The stock market is tanking, we should be happy right????

User Forum Topic
Submitted by flu on February 6, 2018 - 8:46am

I remember there were a lot of folks here banking on a large correction to allow them to come out financially ahead versus everyone else....The rational was to sit out the market for a very long time, maybe years, and then when the market correct , jump right in and do much better than everyone else.

I am just curious, now that we have a 1500+ pt Dow plunge, are you folks hoping for that crash now jumping in or are you waiting for an additional 1500pt plunge on top of another 1500pt plunge, just like waiting for real estate to correct 40-50% after previously correcting during the last meltdown.

....or were you a bear that finally capitulated after seeing the markets going up week after week, and jumped right into the market head and toe, when the markets were high..
and are now part of this market correction just like most everyone else?

it just seems like there are no cheerleaders of the market correction here, which is sort of surprising....because I thought this is exactly what some folks wanted... things seem really quite...

What says you spdrun?

Submitted by harvey on February 6, 2018 - 9:23am.

Look at the five year chart and the past few days is not even visible.

Submitted by The-Shoveler on February 6, 2018 - 9:46am.

LOL I am still waiting for 5% FDIC CD's to make a comeback.

I am mostly out of the market just because of my age.

The decline so far is interesting but not enough to get me excited yet and I don't really think the market will sell off enough to get me back in.

(The economy I think is still doing fairly well yet).

Dow down 40-50% maybe I could get excited to put more money in (even despite my age).

Submitted by scaredyclassic on February 6, 2018 - 9:51am.

I'm excited.

Submitted by moneymaker on February 6, 2018 - 8:46pm.

I'm happy that I'm not in but I may get back in if it drops more! My issue is that I'm talking about 401k here and I know bonds are not a good place to be either when rates are rising. I'm starting to think about retirement so I disagree with Vanguard that I should be 65% in. Perhaps later this week I will get 50% in, we'll see.

Submitted by kev374 on February 7, 2018 - 11:32pm.

c'mon man... 7% decline is not tanking, it went up that much just in Jan, mathematically it has to correct otherwise what kind of annual return are you expecting.. 150%?

Submitted by flu on February 8, 2018 - 1:46am.

kev374 wrote:
c'mon man... 7% decline is not tanking, it went up that much just in Jan, mathematically it has to correct otherwise what kind of annual return are you expecting.. 150%?

if you bought into the indexes at the beginning of the year, you are now negative . 7% is a lot. it's slightly above a reasonable annual return.

Submitted by flu on February 8, 2018 - 10:52am.

Dow down another 500+pts... getting close to 10% correction....how are folks feeling now? housing doesn't even correct this fast.

Submitted by carlsbadworker on February 8, 2018 - 10:56am.

flu wrote:
Dow down another 500+pts... getting close to 10% correction....how are folks feeling now? housing doesn't even correct this fast.

500pts is a tiny blip in the long view:

http://www.multpl.com/shiller-pe/

We are about 50% over-valued according to the chart above, so wake us up when you have 20 days like this in a roll.

Submitted by carlsbadworker on February 8, 2018 - 1:40pm.

flu wrote:
Dow down another 500+pts... getting close to 10% correction....how are folks feeling now? housing doesn't even correct this fast.

There are a few individual stocks that are dropping close to my buying range after today. Index still seems too expensive for me.

Submitted by flu on February 8, 2018 - 1:58pm.

carlsbadworker wrote:
flu wrote:
Dow down another 500+pts... getting close to 10% correction....how are folks feeling now? housing doesn't even correct this fast.

There are a few individual stocks that are dropping close to my buying range after today. Index still seems too expensive for me.

I'll just wait for my $5000 monthly auto investment to kick in end of February, March April, etc.

10% loss since the beginning of the year. it will take a long time just to break even....home prices don't even fall that quickly that fast in better parts of town. why worry about how expensive home prices are...at least one can live an an overpriced home that correct say 10%. one can't live in index funds that correct 10%...

I guess this is why a good portion of wealth is still made from old school rental property....much more predictable it seems.

Submitted by FlyerInHi on February 8, 2018 - 2:27pm.

flu wrote:

I guess this is why a good portion of wealth is still made from old school rental property....much more predictable it seems.

That's a very observation flu. I prefer real estate.
But, in real estate, you won't become billionaire, or even multi-millionaire. Much easier and faster with stocks.

Submitted by ucodegen on February 8, 2018 - 3:07pm.

FlyerInHi wrote:
flu wrote:

I guess this is why a good portion of wealth is still made from old school rental property....much more predictable it seems.

That's a very observation flu. I prefer real estate.
But, in real estate, you won't become billionaire, or even multi-millionaire. Much easier and faster with stocks.


I ran some calcs a few years back and came up with decent and consistent returns above 10% for long periods of time with rentals. I factored in many things including tax advantages including depreciation allowance at income tax rate vs recapture capital gains at cap gains rates on taxes, the counter balance of asset appreciation vs money depreciation etc. It was part of a rent vs buy calc I did years ago. It was interesting and almost made me pull the trigger on getting rental property.

As for the downturn, I expected it and am expecting a total of nearly 15%. Since I have been in the market (w/ not much churn), I am still ahead for the past year + 1 month by about 16%. Because I was expecting it, I was and am keeping a good sized block of cash on the side and am planning to use it once the day-traders wring and wipe themselves out.

I think that part of what sparked it was that day-traders were expecting an 'instant' jump in earnings within the first month of the new tax law and panicked when they didn't see it. They forgot it all depends upon what the date is for the corporate tax year, and one month does not a quarter's earnings make.

So its time to keep the cards close to the chest and keep the green casino visor down low over your eyes.. its still going to be bumpy, but patience pays off... ☺

PS: With reference to Shiller PE graph, I find PEG more useful because it factors in growth. One is willing to tolerate a higher PE if there is strong growth. I also look at growth in revenues and how much is being paid for that and whether they have a chance of recapturing the cost. Looking at only PE is oversimplification.

Submitted by flu on February 8, 2018 - 3:34pm.

ouch. markets ended badly....are we back to March 2017 prices yet?

funny thing is I got a bunch of CDs maturing on March 2018 too. maybe that was a good thing afterall, lol.....

me thinks the indexes will be negative this year. gonna be difficult to recover this loss ....

Submitted by spdrun on February 8, 2018 - 4:01pm.

We're back to Nov or Dec 2017, not March...

Submitted by The-Shoveler on February 8, 2018 - 6:04pm.

flu wrote:
ouch. markets ended badly....are we back to March 2017 prices yet?

funny thing is I got a bunch of CDs maturing on March 2018 too. maybe that was a good thing afterall, lol.....

me thinks the indexes will be negative this year. gonna be difficult to recover this loss ....

Did you hear Jim Cramer Yelling.

The guy gets upset sometimes

Submitted by harvey on February 8, 2018 - 7:30pm.

flu wrote:
ouch. markets ended badly....are we back to March 2017 prices yet?

funny thing is I got a bunch of CDs maturing on March 2018 too. maybe that was a good thing afterall, lol.....

me thinks the indexes will be negative this year. gonna be difficult to recover this loss ....

"this loss?" S&P 500 is down about 4% since Jan 1.

Hysterical news headlines don't change the rules of arithmetic.

Submitted by FlyerInHi on February 9, 2018 - 12:58pm.

Reasons given for the stock market drop are the deficit and higher interest rates.

whatever happened to the people who predicted hyperinflation and solar debasement? I wonder how their portfolios did in the last 10 years.

Submitted by evolusd on February 9, 2018 - 6:04pm.

Turning 39 this year. Had about 30% of my retirement in cash up until last week, at which point I got sick of watching the market go up up up and dumped about half of it into a few large cap growth stocks, only to see them get pummeled this week. Oh well...lots of time before I retire.

Curious to see where we go from here.

Submitted by flu on February 10, 2018 - 2:33pm.

evolusd wrote:
Turning 39 this year. Had about 30% of my retirement in cash up until last week, at which point I got sick of watching the market go up up up and dumped about half of it into a few large cap growth stocks, only to see them get pummeled this week. Oh well...lots of time before I retire.

Curious to see where we go from here.

I think if you make regular investments over the longer period of time, you have nothing to worry about. That way you get the highs and the lows and everything in between....

The best performing account I have is my kid's 529 account because they severely limit what you can and cant do.

Currently, I do a automatic investment of roughly $5000/month into post-tax index and 529 accounts, in addition to the maximum 401k contribution. I have no mortgage and have net rental income, and since my life's monthly "operational costs" are relatively low, I have nothing better to do with the surplus.
The automatic investment I've done since 1996, though the amount was much less back then.

Submitted by flu on February 10, 2018 - 2:32pm.

.

Submitted by AN on February 18, 2018 - 1:43am.

So, who here bought 10 days ago? If you simply bought the DOW, you're up about 5% in 10 days. If you bought the NASDAQ, you're up 6.8%. Pretty awesome return.

Submitted by kev374 on February 20, 2018 - 11:04pm.

down again and Morgan Stanley has just come out saying this is just an appetizer and to wait for a massive crash later this year... buckle up. Seriously what did the retards in Washington think was going to happen when they took on all this ridiculous debt?

Submitted by henrysd on February 20, 2018 - 11:48pm.

kev374 wrote:
down again and Morgan Stanley has just come out saying this is just an appetizer and to wait for a massive crash later this year... buckle up. Seriously what did the retards in Washington think was going to happen when they took on all this ridiculous debt?

You never need to listen wall street sell side recommendations - professional investors never listen to them. They are fuckers, liars and also sales men of brokerage houses. When Goldman quietly shorted mortgage bond market just before the financial crisis, they were just boasting the mortgage bond products to public.

U.S. 10 yr bond yield is already the highest in developed world. France and Germany have negative 2 yr bond yield, 5 yr bond yield was negative a few months ago, now just turned slightly positive, 10 yr yield at 0.7 or 1.0% now There is still some global deflation force (mostly Europe and Japan) which will limit U.S. bond yield:
http://www.wsj.com/mdc/public/page/2_302...

When corporate bond market smells trouble, that is the time we need to worry. Right now corporate debt side is super healthy.

Submitted by flu on February 21, 2018 - 8:03am.

kev374 wrote:
down again and Morgan Stanley has just come out saying this is just an appetizer and to wait for a massive crash later this year... buckle up. Seriously what did the retards in Washington think was going to happen when they took on all this ridiculous debt?

I fail to see how this is Washington's fault. and if a crash was so obvious that it was going to happen to everyone, why would one move a massive amount of money into the market right before it happens..

Seems to me that the beginning this year the markets were still going gangbusters and that drew even the most bearish into the markets from the fear of missing our additional gains.

My has the markets changed its tune in just a few weeks. it will be a perfect time to buy end of this month, and end of next month, and the following month, and the month after, and the month after.....

bring on the big correction. I am excited.

Submitted by plm on February 21, 2018 - 11:17am.

flu wrote:
kev374 wrote:
down again and Morgan Stanley has just come out saying this is just an appetizer and to wait for a massive crash later this year... buckle up. Seriously what did the retards in Washington think was going to happen when they took on all this ridiculous debt?

I fail to see how this is Washington's fault. and if a crash was so obvious that it was going to happen to everyone, why would one move a massive amount of money into the market right before it happens..

Seems to me that the beginning this year the markets were still going gangbusters and that drew even the most bearish into the markets from the fear of missing our additional gains.

My has the markets changed its tune in just a few weeks. it will be a perfect time to buy end of this month, and end of next month, and the following month, and the month after, and the month after.....

bring on the big correction. I am excited.

Not sure why you would wish for a declining market. I much prefer the rising markets the past two years. I'm going to start increasing cash instead of making money owning stocks. Was at 99 percent stock. Even after selling GOOG a few weeks ago, I'm still at 96 percent stock. In this high volatility environment, I need to keep reducing my stock ownership by selling. This choppiness is only good for day traders.

Submitted by spdrun on February 21, 2018 - 12:15pm.

Why wish for a crashing market?

Because a crashing market would scare the sheep out of ALL investments -- great if you have cash.

Also, a hard market crash before the 2018 election would guarantee House and Senate turning blue, and maybe Trump impeachment. Should be fun to watch if it happens.

Submitted by The-Shoveler on February 21, 2018 - 12:30pm.

I am mostly out of the market but I still think having the market and the economy doing well would work best for me (and the majority of the country).

IMO having a downturn is really only good for a small segment of the population and may even further the divide that is tearing the country apart.

I really think there is a chance the USA will not exist in its present form in 25 years.

Submitted by spdrun on February 21, 2018 - 12:35pm.

^^^

That's not a bad thing -- there's no reason why CA needs to pay to support states that are frankly ungrateful. It would be better if the US did not exist in its present form in a few decades.

Submitted by The-Shoveler on February 21, 2018 - 12:51pm.

I think there is even more of a chance that California will not exist in its present form in 25 years.

Even if the USA does not split itself apart California likely will.

Submitted by FlyerInHi on February 21, 2018 - 1:03pm.

The-Shoveler wrote:

I really think there is a chance the USA will not exist in its present form in 25 years.

Vladimir Putin’s lifelong achievement.

I always think of non native Californians as immigrants regardless they are from Mexico or Kansas. We are going to have illegal immigrants from Iowa working as waiters in LA.

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