really gotta work on my risk aversion!
Maybe, maybe you just need to figure out an asset allocation you are happy with?
Two books I have really liked at Gillette Edmunds Comfort Zone Investing
https://www.abebooks.com/servlet/BookDetailsPL?bi=30033799282&searchurl=sortby%3D17%26tn%3Dpeace%2Bof%2Bmind
and this retirement book by Wes Moss:
https://www.amazon.com/You-Retire-Sooner-Than-Think/dp/007183902X/ref=sr_1_1?crid=2QHGWUPBXIXM6&keywords=you+can+retire+sooner+than+you+think&qid=1579209235&sprefix=you+can+retire+%2Caps%2C174&sr=8-1
They both help me to conceptualize a life in retirement, and the Edmunds book is really different--goes into the psychology of different asset classes, and helps me to figure out why I like what I like and why some things feel bad to me. The Edmunds book is a sleeper, I think. It's different, but it's helped expand my thinking about investing.
So how high can this go before it evens out or crashes? I've never seen anything like this in my many years of investing.
ApatheticNoMore
1-17-20, 11:28am
The fed is doing QE and that's why the market is so high:
https://wallstreetonparade.com/2020/01/federal-reserve-admits-it-pumped-more-than-6-trillion-to-wall-street-in-recent-six-week-period/
that's a blog, ok fine, bloomberg fwiw:
https://www.bloomberg.com/news/articles/2020-01-17/the-debate-over-whether-to-call-it-qe-is-over-and-the-fed-lost
And that means for investing? I could not possibly tell you, I'm not that smart, maybe just stick to your allocation if it makes some sense generally.
But as far as understanding society, the stock market is high because government money is being dumped into it,kinda period. This stock market stuff is going to be used against us, if they want to get Trump reelected on it they will try (well um if the candidate was Bloomberg he'd publish it :~) hahaha gotta love plutocracy).
I just sold a big chunk of stock to harvest the profits. It was hard to do it since I might miss out on more gains and this particular stock has been performing exceptionally well, but we'll be needing that money in the next couple of years and I decided to err on the side of caution. Now I have to find something relatively safe to park it in.
Is it money you will need for planned living expenses, where you want to keep it in cds or a money market type account? Or are you just looking to profit-take and put it in a different kind of stock that is less volatile?
Let's see, we'll need about $5k in the next 1-2 months for taxes on a 401k/IRA conversion and a large purchase I just made. Then, in about 1 year, DH might do an unpaid internship (he's switching careers), so we might need living expenses for a few months. And then in about 3 years we will be relocating so I anticipate we'll have some expenses with that.
I'm considering something like the Vanguard Short-Term Federal Fund Admiral Shares (VSGDX) because I just want to park it and leave it, and just pull out what we need when we need it. Of course, the $5k will go straight to savings now.
Also considering Vanguard California Intermediate-Term Tax-Exempt Fund Admiral Shares (VCADX) - a bit more risk/reward.
gimmethesimplelife
1-17-20, 4:52pm
Sure is high.Exactly. I recently moved the money I saved in the 401 (K) set up by Scottsdale Healthcare (a local hospital with two facilities that has since merged with another local hospital) to an IRA at Navy Federal Credit Union for this very reason.....I am amazed at how the small amount of money I managed to save back in 2005 has grown and I'm not a greedy person - the returns I have realized are more than enough for me. The market is just way wicked overpriced with insane PE ratios and I felt the need for safety as if something catastrophic does happen, the market sure has a long, long, long way to fall these days.
I can remember when I was in college in the Fall of 1987 - there the Black Friday event - and I believe then the market sank to something like a 1,700 Dow. And now, 32 years and a few months later the Dow is at 29,000 plus? Just doesn't seem sustainable to me in the long term. Safety sounds good to me these days. Rob
Let's see, we'll need about $5k in the next 1-2 months for taxes on a 401k/IRA conversion and a large purchase I just made. Then, in about 1 year, DH might do an unpaid internship (he's switching careers), so we might need living expenses for a few months. And then in about 3 years we will be relocating so I anticipate we'll have some expenses with that.
I'm considering something like the Vanguard Short-Term Federal Fund Admiral Shares (VSGDX) because I just want to park it and leave it, and just pull out what we need when we need it. Of course, the $5k will go straight to savings now.
Also considering Vanguard California Intermediate-Term Tax-Exempt Fund Admiral Shares (VCADX) - a bit more risk/reward.
If I were in your shoes, I would break it down like this:
Let's see, we'll need about $5k in the next 1-2 months for taxes on a 401k/IRA conversion and a large purchase I just made.
I would put 5k into savings/money market checking account.
Then, in about 1 year, DH might do an unpaid internship (he's switching careers), so we might need living expenses for a few months.
I would also put this amount into the savings/money market-checking account.
And then in about 3 years we will be relocating so I anticipate we'll have some expenses with that.
I would put this amount into VSGDX. I would not fuss around with VCADX worrying about risk/reward.
I can remember when I was in college in the Fall of 1987 - there the Black Friday event - and I believe then the market sank to something like a 1,700 Dow. And now, 32 years and a few months later the Dow is at 29,000 plus? Just doesn't seem sustainable to me in the long term.
Back on Black Thursday and Black Monday, in 1929, the market lost about a quarter of its value, roughly the same amount it lost on Black Monday, 1987. If the market fell by that same percentage next week, it still would close at around 22,000. Granted, the 1929 market continued to slide into the Great Depression, with stocks losing about 90% of their value from their 1929 top. But the trend has been up: the market close that Monday in 1929 was just 230.07.
While none of us have been in the market since the '30s, market expansion has been steady despite recessions, wars, crummy economies, etc. In the meantime, buying something that cost $1,000 even just back in 1987 will cost more than twice that today. I think we can consider the market broadly sustainable and most people should have some exposure to it as a hedge against inflation.
It still makes sense, though, to take some profits when you get them, especially when one gets to the stage in life at which there isn't a decade or two to recover from a serious setback. We've moved some stock market gains to investments that offer less upside and -- more importantly -- less downside. But cashing in now? Probably not the best move for most people.
I believe it's artificial. Trump's friends will keep it going up until after the election. Then....who knows WTH will happen!
I believe it's artificial. Trump's friends will keep it going up until after the election. Then....who knows WTH will happen!
I'm feeling that too. Like SteveinMN, we moved some of our gains to more conservative investments as we are at an age where we cannot withstand a long recovery period.
There used to be a pretty reliable inverse relationship between gold and conservative bonds, and stock. To my way of thinking, money would get shifted from conservative investments to risky ones if the market /economy / jobs outlook seemed to be on a roll, pushing up stock prices and dropping those of less desirable gold and bonds in a bull market, and vice versa if it looked shaky. I am seeing no decline in the cost of purchasing conservative investments, which makes me think this vast influx of stock investing money is New money, not reallocation. Where's it coming from? If it's new money, can we trust it and ride its coattails up up up, or is this another untrustworthy bubble? diced-up supbrime mortgages that turned out to be a Whole lot less risk-free than perceived thanks to improper rating was a primary cause of the 80s mess. ... I'm trying to "follow the money" this time and I just don't have enough knowledge / info to do it ...
or is this another untrustworthy bubble?
I've lived through two bubbles, the dot.com bust and the subprime mess. And this sure feels like those last two. It seems like sky's the limit with no end in sight. I have no solid proof to back it up. It's just a feeling. Although what you said about not seeing the inverse relationship between conservative investments and stocks makes sense. Something just seems off.
The stock I sold last week has gone up almost 3%. That's over $4,000 I missed out on. Reminding myself that it's also $4,000 I could have lost. #don'tbegreedy
iris lilies
1-21-20, 1:24pm
The stock I sold last week has gone up almost 3%. That's over $4,000 I missed out on. Reminding myself that it's also $4,000 I could have lost. #don'tbegreedy
Yes! Congratulate yourself for locking in that gain!
There used to be a pretty reliable inverse relationship between gold and conservative bonds, and stock. To my way of thinking, money would get shifted from conservative investments to risky ones if the market /economy / jobs outlook seemed to be on a roll, pushing up stock prices and dropping those of less desirable gold and bonds in a bull market, and vice versa if it looked shaky. I am seeing no decline in the cost of purchasing conservative investments, which makes me think this vast influx of stock investing money is New money, not reallocation. Where's it coming from? If it's new money, can we trust it and ride its coattails up up up, or is this another untrustworthy bubble? diced-up supbrime mortgages that turned out to be a Whole lot less risk-free than perceived thanks to improper rating was a primary cause of the 80s mess. ... I'm trying to "follow the money" this time and I just don't have enough knowledge / info to do it ...
It's a combination of the republican tax scam giving rich individuals much more money to invest and corporations much more money to repurchase stocks, plus the fed's aggressive quantitative easing, as was noted above.
https://www.marketwatch.com/story/the-federal-reserve-is-stuck-in-quantitative-easing-hell-2020-01-16
The party will come to an end, but trying to time it is a fool's errand. You, nor I, nor anyone on this board, has the insider knowledge necessary to get out before the decision is made to let it go down.
It's a combination of the republican tax scam giving rich individuals much more money to invest and corporations much more money to repurchase stocks, plus the fed's aggressive quantitative easing, as was noted above.
https://www.marketwatch.com/story/the-federal-reserve-is-stuck-in-quantitative-easing-hell-2020-01-16
The party will come to an end, but trying to time it is a fool's errand. You, nor I, nor anyone on this board, has the insider knowledge necessary to get out before the decision is made to let it go down.
So you honestly think the markets are manipulated to that extent, and that it's just matter of someone giving the signal to "let it go down"?
So you honestly think the markets are manipulated to that extent, and that it's just matter of someone giving the signal to "let it go down"?
It may not be a formal decision. It may instead be a case of them simply not being able to prop it up anymore despite all the efforts to the contrary.
But yeah, the amount of ‘money’ that the fed creates out of thin air is significant and u doubted it is a significant effect on the market. The massive tax cuts are just more fuel for the fire.
Stocks are on sale thanks to the coronavirus. Time to buy again.
Teacher Terry
1-28-20, 12:40pm
Last night we went to a financial presentation that included a free steak dinner at a very nice restaurant. It was for a fixed annuity. I was surprised at the number of people that made appointments to meet with him later.
iris lilies
1-28-20, 2:16pm
Last night we went to a financial presentation that included a free steak dinner at a very nice restaurant. It was for a fixed annuity. I was surprised at the number of people that made appointments to meet with him later.
I think an annuity is a decent choice for SOME of one’s assets and for some people. For us, I think DH will live long enough to make it an option for him. But I doubt that we will buy one.
Yesterday, I saw a small stock I was holding go up slightly. I decided to sell it but put a conservative stop limit in place (this means if the stock goes below a certain price, the sale is immediate at that price, so you don't wind up watching something spiral into oblivion). The stock went up a little, had an 8% instantaneous loss and bounced back up within seconds, bumping me and all the other good little investors out at a much lower price than we expected. It then went on to increase 48% over the course of One Day, doing this insanely dramatic blink of a bounce two more times. (I think of it like the bounce of a jacks ball, all the little jacks scooped up for the split second while the ball's in the air.) So yes, I believe there is a "they" out there, and I have no doubt the market is being manipulated to their needs.
I have an fixed index annuity, an IRA and a pension. I think of it as diversifying. If the market tanks, at least my pension and annuity payments remain the same.
I rebalanced about a month ago, I guess it will help a little. If it drops much more I’ll need to rebalance back by buying more stock. I much prefer selling stock because it has gone up, instead of buying because it has fallen.
One thing I need to consider is with the market down, so are interest rates. I’m buying a house next month and I’m really thinking of getting a loan as the rates are around 3%. Something to consider.
I can imagine Donald pressuring the Fed to cut rates. I don't know if that could affect mortgage rates in the future. I was lucky to do some major re balancing out of equities over the last couple of months. I don't see balancing back into stocks anytime in the near future. If it should come to some sort of economic crisis I don't think the Trump economy is prepared for the same type of stimulus we had with Obama last time. Interest rates are already near rock bottom and the national debt and government spending are already at record highs without any additional stimulus.
I went into an established neighborhood Chinese restaurant today for lunch. They are usually about half full during lunch hour, but I was their only customer today. I sort of felt sorry for them.
Is anyone buying? Staying the course -- for now, anyway. Even with all the -- umm -- activity of the last few days, we're still in "correction" territory, a place the market hasn't been in a while. If we'd sold big-time or got out we would have missed a market that almost hit 30,000 just a few weeks ago. We rebalanced as we move toward DW's retirement. But it will have to get worse for a little while longer before we make a stronger move toward the exits.
I have about 5 years' of cash on-hand for living expenses, so I don't feel any rush to panic about the market panic at the moment.
Our net worth is about 30% cash or equivalents and probably much higher depending on how you fit in pension and SS. It is what allows me to sleep at night and not obsess over the stock market. This will probably last a fair bit of time until the supply chains are sorted out. I have no impact on what other countries do, so I can only concentrate on what is going on right around me.
I think of bond mutual funds as "almost cash" barring some sort of major financial meltdown. My actual emergency money in the banks is about 10% of my total investments and plenty to last for some time. I've pretty much stuck to 100 minus age equals stock allocations. Cash on hand as in legal tender in the house is not a lot, but I tend to use actual cash for a lot of purchase transactions. I've been thinking if things develop more it might be better to use credit cards and avoid hand-to-hand cash exchanges.
Some radio financial adviser I heard was actually deviating from the stay the course advise. He said if you are person not comfortable with things and not sleeping at night the recommendation was to lighten up on stocks. His reasoning was that a person could sell some stocks and still realize decent profits due to the bull market stock run up. Not my approach, but a thought for people heavy into stocks.
catherine
2-28-20, 10:25am
All my net worth is in real estate, as in the two roofs over my family's heads. I wonder how that will fare, especially if we are headed into another recession due to the virus or bear market.
SteveinMN
2-28-20, 11:28am
We've got about a year of living expenses sitting in our credit union and hold some more cash as part of our retirement/savings allocations; maybe 20% right now.
I've been in this game long enough to panic when the Dow Jones starts to skyrocket, rather than fall. I saw this in the Dot.com bust and in the sub-prime mess. About six months ago, with the rising stock market, I started moving our assets to a more conservative allocation. More in cash and bonds, less in stocks. When we were younger, we could easily ride out the long downturns, but not anymore. We are no longer in the accumulation phase, but the distribution phase. That makes all the difference in the world.
The market could bounce back quickly or not. Who knows. I'm just glad we are in a more conservative allocation.
I agree, Molly. I am glad you changed your allocation and have more in cash and bonds now.
We are at age where can no longer afford to lose a whole lot, no time to make it up.
I’m still up a nice amount from just 12 months ago, so no worries yet. I’ve been investing since 1980, so I’ve seen a few bumps before. I have enough in cash that I can weather a pretty big storm without a worry. I’m more worried about the socialists taking over than a virus.
If things get really bad my ammo hoard will be valuable.
Molly, I feel the same way. When everyone starts to think that one type of investment is the best thing, values jump, and money pours in, it is time to rethink. Speculators have had disastrous results on many investments.
gimmethesimplelife
2-28-20, 7:40pm
Sure is high.I see your OP here is dated last November 5th - before most of us ever heard the word coronavirus. Amazing how much things can change in the following just short of four months, no? Rob
iris lilies
2-28-20, 8:16pm
I see your OP here is dated last November 5th - before most of us ever heard the word coronavirus. Amazing how much things can change in the following just short of four months, no? Rob
Sure is low! :~)
Sure is low! :~)
Anybody else down below where they were the first of the year?? :(
iris lilies
2-28-20, 8:48pm
Anybody else down below where they were the first of the year?? :(
i don’t know. I am not going to look!
rosarugosa
2-29-20, 8:05am
i don’t know. I am not going to look!
Same here - the ostrich strategy has always served me well and no doubt has been helpful in "staying the course" during market downturns.
iris lilies
2-29-20, 1:55pm
Same here - the ostrich strategy has always served me well and no doubt has been helpful in "staying the course" during market downturns.
Me ‘n Alfred E Newman
3130
I did check to see how much we lost. I am grateful it wasn’t more..... shocked actually. Hopefully, folks will continue to buy at bargain prices!
Wow, what a ride!
Can't wait to see what happens tomorrow. It's like watching a movie.
I can sit here and imagine those that dump due to extreme fear and the positive attitude of those who are buying on the down values. We missed some of the down but hubby wanted to buy more so we got in today. It is such a gamble. We have been thru so many of these ups and downs since the mid 80s. Hard to get too excited due to all the ups and downs we have survived and it truly helps that I have a 30% cash allocation.
I'm using the ostrich strategy as well.
I'm using the ostrich strategy as well.
As long as you have carefully thought out your asset allocation according to your age and your level of risk aversion, then the ostrich strategy makes sense.
If not, then not so much.
There's a lot of panic selling now. The media is whipping people up into a frenzy. Photos of people with slumped shoulders and their faces in their hands. I've seen this so many times. The market will come back. It always does. How long, no one knows, but it always comes back.
My asset allocation is age appropriate and has been since I learned my lesson in the dot.com bust. Staying the course has served me well.
You are so right, Molly, about being in an appropriate allocation for one's stage in life. I feel for those of us who have seen retirement savings vanish over the last two weeks, knowing I don't have the earning years to build them back, and I am in the depletion stage.
I also remember the dot.com bust, and it had an impact on how I invested over the years, so I think I learned from it.
I am glad you are fine. But many will not be fine.
It might be a good time to withdraw from an IRA for a Roth Conversion!
We've all been told to buy index funds and ride everything out. Most of the time that undoubtedly makes sense. Once in a while it might not. Trying to think beyond panic to opportunity I spent a few minutes this afternoon looking at specific stocks. My noteworthy findings: Despite the bad day Wall Street had Clorox was up today. Labcorp and Quest Diagnostics were down, but much less than the market as a whole. All three are probably a good investment. In my opinion the later two are especially good since those are the two companies that have the size and heft to step in and do all the coronavirus testing that is likely going to happen. I'll be surprised if multiple state health departments haven't already been in contact with them about their services. And shockingly they haven't exploded in value recently. Since I am pretty heavy in cash at this point I placed modest orders for both today with my non-tax-advantaged etrade account. If my guess about their future profitability is wrong then maybe I'll lose a few bucks. These are solid companies that are at worst likely to fall about as much as every other publicly traded company. On the other hand a couple of quarterly earnings statements with outsized growth and I will likely be quite pleased.
Undoubtedly there are other companies that will do well in the current crazy environment. Remote desktop providers, like Citrix*, for example, will surely do well if the "everyone needs to work from home" thing becomes reality.
*another company that was only down modestly today and is overall not exploding in value recently
I want to know what Warren Buffett is doing with the enormous cash that Berkshire Hathaway has on hand.
We've all been told to buy index funds and ride everything out....
I haven't been inspired to dig into things much as it's pretty much a changing situation, but I have wondered if some of the broad market index funds have actually fared worse than average since they are probably heavily weighted in Apple, Exxon, Boeing, and other companies that may be taken a bigger hit. I did hear that both Labcorp and Quest were developing their own test kits for covid-19. My days of stock picking are over, but I sometimes think it would be fun to speculate with a smaller amount. There are probably a few bargains right now that could benefit from the health crisis.
I did a review with a Fidelity adviser late last year and they thought I was light in international funds and light in equities in general. Their thinking was that a 60/40 equity to fixed was age appropriate. I've always been conservative and fortunately stuck with a less risky mix. I don't think the young advisers I spoke with had a good memory of the financial meltdown. There may come a time when I would like to rebalance back into equities, but I think that time may be months out.
I haven't been inspired to dig into things much as it's pretty much a changing situation, but I have wondered if some of the broad market index funds have actually fared worse than average since they are probably heavily weighted in Apple, Exxon, Boeing, and other companies that may be taken a bigger hit. I did hear that both Labcorp and Quest were developing their own test kits for covid-19. My days of stock picking are over, but I sometimes think it would be fun to speculate with a smaller amount. There are probably a few bargains right now that could benefit from the health crisis.
I did a review with a Fidelity adviser late last year and they thought I was light in international funds and light in equities in general. Their thinking was that a 60/40 equity to fixed was age appropriate. I've always been conservative and fortunately stuck with a less risky mix. I don't think the young advisers I spoke with had a good memory of the financial meltdown. There may come a time when I would like to rebalance back into equities, but I think that time may be months out.
I hear you about being glad that you are in a less risky mix. I think it is important to understand's one's own situation and allocate accordingly!
SteveinMN
3-10-20, 11:31am
I want to know what Warren Buffett is doing with the enormous cash that Berkshire Hathaway has on hand.
Pretty much staying the course (https://economictimes.indiatimes.com/markets/stocks/news/warren-buffett-calls-coronavirus-outbreak-scary-stuff-but-says-he-wont-be-selling-stocks/articleshow/74294057.cms)... maybe buying some stocks if they go cheaper.
I'm glad we rebalanced when we did. We're about 60/40 in stocks and fixed income. DW has a pension and we annuitized some of our savings. We've got a year of emergency funding if we choose to wait on pulling money from stock funds -- and that's if stocks don't recover sooner than that. DW still plans to retire in about two months regardless. A prolonged down period may prod her to work on her consulting business sooner. But it may not. Right now the answer everyone is looking for still is "D. Not enough information at this time."
I just checked, I’m at 52% stocks as of yesterday. I like to keep my allocation at 55%. A few months ago I sold some as I was at 60%, if it gets down to 50% I will rebalance again. It might not take long.
Does anyone see a need for cash literally "on hand" - tucked under the mattress, in other words? I usually don't keep cash in the house beyond my wallet but wondering if it would be a sensible safeguard. Too prepper?
Does anyone see a need for cash literally "on hand" - tucked under the mattress, in other words? We keep a few hundred in the house (mostly 20s) just in case there's a service disruption or the debit card fails and we have to wait for a new one to arrive. Our credit union has a branch just two miles down the road so it's more of a convenience factor than "prepping".
I was raised by a mom who always kept cash on hand, and we actually did use it in an emergency, and I think it's a sound practice.
I think with various disruptions being caused by the coronavirus, it's a good idea.
I have a little metal Lifesaver toy train engine that with secret stash places, where I keep a few hundred. My 5 year old grandson found it one day and dubbed it The Money Train. It has "left the station" and "carried me over" on more than one occasion.
That's so cute, the money train! We had a joke when my kids were in high school--one day my boss's son called and said he had spent the emergency money on ordering pizza. Our household joke was, "pizza is not an emergency!"
I have employed mine on occasion--just sent a hundred of it for groceries to my son who broke his arm and could not work after surgery.
ToomuchStuff
3-11-20, 10:36am
Does anyone see a need for cash literally "on hand" - tucked under the mattress, in other words? I usually don't keep cash in the house beyond my wallet but wondering if it would be a sensible safeguard. Too prepper?
Remember Hurricane Sandy?
A friend lived in affected area, where they lost power. Plastic payments were not able to be taken and sales of stuff that would go bad, was still happening. He was one of very few regulars who kept a stash of cash and was prepared for it.
If we have bad weather coming, I sometimes keep extra on hand, as I have lived through some ice storms, where getting out may be hampered as well as loss of power, etc.
Teacher Terry
3-11-20, 11:45am
We keep a couple of hundred at home.
I don't foresee any immediate need for cash because of the virus, but it's probably a good idea to have a little on hand as part of a general emergency kit. I use cash for gas and restaurant purchases because of some sort of real or imagined issue around skimming and identity theft, so always have some in the house.
rosarugosa
3-11-20, 6:11pm
I keep a small cash stash at home as well. It's come in handy several times, as a convenience, not for an actual emergency.
We've pretty much gone cashless in our every day lives so we just keep a few 20's in the kitchen for those emergency girl scout cookie purchases and we both keep a 100 dollar bill in our wallets for that as yet unrealized time when plastic won't work when we're out and about. Other than that, I don't feel the need for an emergency stash.
frugal-one
3-11-20, 10:54pm
Guess I am the odd man out... We have a few thousand around (in small bills).... just in case.
We have 2 years expense in a cash account. It's doing OK at only 12.5% loss right now.
Locally we keep 6w expenses for immediate access.
Starting tommorow to rebalance a little. Buying S&P 500 mutual fund. Just nibbling for now.
We have 2 years expense in a cash account. It's doing OK at only 12.5% loss right now.
Locally we keep 6w expenses for immediate access.
You lost 12.5% in cash?
You lost 12.5% in cash?
It's our cash fund in our investment accounts rather than our market/IRA/Roth
But how could it have lost 12.5%? Did you have it in an index fund, as "cash" for future needs? I'm confused, too.
It's our cash fund in our investment accounts rather than our market/IRA/Roth
So it wasn’t invested in cash instruments like t-bills, commercial paper or repos, like you would see in a money market fund?
So it wasn’t invested in cash instruments like t-bills, commercial paper or repos, like you would see in a money market fund?
Correct. I am not worried. We have sufficient resources. We live just fine on our take-home and can let our reserves alone. All of the "majors" in our lives are within 5y of age except hubsters' vehicle so the urgent needs that money is banked for are years away.
How many times have we all been down and up with the market in our lives? If I got worried I could easily run over to the bank for $4k to tuck under my pillow:)
ApatheticNoMore
3-12-20, 2:36pm
I save 2 years in cash for a possible 2 year long unemployment anyway. I consider this basic realism about how the modern economy works (not just now in the corona collapse, but always).
I noticed today that the fed is injecting 1.5 trillion into the bond market. My basic understanding of national debt history is that Obama pushed it it up pretty good with his TARP and bail out programs and Donald added to it with his tax cuts and expanded spending. And there's another possible tax cut mentioned. I just wonder how much more the ceiling of debt can be pushed before something breaks. It seems like the economy is getting rather fragile?
Starting tommorow to rebalance a little. Buying S&P 500 mutual fund. Just nibbling for now.How'd That go?
I noticed today that the fed is injecting 1.5 trillion into the bond market. My basic understanding of national debt history is that Obama pushed it it up pretty good with his TARP and bail out programs and Donald added to it with his tax cuts and expanded spending. And there's another possible tax cut mentioned. I just wonder how much more the ceiling of debt can be pushed before something breaks. It seems like the economy is getting rather fragile? I think so. They're trying to fix two situational bears (oil fiasco and corona virus) using fixes designed for a structural bear (bubble); fixes that have been overused and stretched too thin for too long just to keep the good times rolling instead of allowing for some natural adjustment. The bear is now coming home to roost, so to speak.
https://encrypted-tbn0.gstatic.com/images?q=tbn%3AANd9GcQgmThCcja1wwH44UQ-UmzfSpRembofZa0Xjo6vU7qeAlKnsA07
How'd That go?
I put in a buy during the day, I’m never sure what price I pay till the order post. It’s with Vanguard in a mutual fund. It was only 1% of my holdings. I’ll add again a drip at a time.
I put in a buy during the day, I’m never sure what price I pay till the order post. It’s with Vanguard in a mutual fund. It was only 1% of my holdings. I’ll add again a drip at a time. Ah, good luck. I'm dealing with dividend stocks and buying the tiniest nibbles. I have a set return threshold I'm looking for, so I'm not completely aggrieved if the stock goes down more after I buy it, but still, a dollar not spent is a dollar saved.
I am considering a massive IRA to Roth conversion. Buy a ton now, earn tax free ongoing. Unless of course "The Donald" decides to tax that to make up for all his tax breaks.
My pension plan finally offered up a whopper of a deal earlier this year, after years of insulting offers that were no reflection at all of the ever-surging market. I got my paperwork in on time, knock on wood, so I'll be sitting on cash that will get invested and then converted. I trust my picks to recover, so if the market's still going down I'll reap the reward of less 'income' to declare as I shift it over, if the market's going up that's just good, period.
My pension plan finally offered up a whopper of a deal earlier this year, after years of insulting offers that were no reflection at all of the ever-surging market. I got my paperwork in on time, knock on wood, so I'll be sitting on cash that will get invested and then converted. I trust my picks to recover, so if the market's still going down I'll reap the reward of less 'income' to declare as I shift it over, if the market's going up that's just good, period.
Pension plan buyouts are really a good deal if one thinks they will live a long time. Best offer I ever got equaled less than 5y of accumlated monthly payments. Since my lineage projects I'l exceed 90y? That's a pittance.
Pension plan buyouts are really a good deal if one thinks they will live a long time. Best offer I ever got equaled less than 5y of accumlated monthly payments. Since my lineage projects I'l exceed 90y? That's a pittance.This was piddling along and suddenly they offered about 30% more than the last quarter, close to 11 years of payments - I think they're really pushing for people to self manage and get out of their contract. The amount they offered is enough that if I invest it properly til the day they would have started paying me, I should be able to match or beat the payout they would have been giving me without drawing down the principal, as well as having the freedom to convert this to a Roth along the way. Not to mention I'll never have to deal with these people again in my life, which might make it worth it even if I don't quite succeed. it wasn't a very big pension but I'm pleased to get it at all, as I say, the only promise I trust is my own, so ... fingers crossed the check's in the mail. - I really like the timing, I'm out at market peak even though that just went galloping out of sight.
Ah, good luck. I'm dealing with dividend stocks and buying the tiniest nibbles. I have a set return threshold I'm looking for, so I'm not completely aggrieved if the stock goes down more after I buy it, but still, a dollar not spent is a dollar saved.
I’m in at yesterday’s closing price, so that’s better than the opening.
It seems to me the media is whipping people up into a frenzy. We are in a health crisis right now, so yes it's going to affect the market, but it is temporary. It doesn't feel like the sub-prime market crash. That felt like it was going to last a long time and it did. This feels much shorter. I know I'm going a lot on feelings, but I've been in this game for a long time and have seen the ups and downs. The market will come back as it always does, but no one knows when it will reach the 29,551 high from February. Many people felt the market was overvalued and due for a correction. So it may bounce back, but may take awhile to reach that high again.
Does anyone else have gut feelings about the market? I'd love to hear them.
The market is definitely affected by emotion. Personally I’d have a lot more confidence in a speedy recovery if the president, on Wednesday, had given the speech Biden gave on Thursday. That said, I’ll be holding everything until it recovers.
My thought: The big unknown is how long CV is going to have a major impact. If it's a fast blow-out and we're all back to life as usual in three weeks, the machine will just bounce back from a bunch of panic selling followed up by a bunch of opportunistic buying. However, if it goes on long enough that the business balance sheets are actually affected significantly, that could take the rest of the year to heal. While I don't blame Trump for the virus itself - he's about as xenophobic as they get and probably would have loved to build a lucite dome around the entire country - I do think if our gearless leader had been more proactive he could have averted the financial chaos he's so afraid of.
SteveinMN
3-13-20, 10:26pm
The market will come back as it always does, but no one knows when it will reach the 29,551 high from February. Many people felt the market was overvalued and due for a correction. So it may bounce back, but may take awhile to reach that high again.
Does anyone else have gut feelings about the market? I'd love to hear them.
I think the market was a little overheated and the reaction to COVID-19 took that into account -- and then some. It's pretty much irrational -- but, then, so many of these same investors are trying to corner the market on toilet paper and bottled water, neither of which figure prominently in treating COVID-19. There's plenty of irrationality to go around.
I think this thing will have some very long tentacles. Certainly there is the physical cost of illness and death and the possible overwhelm faced by the health care industry. If Americans don't help flatten the curve of incidence, there likely will be no way to treat all those who need treatment and the many more who would not have caught COVID-19 had screening/testing and concepts like social distancing not been pooh-poohed by stable geniuses and the significant number of Americans who do not believe in herd immunization.
Millions of dollars are being lost with sports teams not playing, theaters closing, and travel destinations keeping the gates closed. That also means no plane flights to and from those attractions, no hotel rooms, no restaurants,...
The big ripple will be felt by the poorest workers -- the ones who don't get paid to self-quarantine or who can work from home on a company-supplied computer -- the ones who don't get called in to work (and, therefore, paid) because empty hotel rooms don't need cleaning, because no one is at the concession stands at empty arenas and theaters, because there are no meals to cook for airplanes which are not taking off, because there are no customers at tables to wait on, because there's no need to manage a camera at ESPN if there are no sports to broadcast. The people who are not getting paid aren't going to be buying new TVs or cars or signing up for Caribbean cruises when the virus is subdued. Nor are the folks who will have to take unpaid leave to care for sick family members and/or kids who are home for weeks from closed schools.
For an economy that relies very heavily on consumer spending, having consumers holed up in their houses for weeks on end (it will be weeks, not just a couple-three) will be deadly itself. This will show up in quarterly earnings, which will dampen the spirits of investors and hurt the retirement savings of those lucky enough to be able to invest for retirements or for splurges like vacation homes or nicer vehicles -- or bequests to charitable organizations now sitting on far less value (and maybe receiving less in the future because the market took it out of so many peoples' retirement funds).
I don't mean to sound apocalyptic. I think the market will largely recover in 12-18 months because, some overheating aside, it was fairly sound. But it's going to hurt many, many organizations in earnings and/or human capital for a few years to come (at least).
Steve, I agree. I also don't want to sound doom and gloom, but the impact of the virus will have less to do with the virus itself and more to do with the shattering of income for so many. If this is sustained, what's going to happen to all those people who don't have 6 months of emergency funds? How do people make that up? How do kids who depend on school lunch programs get fed? How do businesses readjust for all the tourism lost in their cities? This feels like it has the potential to be the Great Depression, redux.
Steve, I agree. I also don't want to sound doom and gloom, but the impact of the virus will have less to do with the virus itself and more to do with the shattering of income for so many. If this is sustained, what's going to happen to all those people who don't have 6 months of emergency funds? How do people make that up? How do kids who depend on school lunch programs get fed? How do businesses readjust for all the tourism lost in their cities? This feels like it has the potential to be the Great Depression, redux.
Catherine and Steve, these are my thoughts, too. The human costs are going to be enormous. We are already seeing individual announcements--my son's friend who works as a nurse at Bowdoin is on "unpaid forlough," for example, as none of those students are returning for the rest of the year. This is an example of a "good" job, a "stable" job, and upends the idea that if you just have a good job that requires education, you will be fine. Everything is interconnected these days. The folks that work at the library in my town are not getting paid for these five weeks, minimum, that started yesterday for them, with absolutely no notice.
Molly, you asked about the market--I hope I am wrong, but I think those people buying on the dip have not begun to see the dip yet. How can you possibly have this kind of disruption in everyday life and activities and not have profound economic costs, let alone the human costs in terms of the human psyche?
Anyway, with respect to the market, I hope I am wrong.
SteveinMN
3-14-20, 10:50am
This situation is shifting very rapidly.
Since I posted (about 12 hours ago) (!) I've seen news reports that some athletes and a few team and venue owners will be donating money to hourly workers associated with the teams and venues. Now, many times the report/news release states they "will be assisting employees" (emphasis mine), indicating to me that there will be some money paid but it will not fully replace typical earnings. And it doesn't help bars, restaurants, or rideshare drivers who are losing out because there are no customers before and after events. But it's better than just cutting these folks loose.
I've seen a few local restaurants offering takeout or drive-up service (new to them) rather than just leaving the rooms and kitchens empty. I don't yet know how (or if) money will be shared with front-of-house workers who won't be busy beyond ferrying food out to the front door. But it's an unusual (for those restaurants) approach to keeping the doors open at least a little while longer.
Second Harvest Heartland is making available Emergency Food Boxes which can be given to those who need them without much physical presence. Drive up, be handed a box, be on your way.
The Governor of the State of Minnesota has declared an emergency that comes pretty close to banning gatherings of 250 people or more -- or much smaller gatherings if people must be within three to six feet of each other or the gathering includes a significant number of "people at risk" (older, chronic disease, etc.) Schools still are open, but I suspect that is largely a logistical issue giving parents time to set up work from home (if possible) or arrange for child care, meals, etc., and that the guideline will change in the next month or two. The guidelines (not yet law but they could become law) pretty much cancel our April dance (if not our May dance; then we're off for the summer). Several other dance groups have cancelled this weekend's dances, but many did so because their dancing location (school, church, etc.) closed to outside activities. That may have happened at the church at which we dance, but I haven't checked on that yet (or they haven't made that decision yet).
The Dow was up almost 2000 points Friday. That's a bit of a clawback. But this is now a bear market. I agree with Tybee that we have not yet seen the bottom or even close to it. That will have a ripple effect years down the road as it takes more years (or less consumer spending -- uh-oh! --and more saving) for people to achieve their savings targets (or find they have to work longer before they can retire). This is not specifically a COVID-19-related issue though I think it has been made worse because there are very few adults in the room right now.
ApatheticNoMore
3-14-20, 12:21pm
California: schools are closed, libraries are closed, gatherings of more than 250 is banned, some cities have canceled all events, concerts are being canceled, Disneyland closed, activities like book clubs moved online. Not everyone is but I'm afraid to go to restaurants, not going to coffee shops (well I only went there to hang out and read, have a drink or a sweet on weekends - but who knows maybe even the drive though SBUX close - I drink tea at home on weekdays anyway). And I debate whether to continue going to the gym or not (I'll keep the membership) but wondering how long is this going to continue, doing nothing forever? I mean I may advocate degrowth but I never considered going to the gym, or getting coffee in a MUG, or meeting with a group a huge problem.
I'm keeping going out to a minimum, to buy groceries (and I've become scared of the supermarket but I'm not subsisting on rice and beans and pasta with no fresh food, unless I have to, and I'd run out of rice and beans anyway that was for self-quarantine if I had corona not a permanent plan - not that much stuff isn't gone from the supermarkets shelves), go to work, buy gas. Leisure shopping even for clothes forget it, thrifting no way etc..
Whether to keep money in stocks and bonds for retirement, what in a few decades, what me worry? I am absolutely not in favor of it as policy, but if Trump got his stupid payroll tax, I'd invest it in the markets probably, because I think it's an excuse to cut social security and have to survive somehow, so put it all on red. The markets may recover in a decade or so, but we will have much bigger problems by then by far like climate change may make this look minor. Bosses husband works in event stuff I think and has received a layoff notice, but with noone going to restaurants or coffee shops or gyms or whatever, there will be more to come, I don't see how there can't be.
There's some good discussion here! I had a few more thoughts since reading your comments. I agree that there are going to be some long term economic effects from the COVID-19 crisis. When the market comes back, I feel it won't be as high for awhile, and perhaps not the same. I think people were over confident and complacent when the market was rising. But I kept feeling we were due for something to happen, something to shake things up. I don't know how strong our economy really is and I don't expect to get the truth from the White House. And yes, we could be facing implications from climate change very soon. I don't think there is good leadership in the White House - they would rather cover things up or bury their heads in the sand. Honestly, I felt more of a sense of panic when the stock market was rising so fast, because it felt like a house of cards.
I am just a bit worried about things like state pensions (like mine) for the long haul. So many are invested heavily in the market.
My world is so busy - long hours - cause I work in a hospital. So this weekend I’m loving it at home!
I worked a couple of 12 and 14 hour days this week. Extra meetings to be sure we are completely ready when we get our first case, lots of staff education and reassurance as we ruled out a few cases this week, etc.
Boredom at home is difficult. But my life will be the opposite I fear for the next few months ...
With a little luck this will mostly blow over in a month or two and it will be a matter of how long and if things can claw back to normal. I think as long as people don't panic and start having some bizarre social behaviors, the financial outlook is bad but not disastrous. A concern I had last week that showed up in a couple of reputable financial sources was that there was a low demand for treasuries. Usually that is the safe haven where money goes when the stock market is going down. Also precious metals, another safe haven for some were also down.
dado potato
3-16-20, 6:08pm
My world is so busy - long hours - cause I work in a hospital.
Boredom at home is difficult. But my life will be the opposite I fear for the next few months ...
I am lighting a candle and thinking of you, Tammy, and all the nurses, radiologists, physicians, PAs, and every sort of worker who is on the front-line of health service as the number of cases grows.
Teacher Terry
3-17-20, 1:56am
Tammy, it’s people like you that mean the difference between life and death for many people. Yet you also have to look out for yourselves. Sending lots of love and light for whatever you decide.
Thanks. I don’t see that I have a decision to make. I’ve often wondered I would do in a pandemic. But I’ve discovered that what I do is keep going to work because that’s the only thing that makes sense.
The situation seems to be changing by the day. Who knows as this point where the market is headed and how long it will take to recover. I don’t wish to sound doom and gloom, but what with an unknown virus, climate change deniers in the White House, more quantitative easing, a fortune being spent on foreign wars, I don’t have a lot of confidence in our government or the economy right now.
I think the best thing to do is what we here at Simple Living are doing or striving to do. Live within our means, stay out of debt, and have a solid emergency fund.
I think the best thing to do is what we here at Simple Living are doing or striving to do. Live within our means, stay out of debt, and have a solid emergency fund.
I agree, Molly. It is a good reminder of the importance of all three of those actions. Thank you!
I agree, Molly. It is a good reminder of the importance of all three of those actions. Thank you!
+2. I feel almost too calm during this whole upheaval. I feel like maybe I should be more worried, but there's not really anything to worry about. We have everything we need, and plenty of safeguards should we need more. It's a bit eerie, like maybe I'm missing something. But I can't think what that might be. Toilet paper? :confused:
Dh surmised that the whole toilet paper panic is because people are afraid, and focusing on that one thing gives them something to DO so that they won't feel so powerless and out of control. Might be true, I don't know what else would cause such a panic.
Dh surmised that the whole toilet paper panic is because people are afraid, and focusing on that one thing gives them something to DO so that they won't feel so powerless and out of control. Might be true, I don't know what else would cause such a panic.
The explanation is simple. Every time someone sneezes, ten people lose control of their bowels.
Is it possible that people of thinking of stomach flu with the runs as similar to Covid 19?
Is it possible that people of thinking of stomach flu with the runs as similar to Covid 19?
I think that's part of it. GI issues are common with the usual flu. TP definitely is not something you want to be out of if you're going through it quickly because of illness. That's why I found it so odd that people rushed the TP aisle to stock up for this.
And canned goods. It makes sense to have some non-perishables on hand at all times, but there is no expectation that the lights will go out, so refrigeration should remain available to everyone who had it before COVID-19 hit. There's no need to stockpile MREs and cans of soup unless one wants to as a general part of prepping.
frugal-one
3-17-20, 7:41pm
I think that's part of it. GI issues are common with the usual flu. TP definitely is not something you want to be out of if you're going through it quickly because of illness. That's why I found it so odd that people rushed the TP aisle to stock up for this.
And canned goods. It makes sense to have some non-perishables on hand at all times, but there is no expectation that the lights will go out, so refrigeration should remain available to everyone who had it before COVID-19 hit. There's no need to stockpile MREs and cans of soup unless one wants to as a general part of prepping.
Could be people think that if they are ill they won’t want to cook. So are looking for convenience?
frugal-one
3-17-20, 7:42pm
The explanation is simple. Every time someone sneezes, ten people lose control of their bowels.
Thanks for the laugh? :laff:
SteveinMN
3-17-20, 11:06pm
Could be people think that if they are ill they won’t want to cook. So are looking for convenience?
I'm sure that's part of it, too. But there are frozen prepared meals, too, and they don't seem to get the press that the canned goods got (at least as far as I've seen/heard).
I think that so often power outages seem to come with such natural disasters that people are just buying what they usually buy for emergencies. Our stores are out of bread, milk, rice, flour, oatmeal--it occurred to me looking at the empty shelves that people around here really know how to stock up and have a game plan for loss of power, which actually allays some of my fears for my community--we seem to have prepared well, given what is missing.
This morning our power went out, but they had scheduled the outage earlier, so I guess they decided to go ahead with it, which is too bad. It is also snowing, so we are not in spring mode yet, and people have to think about staying warm.
Back to the Dow--did another circuit breaker get triggered this morning? We had no power so I could not see if so.
Kib: I think 6 months is a reasonable and even optimistic guess. A reliable vaccine must be in place for people to be able to safely congregate -- and not just in place, but manufactured, rolled out, and people inoculated -- that's a huge process, it will take months.
We bought a lot of canned soup and canned vegetables (yuk, but in a pinch they'll do) because even in good times it is hard for us to keep fresh produce living so far from the city. Our little general store has a few fresh items, like carrots, avocados and potatoes but you never know when they are stocked up or if its even fresh once they do have them. I am hoping that during this time they will commit to stocking more variety so people don't have to drive all the way to Santa Fe to get essentials. WE are at the point that we won't go into any enclosed public places anymore because of K's high-risk status.
At the peak of this, finding repair people might be difficult, so it's not wrong to consider power outages, equipment failures, etc. when planning.
Starting to see pleas for toilet paper on Nextdoor from people who are elderly or sick. I recall helping a friend clear out an estate when I first moved here. The basement had a whole wall of toilet paper and paper towels, another of canned foods, light bulbs etc. We learned that the owner had stocked up for Y2K and that stuff was still sitting there 20 years later. I think as he grew old he was not able to go downstairs and had no friends or family.
frugal-one
3-21-20, 5:40pm
Looked at portfolio today. All gains from when trump came into office are gone! Not sure what to do. Just quit looking, I guess. Makes my stomach churn.
rosarugosa
3-21-20, 7:13pm
Looked at portfolio today. All gains from when trump came into office are gone! Not sure what to do. Just quit looking, I guess. Makes my stomach churn.
I haven't looked since January and I may not look again until next January. Ostrich strategy has served me well so far.
I haven't looked since January and I may not look again until next January. Ostrich strategy has served me well so far.I finally looked the other day and was relieved to only be down several hundred thousand, I thought it might have been more. I'll look again in mid-summer in hopes that we'll be on our way back to where we were.
I finally looked the other day and was relieved to only be down several hundred thousand, I thought it might have been more. I'll look again in mid-summer in hopes that we'll be on our way back to where we were.
Ditto. I only draw $1000/month to add to our budget so I'm not going to worry about it. I pay someone else to worry about it:~) he is worth every penny too!
Yeah, all my stocks have tanked except for the few shares I have in a cannabis company. Go figure.
I rebalance back to 60/40 at the end of the quarter. It’s been said that these are the sort of period where most of the money gets made, even if it doesn’t feel like it at the time.
I’m a firm believer in the salutary ignorance of day to day market movements. It’s a bit difficult in extreme cases like now, but I try to heed the advice to be greedy when others are fearful.
catherine
3-22-20, 11:24am
I’m a firm believer in the salutary ignorance of day to day market movements. It’s a bit difficult in extreme cases like now, but I try to heed the advice to be greedy when others are fearful.
It's true that our American/capitalist culture has turned greed from being one of the 7 deadly sins into being a virtue, but "buy low" is not a definition of greed IMHO.
iris lilies
3-22-20, 11:38am
I finally looked the other day and was relieved to only be down several hundred thousand, I thought it might have been more. I'll look again in mid-summer in hopes that we'll be on our way back to where we were.Yes, that’s me too. I avoided this thread for a week or more. I removed the Stocks App from my iPad because I don’t want to know the value of the Dow. I turned off the radio because they’re always yapping about Market plunges. that. Yet somehow I saw the number. I don’t look at our own valuations because I have no reason to think it is better or worse.But if only if it’s only a few hundred thousand down, that’s not a big deal, I can live with that.
It's true that our American/capitalist culture has turned greed from being one of the 7 deadly sins into being a virtue, but "buy low" is not a definition of greed IMHO.
Well, I suppose you could buy low with no intention of sullying yourself with sinful profit, but what would be the point of that?
frugal-one
3-22-20, 3:15pm
If it would only stay at a few hundred thousand down, I could live with it.... BUT with all businesses closing and no end of that in sight, I cannot see losing any more. I had too much in the market, so I tapped out some of my roth. I will sleep better. If we lose the rest of it, we still will have enough to live for the rest of our lives. In this case, we have enough. I guess you have to decide what is enough for you both in losses and money in hand.
Well, I suppose you could buy low with no intention of sullying yourself with sinful profit, but what would be the point of that?
Last night DH and DS decided on the movie of the night: Dark Waters. It's about how Dow Chemical intentionally poisoned a whole town so earnings on Teflon would not be impacted. That is greed in the name of profit. Phillip Morris intentionally withheld information about the dangers of smoking for decades until they were exposed by the media. That is greed in the name of profit.
I'm not a theologian nor an ethicist, but IMHO, a retired accountant looking to bolster his savings by buying low during an economic slump is not in the same category. I absolve you (sarcasm intended). ;)
ApatheticNoMore
3-22-20, 3:41pm
Buying the market now is maybe one of those get rich or go broke things (and maybe only so rich even so). Well let's hope it's get rich then :)
By the by, I don't need to do either, I'm just doing as we're supposed to to have a retirement, regular contributions, even if it never materializes, well that was a possibility all along.
If I were a stock picker Amazon or Netflix might tempt me into a few dollars of investment. I suspect they are both overpriced. My risk tolerance is not up to any additional investments now, but it seems like there could be some market beaters aside from biotech, which I suppose are popular right.
I have little faith in my (or anyone else’s) ability to consistently time markets or pick stocks, so I maintain a static allocation in index funds that I rebalance to quarterly. That way I’m generally buying stocks when they’re out of favor and selling when they’re in favor. I keep a separate emergency reserve in cash and short term government issues, and our daily expenses come from a pension, annuities and a bond ladder, so I’m fairly certain I’m only risking capital I can afford to risk.
It’s boring, but relatively safe. When people claim to have “ seen it coming” or to have sold at the perfect time, I can at least say that while no plan is bullet proof, my approach limits risk and is relatively cheap and easy to operate.
I keep a separate emergency reserve in cash and short term government issues, and our daily expenses come from a pension, annuities and a bond ladder, so I’m fairly certain I’m only risking capital I can afford to risk.
I think this is an important distinction with this particular market.
I could get a little nervous about what would normally be called safe havens. I suppose the fed will just print up money to cover the remote possibility of a treasuries default and insured savings with illiquid banks. I could see municipal bonds taking a hit but the fed might bail them out depending. I'm less sure about investment class bonds. Maybe the government will come to the rescue if airlines or big oil get into trouble, but during the last financial crisis bailouts were not popular among all. Then there's the "high yield" bonds. A small part of my portfolio is a high yield bond fund. I think the bonds are pretty much in the junk category and I could have some concerns there.
Other than grandma's sterling I don't own precious metals, but that safe haven or contrarian asset class has been taking a hit.
When people claim to have “ seen it coming” or to have sold at the perfect time, I can at least say that while no plan is bullet proof, my approach limits risk and is relatively cheap and easy to operate.
My experience is that those folks may have caught the lightning bolt once but they won't do it a second time (on the way back up or down; whichever way the market is headed).
A small part of my portfolio is a high yield bond fund. I think the bonds are pretty much in the junk category
"High yield" is a euphemism for "junk". Kind of how they've changed the names for grades of meat. I have some of those, too, a very minor part of our portfolio. They can provide some nice upside potential but I would never predicate my financial future on them.
Still waiting for the bottom of this market. I believe there will be at least a 50% drop in the Dow (not far from that now) before things level off. In the meantime, if Congress can agree on a "rescue" plan, I think the market will go up one or two thousand points on the day that's announced -- and then the market will go down again once people have had a chance to figure out what the plan covers and doesn't cover. There will be a bump the day a treatment or vaccine is announced by some university or clinic (not by Dr. Trump in the briefing room). And more drops as the death toll increases. There's nothing settled about this market yet. But if you're still in it, you ought to stay in it.
I read somewhere that the best investor is the lazy investor. One who does dollar cost averaging and only looks at his or her portfolio occasionally. One that does not panic but stays the course.
I took a glance at our portfolio last week, then closed out and vowed to not look at it again until this crisis is over and the market settles down. We moved into a more conservative portfolio last spring because we are entering the distribution stage in the next year or two. So the loss was not as bad as it could have been if we had kept the original allocation. But of course a loss is not really a loss unless you cash out.
BTW, we are in index funds and the rebalancing is done for us at Schwab. So our account is on automatic pilot.
We are fortunate that I have a pension, my husband has social security and we have a couple of annuities. So we are going to sit tight, stay frugal and ride this out.
I had sold some stuff before all this, not because I'm a market timing genius, but because I was in the process of rebalancing and didn't quite finish... Now, between having a whole bunch of cash that I'll be reinvesting into index funds once things calm down a bit, and the fact that I'm still aggressively saving, but buying at lower and lower prices, I'm reasonably confident that if I can keep working another 10 years I should be fine.
I rebalanced a little back in February, sold some stock. I rebalanced again a week or so ago, bought some stock. If it keeps dropping I may have to rebalance again. I like it better when I’m selling stock.
We should all be holding off on that rebalancing. The Texas Lt. Governor has a plan for saving the economy. Admittedly it’s a bit of an odd plan for someone from the party of ‘family values’ but heck, desperate times (and what could be more desperate than a falling stock market) call for desperate measures.
We should all be holding off on that rebalancing. The Texas Lt. Governor has a plan for saving the economy. Admittedly it’s a bit of an odd plan for someone from the party of ‘family values’ but heck, desperate times (and what could be more desperate than a falling stock market) call for desperate measures.
As a grandparent myself, I think I understand where he is coming from. I think he is saying he would sacrifice himself for them to have a normal life. That is different than saying what could be more desperate than a falling stock market.
As far as I'm concerned, all those oligarchs who want me and others to die to save the bloody stock market (like that's a solution) can go first. But they're not keen on dying themselves, their advice is for the rabble, the "47%." #NotDyingForWallStreet
As a grandparent myself, I think I understand where he is coming from. I think he is saying he would sacrifice himself for them to have a normal life. That is different than saying what could be more desperate than a falling stock market.
Personally I don’t want to die for the Dow. And wouldn’t want any of my older friends and family to do so.
And at the end of the day it’s just a stupid idea like so many republican ideas. If we stop socially isolating it’s not like just old people will be affected.*. Lots of worker age people will also get sick and have to take time off/drop dead and ultimately the economy will be worse off than it would be if we as a society act like mature adults and do our best to slow the spread of this disease.
*let’s look at liberty university about 3 weeks from now to see how the republican stupidity of ‘pretend like this isn’t a big deal’ plays out.
JP, I never said I wanted to die for the Dow or that anyone else should, either. Please do not mischaracterize what I said.
It's reported that South Korea--a country that took this pandemic seriously--is almost back to normal. Their economy will probably rebound quickly. Our foot-dragging, denial, and misdirection won't serve us well. Listening to Governor Cuomo having to beg for medical equipment is chilling, as is Trump's reply--basically "Get it yourself; it's not my responsibility." Disgraceful.
I read somewhere that the best investor is the lazy investor. One who does dollar cost averaging and only looks at his or her portfolio occasionally. One that does not panic but stays the course.
.
There’s a great web site called “The Oblivious Investor”.
To me, it’s one of those “never assume you’re the smartest guy in the room” things.
The Texas Lt. Governor has a plan for saving the economy.
Sure. They would love to see the number of people on Social Security and Medicare reduced. People who they consider a drain on the system.
And Trump, his family and all the other oligarchs will never have any trouble getting access to a ventilator. Just the rabble who they consider expendable.
I was over on the Money Mustache site this morning and people over there are talking about taking money out of their home equity to invest in the stock market. I confess that I've had the thought a few times myself. We have a ton of equity in our house and interest rates are so low right now. After the '08 recession, we were kind of kicking ourselves for not buying property as home prices were reduced by about 50% in our area and quickly rebounded and are now at all time highs, about $700 per square foot. My next door neighbors bought their house for $270k in Dec 2009 and it's now worth about $900k, maybe more.
And I'm thinking, gosh are we going to be kicking ourselves for not buying stock right now? Anyone else thinking about it?
Teacher Terry
4-5-20, 4:53pm
I wouldn't be taking equity out of my house to do it.
I suggest everyone listen to the latest several Bill Gates interviews. Sobering. I would not be chasing $$.
I’m Selling and buying a house next week, at least that’s the plan. I originally planned on paying cash for the new house, but now I’m going to finance 80%. With rates at 3% for a 30 year loan I figure I’d rather have the cash available. I can always pay it off later, or let the kids worry about it when I’m gone. At 62 I’m pretty sure I don’t have 30 years left.
And some of that money will be put into investments of some sort.
ToomuchStuff
4-6-20, 3:59am
A friend once tried to get me to mortgage my house to invest in a video game that he and the kid from Malcolm in the middle had invested in. I don't see my home as a speculative investing tool. Turned out I was correct, as the franchising parent company, yanked the Stargate license, which killed the project. Friend lost something like $75K, while that actor lost more then six figures.
The stock market can go down, as well. Also, if this pandemic because worse and the death predictions were really low, it is conceivable that we could end up with a surplus of houses, where value would fall.
Why not just start investing with the same amount as a mortgage payment?
By getting the mortgage it makes the money available for one thing. I won’t be putting the total amount in the stock market at once. And if I need the money in the future, it’s unlikely that I would be able to borrow at this rate. We are at record lows.
I may use some of the money to by a rental. I live in a area that is very desirable for seasonal rentals and second homes. Many of these may be hard hit by owners that are not currently being able to rent, coupled with job losses. But once this is over, people will continue to want to rent when this is over.
Or i may just go ahead and pay the mortgage off if things change, it won’t cost me that much if I change my mind.
Also the new home is not where most of my net worth is at this time. If it was paid for it would still represent 10%-15%.
And I'm thinking, gosh are we going to be kicking ourselves for not buying stock right now? Anyone else thinking about it?
Buying stock with dollar cost averaging? Sure (we are). Tax loss harvesting or culling the duds from a portfolio? Okay (that, too). Going all in enough to put a lien on our home? No way.
Even though I think the market will have a relatively quick comeback, the market is not the entire economy. The money the Republicans said didn't exist for the social programs and corporate welfare they're now funding has to come from somewhere. All those postponed payments have to figure into a balance sheet sometime. And while the virus has yet to peak in the U.S., it is only now hitting countries on other continents, many of which will not be able to clamp down on it even as poorly as the U.S. did. The world economy will be unsettled for quite some time to come. Bet on it with money? Yes, because in the long run I think it will work out for the better (always has so far). Borrow money to go in (or in deeper)? Not for me.
My sister recently told me that our father borrowed money to buy gold and gold stocks at the start of the big run up on it back in the early 80’s. That was the only time he used margin for any investment. And also the only time in his life that he didn’t sleep well.
I don’t see holding cash as a decision to stay out of the market. I see it as a decision to participate in a different market. I certainly agree that the creation of so much more money in the short term will have negative consequences in the long term.
I’m thinking second homes may drop in price. I’d like to pick up a small condo or house down in the Florida Keys, or maybe something local for a rental.
I’m thinking second homes may drop in price. I’d like to pick up a small condo or house down in the Florida Keys, or maybe something local for a rental.
I agree with you and think that sounds like a good plan.
Well the market is not doing that bad, with my rebalancing I’ll need to sell some stock soon due to gains. Will be my third time this year. I’m still down YTD, but not much, and I’m up looking back 12 months.
and so far the real estate has been fairly steady here. Not sure about the keys yet as they are still not open. I would think they would be taking a pounding, but all those northerners keep buying.
I agree with you and think that sounds like a good plan.
In New England, real estate for second homes is blowing up (maybe not blowing up, exactly) because a lot of New Yorkers are anticipating another COVID surge and don't want to be trapped in NYC again.
https://r-login.wordpress.com/remote-login.php?action=auth&host=nypost.com&id=56757169&back=https%3A%2F%2Fnypost.com%2F2020%2F05%2F20%2Fc oronavirus-tidal-wave-causes-connecticut-real-estate-frenzy%2F%3Ffbclid%3DIwAR1rSuVyiH7EREKZZ5fPzNj_Pf4 4PFoHLhIkDSWC3XUL11J_c3IxKuc-yuA&h=
Teacher Terry
5-28-20, 12:37am
The link wouldn’t work. I am curious.
The link wouldn’t work. I am curious.
Try this one:
https://nypost.com/2020/05/20/coronavirus-tidal-wave-causes-connecticut-real-estate-frenzy/?utm_source=url_sitebuttons&utm_medium=site%20buttons&utm_campaign=site%20buttons
Try this one:
https://nypost.com/2020/05/20/coronavirus-tidal-wave-causes-connecticut-real-estate-frenzy/?utm_source=url_sitebuttons&utm_medium=site%20buttons&utm_campaign=site%20buttons
That works!
Interesting. I guess the Maine market is going to get even worse, except people are angry that Maine won't let them come up without the 14 day quarantine right now.
Teacher Terry
5-28-20, 12:53pm
Thanks Catherine. That worked.
iris lilies
5-28-20, 1:15pm
That works!
Interesting. I guess the Maine market is going to get even worse, except people are angry that Maine won't let them come up without the 14 day quarantine right now.
How are the states keeping people out?
In St. Louis we border Illinois. Missouri is now open and Illinois closeD down but people have to travel back-and-forth between work. Somehow I doubt Illinois blocking the bridges to keep people out.
How are the states keeping people out?
In St. Louis we border Illinois. Missouri is now open and Illinois closeD down but people have to travel back-and-forth between work. Somehow I doubt Illinois blocking the bridges to keep people out.
Maine has closed the motels. They are supposed to open June 1 but supposedly only to people who have completed the 14 day quarantine. You are supposed to enter Maine and stay in your quarantine house indoors with no trips to grocery etc.
Supposedly people are cancelling trips to obey the law or are breaking the law. It is punishable by 1000 fine and six months in jail.
Teacher Terry
5-28-20, 1:35pm
South Lake Tahoe gives each person a thousand dollar fine if your driver’s license doesn’t have a local address.
iris lilies
5-28-20, 1:45pm
Well, all that seems draconian, but as I am a states rights advocate I support the states in doing whatever they choose to do within reason.
I just read in the Portland paper that next week they reopen the Maine Trolley Museum, but to Mainers only.
That's the kind of thing that seems dumb to me.
I think I’m back to even ytd. I rebalanced back when the market was higher, and bought back in when it was lower. I did not sell at the high or buy back at the low, but close enough. If it goes much higher I’ll have to sell some again to keep my asset allocation where I want it.
im still up nicely over the last 3 years.
Guess I should have keep more, and I’m now up ytd. I’m a little over 50% stocks now, ill just leave it there for now. I still don’t see how the market is doing as well as it is. I’m guessing the powers that be are either betting on not much happening since there was not a blue wave, but still see stimulus money poring in.
Housing prices are up also. I guess that’s a combination of low rates and more people moving south.
SteveinMN
11-19-20, 10:56pm
Housing prices are up also. I guess that’s a combination of low rates and more people moving south.
Housing prices are up in Minneapolis/St. Paul, too. Those folks aren't moving south. Maybe it's just another market index that defies common sense.
Guess I should have keep more, and I’m now up ytd. I’m a little over 50% stocks now, ill just leave it there for now. I still don’t see how the market is doing as well as it is. I’m guessing the powers that be are either betting on not much happening since there was not a blue wave, but still see stimulus money poring in.
Housing prices are up also. I guess that’s a combination of low rates and more people moving south.
I am aiming to get back to an allocation of 10% cash, 45% fixed, and 45% stocks but it will not be til middle of next month, as I have a cd coming due and will not put it back in fixed. This is what I feel most comfortable with right now and going forward, as I will be 65 in the spring.
So glad you are back up for the year! Still working on it.
Powered by vBulletin® Version 4.2.5 Copyright © 2025 vBulletin Solutions Inc. All rights reserved.