Author Topic: the end is nigh!  (Read 18603 times)

2Birds1Stone

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Re: the end is nigh!
« Reply #50 on: March 25, 2015, 04:05:55 PM »
It's very interesting to read message boards that have not existed prior to the last real market downturn. It's going to be interesting to see the change in sentiment here during the next bear market.

Because there will be even more people calling for market timing strategies than there already are?
For a multitude of reasons.

Eric

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Re: the end is nigh!
« Reply #51 on: March 25, 2015, 04:32:25 PM »
It's very interesting to read message boards that have not existed prior to the last real market downturn. It's going to be interesting to see the change in sentiment here during the next bear market.

Because there will be even more people calling for market timing strategies than there already are?
For a multitude of reasons.

Okay.  You don't have to share if you are shy.  I, for one, will be most interested not in the increased market timing craziness that will inevitably result, but more to see who really follows through with the "I'm young so I wish the markets would crash now" line of thought.  Although I'm sure there will be a lot of overlap.

Personally, I had a fair amount invested in 2008/9, so I feel like I'm pretty well prepared.  Plus hanging around here helps steel my nerves when it comes to worrying about temporary market moves.

2Birds1Stone

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Re: the end is nigh!
« Reply #52 on: March 25, 2015, 04:35:23 PM »
I hope they crash, crash hard. I have been an investor for only 4 years. With the new job, most of my accumulation will happen in the next 10 years. Bring it on. Feel free to quote this post if I start crying and sell low ;)

jmusic

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Re: the end is nigh!
« Reply #53 on: March 25, 2015, 04:44:44 PM »
I hope they crash, crash hard. I have been an investor for only 4 years. With the new job, most of my accumulation will happen in the next 10 years. Bring it on. Feel free to quote this post if I start crying and sell low ;)

While I can understand your perspective, the truth of the matter is that severe market downturns tend to correlate with a lot of corporate layoffs and high unemployment rates.  So even if you don't lose a lot of $$ in the market, you could lose your job...

Eric

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Re: the end is nigh!
« Reply #54 on: March 25, 2015, 04:47:11 PM »
I hope they crash, crash hard. I have been an investor for only 4 years. With the new job, most of my accumulation will happen in the next 10 years. Bring it on. Feel free to quote this post if I start crying and sell low ;)

Excellent!  Yes, best to put it in writing.  :)

2Birds1Stone

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Re: the end is nigh!
« Reply #55 on: March 25, 2015, 04:47:40 PM »
I hope they crash, crash hard. I have been an investor for only 4 years. With the new job, most of my accumulation will happen in the next 10 years. Bring it on. Feel free to quote this post if I start crying and sell low ;)

While I can understand your perspective, the truth of the matter is that severe market downturns tend to correlate with a lot of corporate layoffs and high unemployment rates.  So even if you don't lose a lot of $$ in the market, you could lose your job...
Thankfully I'm in sales at one of the largest enterprise management software companies in the world. Make it here for a few years, and you are extremely employable elsewhere. YMMV

2Birds1Stone

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Re: the end is nigh!
« Reply #56 on: March 25, 2015, 04:49:33 PM »
As an aside, I sleep better knowing that I have 5x basic annual living expenses in the stache. Between unemployement, frugality, a side gig doing consulting, I'm not too stressed.

retireatbirth

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Re: the end is nigh!
« Reply #57 on: March 25, 2015, 05:17:45 PM »
I am young and know that a market correction right now would actually be very good for me since I have a good income rolling in. I can't say I'm hoping for a market correction, though, because I do feel a little pain on days like these when it's only 1-2% down. But, I'm logical enough to understand the strategy and I was actually able to add another $2.5k to my asset allocation that will go through tonight.

I don't think the young investors here will change their tune at all unless they already have big money in the market. If you have even $200k, a 15% correction is only $30k and likely less if you're diversified. Maybe it's just me, but $170k vs. $200k doesn't even look that scary when it's just paper money. I can save that much in 6-8 months without the market's help. I guess it all depends on your situation. It would be tough if you lost a job and weren't able to continue investing.

MoneyCat

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Re: the end is nigh!
« Reply #58 on: March 25, 2015, 06:14:36 PM »
I know markets bounce up and down during the year, but now we're nearly four months into the year and I've earned exactly 1.5% on my investments for the year.  That's not encouraging.

sol

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Re: the end is nigh!
« Reply #59 on: March 25, 2015, 06:24:47 PM »
I know markets bounce up and down during the year, but now we're nearly four months into the year and I've earned exactly 1.5% on my investments for the year.  That's not encouraging.

Why is that not encouraging?  That rate predicts an annualized return of 4.5% for the year.  I'll be thrilled if we actually end up positive for the year, given recent history:

2009   25.94%
2010   14.82%
2011   2.10%
2012   15.89%
2013   32.15%
2014   13.48%

With numbers like that in our recent history, anything above zero is a blessing.  Returns have been so stellar that simple reversion to the mean would suggest we're due for a down year. 

I feel like people are going to be all butt-hurt with any market return under 10%.  Things have been so good for so long that everyone's expectations are running a little high.

2Birds1Stone

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Re: the end is nigh!
« Reply #60 on: March 26, 2015, 07:10:40 AM »
I know markets bounce up and down during the year, but now we're nearly four months into the year and I've earned exactly 1.5% on my investments for the year.  That's not encouraging.

Why is that not encouraging?  That rate predicts an annualized return of 4.5% for the year.  I'll be thrilled if we actually end up positive for the year, given recent history:

2009   25.94%
2010   14.82%
2011   2.10%
2012   15.89%
2013   32.15%
2014   13.48%

With numbers like that in our recent history, anything above zero is a blessing.  Returns have been so stellar that simple reversion to the mean would suggest we're due for a down year. 

I feel like people are going to be all butt-hurt with any market return under 10%.  Things have been so good for so long that everyone's expectations are running a little high.

Things are about to get interesting. QE4 Incoming.

Cookie78

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Re: the end is nigh!
« Reply #61 on: March 26, 2015, 08:49:05 AM »
I'm new at investing, or at least new at paying attention to investments. I'm curious what my response will be to the next crash too. Technically I survived the last one, but I wasn't paying attention, so I have no idea what I 'lost' at the time. Unfortunately my 'financial advisor' was making a lot more off my money than I was while I wasn't paying attention.

The doom and gloom stories are starting to get to me now though. Everything seems perilous. Maybe that's always the case. I want to FI in 5 years, but I have a lot of instability, or at least it feels like it.

But I feel like I can get through it, especially with the support of this forum and its' awesome members.

arebelspy

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Re: the end is nigh!
« Reply #62 on: March 26, 2015, 10:09:44 AM »
It's very interesting to read message boards that have not existed prior to the last real market downturn. It's going to be interesting to see the change in sentiment here during the next bear market.

Current: New members come on during this bull market and say: "The market is overvalued, stocks are a terrible investment, should I still invest?" and the oldtimers say: "Stay the course, stick with your AA."

That'll change to: New members come on during a bear market and say "The world is ending, stocks are a terrible investment, should I still invest?" and the oldtimers say: "Stay the course, stick with your AA."


Big change.

;)
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PeteD01

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Re: the end is nigh!
« Reply #63 on: March 26, 2015, 10:12:39 AM »
To pour oil into the fire:

I have been reducing the stock market exposure of my investable assets over the last 22 months from 141% to 25% by the end of this week.
I did it with deleveraging and selling a ton of stock funds.
I will FIRE in two months and a significant percentage of my T72 income will be DCA'd into my new after-tax stash made up of index ETFs.

It turned out to be the best way to deal with the tax situation and has the benefit that I simply can continue what I have been doing successfully before FIRE:
Saving a portion of an income that is higher than what I need.

Funny thing is that the peace of mind coming with annuitization is already evident. The increased initial payout of the annuities lets me continue in accunmulation mode at a lower level than before and allows me to take advantage of the eventual bear market.

Kaspian

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Re: the end is nigh!
« Reply #64 on: March 26, 2015, 10:17:24 AM »
It's very interesting to read message boards that have not existed prior to the last real market downturn. It's going to be interesting to see the change in sentiment here during the next bear market.

Current: New members come on during this bull market and say: "The market is overvalued, stocks are a terrible investment, should I still invest?" and the oldtimers say: "Stay the course, stick with your AA."

That'll change to: New members come on during a bear market and say "The world is ending, stocks are a terrible investment, should I still invest?" and the oldtimers say: "Stay the course, stick with your AA."


Big change.

;)

^^ Indeed!

Whether you diversify or not, Sketch Guy had a great article last week:

http://www.nytimes.com/2015/03/16/your-money/diversification-is-the-sane-alternative-to-betting-big-on-one-investment.html

Quote
"...Luckily, the solution is an easy one. On Jan. 1 of each year, just figure out which asset class will do really well and move all your money into that investment. Forget diversification. Just pick the winner!"

sol

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Re: the end is nigh!
« Reply #65 on: March 26, 2015, 11:57:03 AM »
Can someone explain to me why vtsax is down 1.5% today while the S&P500 is positive for the day?

PeteD01

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Re: the end is nigh!
« Reply #66 on: March 26, 2015, 12:05:07 PM »
Can someone explain to me why vtsax is down 1.5% today while the S&P500 is positive for the day?

Maybe because the day is not over yet?

BarkyardBQ

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Re: the end is nigh!
« Reply #67 on: March 26, 2015, 12:07:53 PM »
Can someone explain to me why vtsax is down 1.5% today while the S&P500 is positive for the day?

VTSAX closed -1.53% yesterday. VTI is on par with SP500 today...

2Birds1Stone

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Re: the end is nigh!
« Reply #68 on: March 26, 2015, 12:37:45 PM »
Can someone explain to me why vtsax is down 1.5% today while the S&P500 is positive for the day?

Mutual fund prices update around 6 PM EST.