Author Topic: the coming crash... of 2010, 2011, etc etc  (Read 2428 times)

rob in cal

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the coming crash... of 2010, 2011, etc etc
« on: January 01, 2018, 10:04:23 PM »
  I find it illuminating to read articles from years ago about the coming crash of 2012, 2013 etc all chock full of charts about p/e ratios, overvalued markets, quantitative easing, out of control budget deficits, the dollar no longer being used as the worlds reserve currency, the Chinese bond vigilantes, etc etc all leading to a clear case of an imminent crash, no later than the spring or summer of 2014, with martial law possibly following. 

JAYSLOL

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Re: the coming crash... of 2010, 2011, etc etc
« Reply #1 on: January 01, 2018, 10:34:59 PM »
Yeah, there's no shortage of "experts" on the internet that claim the sky is falling in their every podcast or YouTube video, doomsday blog etc.  One day markets will temporarily lose a chunk of their value and we will have tens of thousands of these "experts" referring to their last prediction while ignoring the last decade of failed predictions.  I love the Mustachian way, ignore the fear and noise, invest smart, live and breath optimism, but be badass enough to weather whatever comes our way. 

Mighty-Dollar

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Re: the coming crash... of 2010, 2011, etc etc
« Reply #2 on: January 02, 2018, 12:55:31 AM »
Scroll halfway down for comical doom and gloom headlines staring in 2014.
http://investingadvicewatchdog.com/market-timing.html

steveo

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Re: the coming crash... of 2010, 2011, etc etc
« Reply #3 on: January 02, 2018, 01:11:29 AM »
To be fair a crash is coming. To be realistic no one can predict the exact year it's going to occur.

Mighty-Dollar

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Re: the coming crash... of 2010, 2011, etc etc
« Reply #4 on: January 02, 2018, 01:18:05 AM »
Imagine people who sold all their stocks after Greenspan's irrational exuberance speech. Stocks went up another 75% before the 2000's lost decade.

CoffeeR

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Re: the coming crash... of 2010, 2011, etc etc
« Reply #5 on: January 03, 2018, 08:48:28 PM »
Besides markets are most likely to crash when everyone thinks that everything is fine.
Hmm... most people on these forums seem to think "everything is fine" and "tune it all out" and "ignore the noise".  This is indeed ominous.

PaulMaxime

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Re: the coming crash... of 2010, 2011, etc etc
« Reply #6 on: January 03, 2018, 10:19:02 PM »
Besides markets are most likely to crash when everyone thinks that everything is fine.
Hmm... most people on these forums seem to think "everything is fine" and "tune it all out" and "ignore the noise".  This is indeed ominous.

I rode out the crashes of 2000 and 2008 and came out fine on the other side. What course of action do you suggest for a situation that nobody can predict? Every crash in history looks like an opportunity in hindsight.

CoffeeR

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Re: the coming crash... of 2010, 2011, etc etc
« Reply #7 on: January 04, 2018, 09:06:22 AM »
Besides markets are most likely to crash when everyone thinks that everything is fine.
Hmm... most people on these forums seem to think "everything is fine" and "tune it all out" and "ignore the noise".  This is indeed ominous.
I rode out the crashes of 2000 and 2008 and came out fine on the other side. What course of action do you suggest for a situation that nobody can predict? Every crash in history looks like an opportunity in hindsight.
My wry sense of humor attempt obviously failed miserably.

nereo

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Re: the coming crash... of 2010, 2011, etc etc
« Reply #8 on: January 04, 2018, 09:15:01 AM »
To be fair a crash is coming. To be realistic no one can predict the exact year it's going to occur.
...and to be fair, there's always a bull market coming.  To be realistic no one can predict the exact year...
:-P

ChpBstrd

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Re: the coming crash... of 2010, 2011, etc etc
« Reply #9 on: January 04, 2018, 09:32:24 AM »
I put together a spreadsheet listing the returns of the S&P 500 for the last 40 years to calculate the expected value of a protective put. Down years are surprisingly infrequent compared to how much we hear about them. 20-30% up years are sprinkled throughout.

The EV of a one-year protective put that kicks in and prevents the possibility of a loss is just over 2%. Interestingly, 2 year puts on SPY cost about 4% of the amount protected - not the best deal. However, if you buy the 3 year LEAPS and roll to the next 3 year LEAP each year, the likely time decay of your options would roughly equal the EV of the protection. In doing this, you are tying up about 10% of your capital to protect the other 90%. However, what's the alternative these days? A 90/10 portfolio that offers minimal yield on the 10% and zero downside protection?

So fearful or not, there's not much excuse not to invest in the markets.

Data:
http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html

TheAnonOne

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Re: the coming crash... of 2010, 2011, etc etc
« Reply #10 on: January 04, 2018, 11:48:43 AM »
My favorite from 2014 was

"CIA Insider Warns: "25-Year Great Depression is About to Strike America"

What would a CIA insider know about the markets or how would he be able to know it was going to last **25** damn years?