[Coronita]

Put in time now or put in time later, there is no free lunch (well, at least most of the time). I keep hearing people refer to work while they are younger as ball and chain. The funny part is that ball and chain exists for a lot of people a lot longer who didn’t put the time up front, it’s just stretched out over a longer period of time, lol.

[Coronita]

[quote=scaredyclassic][quote=sdrealtor][quote=Reality][quote=plm]
Actually I think that selling and buying back later at a lower prices is a way to have even better returns but much riskier since you have to time the market properly. Isn’t it safest to buy and hold and just don’t sell when they market crashes?[/quote]

What if when you need retirement income coincides with the crash?[/quote]

Thats why I buy for total return including growth and income. If they maintain/grow their dividends I’ll never have a need to sell anything. I also have solar (no electric bill), drought tolerant landscape (minimal water bill), house close to paid off (minimal housing expense), tesla (no gas bill) etc. Oh and I have a very full wine cellar:)[/quote]

this seems very right. how much is it worth to have a paid off house? not to worry about things going really wrong with investments?

that said, I’m trying to refi with a large cashout to dollar cost average into various funds. :0

still good to keep expenses low.[/quote]

That what dividend income , rental income, and a job income is for. Reduces the chances of 3 simultaneous failures. Trying to avoid touching any 401k/IRA even for emergencies so it can compound as long as it can before its tapped.

[Coronita]

[quote=plm][quote=Coronita]I moved my trading account back to more of a cash holding again by selling half of everything.

I guess I’m just thinking with all the social media i-gen stars now talking about the stock market and how easy it is to make money, and anyone can do it… Reminds me of old times when a financially illiterate receptionist could be heard talking about how easy it is to make money in the stock market during coffee breaks back in 2000.

If we see a correction, maybe I’ll slowly move things back in. Otherwise, I’m contend with things this year.

Less greedy, more caution.[/quote]

I suppose the question really is given the strong demand for stocks (there really isn’t anything else to invest in), how high does it go before it breaks down. I think it can go up alot more before it crashes. And if it does crash earlier, I’ll just ride it out. I don’t think my main holdings like Apple, Amazon, Nvidia, Microsoft and AMD are going to go bankrupt. Well maybe AMD could go down alot if Intel performs better. But at that point I’ll be playing with house money.[/quote]

I think it’s tough to guess the absolutely bottom or top. For me, taking a step back, the way to look at it is….Is 40% YTD really typical, or way out of the norm? If so, why be greedy and try to go after an additional 10, 20, 30%? It was a total fluke and total luck that when covid hit, that the markets didn’t crater any further than it did. Things could have gone really bad the other way for everyone that jumped back into the markets into individual stocks.

I was already content if I could see 4-6% in a year I thought the markets would have gotten trashed after covid. You already beat most of the people that thought covid would have taken the entire markets down and either sat out this year, or god forbid shorted the markets when they thought covid would have made things much worse. You already beat all the folks that were hoping for that big crash to get back in the markets but didn’t think the covid correction was big enough. And you also beat all the people who lost their job who had to either cash out the 401k or didn’t have any additional disposable income to speculate, because they were worried about putting food on the table and paying for rent or their mortgage. (some empathy for those folks because who got hit and who didn’t because of covid was also some random luck thing…plenty of workers plenty of business owners got hit pretty hard in the same exact way.) Relatively speaking, anything else from this point on is just icing on the cake, and personally one needs to seriously consider the risk versus reward from here on out imho.

The way for me to self discipline is to put that money to another use that is way less risky, even if it loses some money or stays flat. Eventually, you’re luck is going to run out. And you won’t know when.

[Coronita]

[quote=The-Shoveler]I predict mayhem no matter who thinks they won IMO only.

choose your intolerant leader, any descent from official message will not be tolerated.[/quote]

Well, some folks wants to severely cripple 401k plans for anyone that isn’t poor.

https://www.forbes.com/sites/ebauer/2020/08/25/joe-biden-promises-to-take-away-401k-style-retirement-savings-whats-that-mean/#3f9385214eb0

Wanting it and doing it are two different things, but I think things will get reeled in.

Old savers with something like 7 figures in it already will probably be grandfathered in. New savers trying to accumulate wealth, it’s going to get tougher. Not my problem.

[Coronita]

Party like it’s 1999. Deja Vu.

I think we are at the point of Round 2 of euphoria.
Back in the late 90ies, this happened too.

I distinctly remember there was a stock run up while I was still in college with companies like Netscape, Spyglass, and a few other dot.coms

And then there was a medium correction where the first way of these dotcom companies crapped out… And then there was a second wave of euphoria for a second wave of dot.com companies starting late 1998 early 1999 that was even more crazy than the first wave. This second wave included companies like WebVan, eToys, MySimon, pets.com, Vitria, Ariba, CommerceOne, and all the enterprise software companies supporting all this shit….BEA, Tibco, JD Edwards, Peoplesoft, IONA, etc,etc,etc Somewhere buried in that mess was also Sun Microsystems, Nortel Networks, Worldcom, Ascend Communications, USRobotics, 3COM, and a bunch of DSL companies.

[Coronita]

I moved my trading account back to more of a cash holding again by selling half of everything.

I guess I’m just thinking with all the social media i-gen stars now talking about the stock market and how easy it is to make money, and anyone can do it… Reminds me of old times when a financially illiterate receptionist could be heard talking about how easy it is to make money in the stock market during coffee breaks back in 2000.

If we see a correction, maybe I’ll slowly move things back in. Otherwise, I’m contend with things this year.

Less greedy, more caution.

[Coronita]

[quote=plm]I think there may be a correction too but high tech growth should be hurt less since they work in the stay at home economy. It’s the retail/travel that’s recovered somewhat that will probably head down.

Just don’t see a vaccine taking effect yet and you got schools opening. Incumbents no longer boosting the economy to get re-elected.[/quote]

Good luck to you. For your sake, hopefully, this time it really is different.

[Coronita]

[quote=plm][quote=Reality][quote=plm]
Actually I think that selling and buying back later at a lower prices is a way to have even better returns but much riskier since you have to time the market properly. Isn’t it safest to buy and hold and just don’t sell when they market crashes?[/quote]

What if when you need retirement income coincides with the crash?[/quote]

Well this last crash only lasted for a few months… But seriously, I have enough cash for a couple years worth of expenses and I have rental and significant dividend income as well so its unlikely I will have to sell at the bottom.[/quote]

I think Reality was referring to not just the brief crash that happened due to covid.

I think Reality was referring to a real crash like the one in 2001 which lasted for several years and which a lot of overspeculated or just nonsense high flyer companies ended up crashing to oblivion and never recovered. Many of us remember.

Index fund investments survived and recovered..Many individual stocks didn’t and many people who thought they could outsmart the indexes only thought so because they never really experienced a real life crash.

If you look at how the indexes are performing right now, it’s sort of misleading. It’s not that most of the companies that make up those indexes are all doing well this year Most of them are still negative. It’s just a few select companies in those indexes have went beserk and those few companies are making the entire index look good. Companies like AMD which is trading around $86/share even though it absolutely makes no sense.

Regarding protection. I can only speak of a large company issued stock options grant. Back then, one thing we did do to protect from a big crash was to buy out of money out options regularly. I worked for a company that priced there IPO at $30/share and opened at $217, and within that first 6 months went as high as $415/share even though we were still unprofitable. Our valuation was a $6 billion software company even though are revenue was around $50million. Made no sense whatsoever. I remember the moment put options were available, many of us were buying them when the stock price was still above $300/share just so it could protect all the unvested employee stock options that had a $30 strike price that we needed to wait 4 years to fully vest

It wasn’t long after the company stock fell to $7/share.

Retail speculators lost their shirts.

Employees got laid off.

Some employees that got laid off had a big grin on their face because suddenly their out of money put options that was insurance for their unvested company issued stock options was worth a lot of money, and they didn’t need to wait for 4 years of vesting to get that money which was almost the same as how much their company issued options would have been…

Since then, companies have gotten a lot smarter. Many have a company policy against you or a family member owning derivatives of the company stock….

Whenever things really get frothy, individual stock ownership gets a lot more risky. I think for some of these speculation, there has to be an exit strategy because it is almost impossible to be consistently have the winning hand all the time. Once you’ve reached a point of a lucky windfall that matters, it’s imho an equal amount of effort to try to preserve and prevent losing most of it, and that means finding a way to shift that money somewhere else that is less likely to lose as much as fast as you can in individual stocks.

At least that’s how I was able to afford to buy a primary SFH down here when I moved back in 2004, when housing was already pretty expensive and also getting frothy.

[Coronita]

So here’s another rant. I recently had to replace a window regulator from an Audi and also from a Miata.

The Miata required to take off the door panel, loosen 8 bolts, take the window out, and remove the regulator.

The Audi?
Needed to take the door panel off.
Then I needed to unbolt the entire window frame and take it out of the door. Then I could remove the window…
Then I needed to drill out 4 rivets holding the window regulator to the window frame.

Because unlike most other easy to service cars that uses normal bolts to secure a window regulator, Audi decided to brilliantly attach them using one time use rivets, and of course the rivets can only be accessed from behind the window frame, which requires you to remove the entire window frame and assembly, and then when you put it back in, muck around with realigning the window frame with the seals so that it seals properly when closed.

And since it used rivets, it meant I had to go buy a rivet gun and find rivets that fit, or pay $2 per rivet from Audi for the Audi rivets.

Here’s the damn thing

So while the Miata took less than 1/2 hour to replace. The Audi took like 4-5 hours to replace something that costs 30 bucks.

Thankfully, my labor is cheap. If this was a $125/hr mechanic…..My tool collection also keeps growing and growing.
I swear. They must do this on purpose.

[Coronita]

[quote=svelte][quote=Coronita]

read my comment about the GTI. I think for some VWs, forget which ones, they also went from a metal oil pan to a plastic one. So, if you are unfortunate and bottom out on something , it’s no longer just denting your oil pan…..
[/quote]

I don’t know. My cars are babied. I’ve got a 16 yo car that doesn’t have a drop of oil on the bottom side. My mechanic called me out to the shop floor to show me that – he couldn’t believe not a spot of oil, tranny fluid, nothing.

I’ve been driving cars for 4 decades now and only once have I had a major problem with my car – a bent valve on a 1970 car when I had it during the 1970s. And I bought that with 87K miles on it so who knows what it went through before I got it.

Every other car, the worst I’ve had is alternators, water pumps and once a radiator. Maybe I’ve been lucky, but it has made me pretty brave when buying cars.[/quote]

I accidentally deleted the comment about the oil pan. oops..

I think you and I are probably not the majority of the car owners who baby their cars. I change my oil after 2 autocrosses or 3000 miles, my “lifetime” transmission and diff fluid regularly and brake fluid regularly.

The majority of car owners, in this country at least, treat their cars like maintainence free appliances. I think maybe why the same cars in Europe seem to last a lot longer than here is because they maintain them better maybe? Don’t know

I think for me I want a fairly reliable car that I won’t be afraid to tinker with.tinkered Tesla’s are nice cars, just not something I would enjoy because there’s not much you can do to tinker with it.

[Coronita]

[quote=svelte][quote=gzz]
Golfs are sold in massive numbers in the third world, I doubt they are bad to maintain.
[/quote]

I saw this on Craigslist the other day and it really, really called out to me:

https://sandiego.craigslist.org/esd/cto/d/la-mesa-2015-golf-sportwagen-sel-tdi/7182469738.html

Then I noticed it was a diesel and the appeal evaporated.[/quote]

This was the comment about the “valve cover” on the MK6. I’m not sure if they changed the design again but on the MK6 it was a pain and expensive job.

https://www.golfmk6.com/forums/index.php?threads/replacing-valve-cover-gasket-what-else.306679/

Read this thread ..and there’s a dozen or so about these… total clusterfvk.

[Coronita]

I think if you buy a new car, reliability probably doesn’t differ that much. But I can tell even with newer German cars, they are a pain to work on. BMW and VAG use so much plastic in critical components, that if you keep the car for 10-15 years, those things start to get brittle and fail. And the way German cars are designed, it’s often hard to get to those things or just to do really simple things.

My former coworker had a newer VW gti and he was having an oil leak 5-6 years into ownership. I figure valve cover gasket , and told him to get it done. He gets an estimate for $800. Whoa. I thought maybe he just went to a mechanic that was trying to rip him off because how hard could replacing a valve cover gasket be? Well,apparently it’s a big job and a royal pain in the ass, and $800 wasn’t that bad… These VW GTIs don’t have traditional valve covers. they have a “cam girdle” that holds the camshafts in place. So when the gasket leaks, it’s a big job because to replace the seal, you are disassembling a lot.

Now, if this was a luxury car, spending say $800 to replace a leaking gasket in 6-7 years probably is acceptable for a luxury car. It’s an expensive car, you have to pay to play.

But we are talking about a GTI which is suppose to be an economical people’s car. But because of this design, it’s incredibly expensive to upkeep, and the cost to maintain it quickly ends up being more than the car is worth. That’s why VW’s will always depreciate like crazy. Reliability might have improved, but their serviceability certainly has not. It’s as expensive to maintain a VW out if warranty and free maintenance period as it is to maintain as an Audi.

I have learned that as part of owning German cars for the long haul, learn to work on them yourself..Parts isn’t expensive, labor is. Or simply don’t keep them… Lease them and return them and let them be other people’s problem. Or get really cheap German cars like $4000-5000, and just do oil and brakes and ignore everything else that breaks. And finally throw it away a few years later.

If you like how VW drives, I would go test drive a comparable Mazda. I think Mazdas are as close to german car driving dynamics a Japanese car is going to get.

The new Mazda 3s they have over in europe with the new skyactiv X engine is pretty impressive. If I had to get a family sedan right now, it would probably be a Mazda 6. They aren’t as reliable as a Camry, but they drive a lot better and I like the fit and finish better.

[Coronita]

[quote=gzz]What car/dealership Svelte?

I went to my local VW, they had a used 2018 with only 8k miles on it listed for 27k. A 2020 same model and specs has an MSRP of 30.5k and is sold all over the place for 27.5. So they are selling the used one 2 model years back for only $500 off.

I offered 24k, they didn’t even counter.[/quote]

Friends don’t let friends buy a Volkswagen product. Please don’t.

It’s like buying an Audi , only worse. At least with an Audi, you can sort of convince yourself expensive maintenance for a luxury car. With a VW, you’ll pay the same expensive maintenance costs of an Audi but with a VW label on it that’s suppose to be inexpensive and affordable

[Coronita]

[quote=The-Shoveler]Seems to be happening enough to have an effect.

San Francisco sees record-breaking drop in rent prices amid pandemic, according to Zumper data

https://abc7news.com/san-francisco-rent-median-drop-covid-19/6288920/

Probably the shift to remote working more than anything else, Our company just announced that they are permanently closing some offices and shifting to remote working for those locations (no one was laid off). Just guessing but I think we will be saving several million a year doing that.
Seems each time an office lease expires they just go remote, We will still need our facility as we have the manufacturing and lab space requirements.

Even in our facility most workers are expected to remain remote until at least next January, then they will re-evaluate the situation.[/quote]

Yup. Commercial REITs are really screwed.

[Coronita]

https://www.sandiegouniontribune.com/business/story/2020-08-24/bay-area-couple-priced-out-and-working-remotely-buy-san-diego-house-instead

Come to think about this, I did this similarly in the early 2000’s. I moved down here and was working for a company headquartered in the bay area, making bay area comparable inccome.

[Author]

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