Top is in

[Caoineag]

Am I the only one who thinks... "hmmm this forum has only existed in the 'blue' section and never been thru and 'orange'?  So many of us talk a big game, but haven't weathered any real storms.

Except we have actually had threads about who was investing during the Great Recession so I am not sure I buy that no one has weathered any real storms.

[Tyson]

Of course nowadays those same types of people are saying "well we were over priced in 2014 so now we're really, really overpriced in 2017!". 

They may be right, but even if that's the case, "the market can stay irrational longer than you can stay solvent".

Most bear markets last 18 months or less.  I can handle it.

https://www.ftportfolios.com/Common/ContentFileLoader.aspx?ContentGUID=4ecfa978-d0bb-4924-92c8-628ff9bfe12d

Holy crap that's an awesome graph.  We should sticky that, seriously.  Thank you.

Am I the only one who thinks... "hmmm this forum has only existed in the 'blue' section and never been thru and 'orange'?  So many of us talk a big game, but haven't weathered any real storms.

Right, but that's one of the benefits of this forum - it helps inoculate you against behaving stupidly during  a recession or dip.  I didn't have a huge amount invested in 2008, but I did have some investments, and I did not panic or cash out back then.  I have a lot more $$ invested now, but I also feel much more clear about the need to take the long view and specifically not get caught up in short term gains/losses (especially losses). 

Put another way... I would be at a MUCH higher risk of doing something stupid during the next major dip if I hadn't found MMM in general, and this forum in particular. 

[Exflyboy]

Agreed.. I will never forget the gut wrenching feeling of watching the market crash day after day in 2008.

Eventually I just maxed out my 401k contributions, bought nothing but stock ETF's and turned off the TV.

That was not a fun time.

In 2009 it looked like life was returning..

Then I remember the DOW crossing 15000.. I was still 100% stocks

In September 2013 I realised we were FI.

It was a good lesson about staying invested in the market.

[Retire-Canada]

Except we have actually had threads about who was investing during the Great Recession so I am not sure I buy that no one has weathered any real storms.

Tech Bubble and the GREAT recession here. I didn't enjoy either and I didn't respond optimally [dump every penny I could into more stocks], but I also left my chips in the game and didn't panic. I'm better prepared for the next crash with two under my belt.

[BTDretire]

Except we have actually had threads about who was investing during the Great Recession so I am not sure I buy that no one has weathered any real storms.

 I had a few hundred thousand for the 2000 downturn, BUT, I had a guru,
that said to sell on Feb 11. The market peaked less than a month later and
then had a huge decline.
 My same guru completely missed 2008 and I was down $300k or so.
 Funny, I don't even remember feeling bad about it. Don't recall any fretting about it.

[JAYSLOL]

Yeah, i haven't been (invested) though any major downturn, but I hope that what i've learned here will serve me well when it does happen.  The pre-MMM me would probably have gone all cash at the slightest downturn, then spent everything to be prepared for the apocalypse and never re-invest.  The current me will try to stay the course and refer to the forums when in doubt.  My only wish is that i remain employed during the next recession so i have the funds to keep investing during the dip. 

[Inaya]

I've only been invested since 2014. I have no idea if I have the fortitude to weather a recession--but I'd like to think I do. Regardless, I'm a lot better off having found MMM, since prior to discovering it, I was in the "the stock markets are no better than the lottery" crowd.

[HPstache]

Am I the only one who thinks... "hmmm this forum has only existed in the 'blue' section and never been thru and 'orange'?  So many of us talk a big game, but haven't weathered any real storms.

Except we have actually had threads about who was investing during the Great Recession so I am not sure I buy that no one has weathered any real storms.

Thats why I said "so many" not "all" of us.  I did a poll a month or two ago that show that about 80% of this forum had less than $50k invested during the 2008 downturn.  This includes myself. 

[itchyfeet]

I would be rather shocked if any regular forum contributors sold out of the market after a 20% plus drop, irrespective of a lack of past experience.

Sure, there will always be a crowd of experts trying to pick the top, but selling post crash from this forum's membership, I'd be surprised!! I doubt we would even see that being a topic of discussion.

I am sure there will be a lot of discussion and speculation on how long the market recovery might take - months, years, decades. But at that point what is there to do but take it on the chin ride it out.

Maybe there will be some doomsayers believing the correction is a forerunner to the end of capitalism. I have difficulty imagining the consequences of such an event so choose to discount its plausibility.

[Caoineag]

=
Thats why I said "so many" not "all" of us.  I did a poll a month or two ago that show that about 80% of this forum had less than $50k invested during the 2008 downturn.  This includes myself.

Oh I had less than 50k back then, every contribution was magically smaller when I made it and I was still trying to find more to contribute. But I think my view differs from yours in that the money I had at risk was way more important for me back then. A downturn now would still leave me with a ton of resources and so is less scary. Back then, I had never received free money from my investment returns, now I have received so much that a downturn would be just giving a portion of that back.

Don't get me wrong, I agree that most people overestimate their risk tolerance during boom years. I just think quite a few of us have already been tested on our own tolerance and so have a pretty good idea of what we can handle.

[DavidAnnArbor]

I wish I had forums and information like this during the 2000 - 2003 correction because I would have invested more in the stock market then.
Fortunately what was invested in the stock market was mostly invested in S&P 500 index by that point, with some small amount in actively managed mutual funds that fared really badly.

For the 2008 crash I was better prepared to deal with it having read David Swensen's book for small investors.

But these forums with their wealth of information in real time are even better. So I think there will be threads about what to do if the market crashes. We, the forum members, will be able to help each other out during that psychologically difficult time.

[OurTown]

Isn't this why it is healthy to have a diversified portfolio?  Let's assume I am at 60/40.   Let's further assume you are at 100% stocks.  A 2008 level event, a 50% drop in the market, is a 50% drop in your portfolio and a 30% drop in mine.  Sure, you get more robust growth during the good years, but I'm in my late 40s and I plan on needing the money in my early 50s, so I have less time to recover.  That's the whole point in being at 60/40 rather than 100% stocks.

[DavidAnnArbor]

Isn't this why it is healthy to have a diversified portfolio?  Let's assume I am at 60/40.   Let's further assume you are at 100% stocks.  A 2008 level event, a 50% drop in the market, is a 50% drop in your portfolio and a 30% drop in mine.  Sure, you get more robust growth during the good years, but I'm in my late 40s and I plan on needing the money in my early 50s, so I have less time to recover.  That's the whole point in being at 60/40 rather than 100% stocks.

There was a thread entitled "why would I be in anything but 100% stocks"  There was a great debate on this very issue.

https://forum.mrmoneymustache.com/investor-alley/why-would-i-be-in-anything-other-than-100-stocks/100/

https://forum.mrmoneymustache.com/investor-alley/100-stocks-or-9010/

[Tyson]

Isn't this why it is healthy to have a diversified portfolio?  Let's assume I am at 60/40.   Let's further assume you are at 100% stocks.  A 2008 level event, a 50% drop in the market, is a 50% drop in your portfolio and a 30% drop in mine.  Sure, you get more robust growth during the good years, but I'm in my late 40s and I plan on needing the money in my early 50s, so I have less time to recover.  That's the whole point in being at 60/40 rather than 100% stocks.

Yep.  I do 80/20, but as I get closer to FIRE, I will shift to 60/40 or so for the first few years.  I'll also have a paid off home before I fire.  Honestly if my home is paid off and not at risk of being taken away from not making the monthly mortgage payments, I can survive some pretty damn lean years. 

And no, I'm not paying off my mortgage early - I'm plowing all my $$ into stocks/bonds and will pay off the mortgage in full once I have my FIRE # plus an additional $350k (balance of my mortgage). 

These are things I wouldn't even know about if it weren't for this forum.  But now, not only do I know about it, I also have very solid answers to them. 

[Retire-Canada]

Isn't this why it is healthy to have a diversified portfolio?  Let's assume I am at 60/40.   Let's further assume you are at 100% stocks.  A 2008 level event, a 50% drop in the market, is a 50% drop in your portfolio and a 30% drop in mine.  Sure, you get more robust growth during the good years, but I'm in my late 40s and I plan on needing the money in my early 50s, so I have less time to recover.  That's the whole point in being at 60/40 rather than 100% stocks.

The 100% stock portfolio may go into the 50% crash high enough above the 60/40 portfolio due to better growth that they still come out ahead.  That's something that needs to be considered.

[OurTown]

That's a fair point. 

[MrGreen]

Read an article quoting Robert Schiller today. It was mentioned that the market is up 22% since Election Day. So it would take an 18% drop just to take us back to Election Day levels.

[Tonyahu]

Read an article quoting Robert Schiller today. It was mentioned that the market is up 22% since Election Day. So it would take an 18% drop just to take us back to Election Day levels.

Man I am young and inexperienced but if that doesn't scream OVERBOUGHT I don't know what does...

[Clean Shaven]

via Imgflip Meme Generator

[MrGreen]

Read an article quoting Robert Schiller today. It was mentioned that the market is up 22% since Election Day. So it would take an 18% drop just to take us back to Election Day levels.

Man I am young and inexperienced but if that doesn't scream OVERBOUGHT I don't know what does...

Not necessarily. Some years markets go up 30+%. Happens fairly often.

[Radagast]

Read an article quoting Robert Schiller today. It was mentioned that the market is up 22% since Election Day. So it would take an 18% drop just to take us back to Election Day levels.

Man I am young and inexperienced but if that doesn't scream OVERBOUGHT I don't know what does...

By itself, that is meaningless because that kind of return happens frequently over that kind of period. The other issue is that OVERBOUGHT is a relative term: you must then specify what it is overbought in comparison to. Therein lies the challenge.

[Tyson]

Read an article quoting Robert Schiller today. It was mentioned that the market is up 22% since Election Day. So it would take an 18% drop just to take us back to Election Day levels.

Man I am young and inexperienced but if that doesn't scream OVERBOUGHT I don't know what does...

Well I guess you better get out now :D

[Mr Mark]

Read an article quoting Robert Schiller today. It was mentioned that the market is up 22% since Election Day. So it would take an 18% drop just to take us back to Election Day levels.

Man I am young and inexperienced but if that doesn't scream OVERBOUGHT I don't know what does...

By itself, that is meaningless because that kind of return happens frequently over that kind of period. The other issue is that OVERBOUGHT is a relative term: you must then specify what it is overbought in comparison to. Therein lies the challenge.

Exactly. Right now central banks are flooding the world with money in the hope of stimulating inflation and growth, not very successfully.

There's nowhere for the cash to go so it's chasing yield. Even if there's a big sell off in the US equity market, eventually it'll have to return like the tide.

[Cache_Stash]

Read an article quoting Robert Schiller today. It was mentioned that the market is up 22% since Election Day. So it would take an 18% drop just to take us back to Election Day levels.

Man I am young and inexperienced but if that doesn't scream OVERBOUGHT I don't know what does...

This is an inexperienced comment, as well.  How much have earnings grown during the period?  Do you know without looking it up?

[PathtoFIRE]

Exactly. Right now central banks are flooding the world with money in the hope of stimulating inflation and growth, not very successfully.

There's nowhere for the cash to go so it's chasing yield. Even if there's a big sell off in the US equity market, eventually it'll have to return like the tide.

Is it a flood, or were they just stingy with the money supply before, and no we are entering a (somewhat)  more rational age of monetary policy?

[Tyson]

Exactly. Right now central banks are flooding the world with money in the hope of stimulating inflation and growth, not very successfully.

There's nowhere for the cash to go so it's chasing yield. Even if there's a big sell off in the US equity market, eventually it'll have to return like the tide.

Is it a flood, or were they just stingy with the money supply before, and no we are entering a (somewhat)  more rational age of monetary policy?

Don't you know, any and all changes that result in positive returns are actually BAD and are the forebear of DOOM!!!!  TOP IS IN!!!! 

[/sarcasm]

[OurTown]

Top esta en.
Top est en.
В верхней части
الأعلى في
顶部在

[dougules]

Exactly. Right now central banks are flooding the world with money in the hope of stimulating inflation and growth, not very successfully.

There's nowhere for the cash to go so it's chasing yield. Even if there's a big sell off in the US equity market, eventually it'll have to return like the tide.

Is it a flood, or were they just stingy with the money supply before, and no we are entering a (somewhat)  more rational age of monetary policy?

It's only rational if inflation is going to be lower than it had been from here on out.  I think interest rates will have to go back up, but I have no idea when it will happen or how it will play out.  I'm not Warren Buffett.  I don't have the expertise, time, patience, and resources to outthink millions of other folks.  I'm just going to keep riding on their coat tails and buy at the prices they set.  The top won't really be in until the world ends anyway.  (Looks like that will be Saturday, though). 

[Monocle Money Mouth]

Top esta en.
Top est en.
В верхней части
الأعلى في
顶部在

So what are you trying to say here?

[Stache-O-Lantern]

Read an article quoting Robert Schiller today. It was mentioned that the market is up 22% since Election Day. So it would take an 18% drop just to take us back to Election Day levels.

Man I am young and inexperienced but if that doesn't scream OVERBOUGHT I don't know what does...

By itself, that is meaningless because that kind of return happens frequently over that kind of period. The other issue is that OVERBOUGHT is a relative term: you must then specify what it is overbought in comparison to. Therein lies the challenge.

Exactly. Right now central banks are flooding the world with money in the hope of stimulating inflation and growth, not very successfully.

There's nowhere for the cash to go so it's chasing yield. Even if there's a big sell off in the US equity market, eventually it'll have to return like the tide.

I understand the U.S. central bank is starting to sell the securities it purchased during the years of quantitative easing, which i think is the opposite of flooding the world with money.  Granted, i don't think they have really started yet, and perhaps other central banks are doing the opposite.  I do know why the Fed is selling its securities though, it's because they know the TOP IS IN, and they are getting out while the getting is good.  Which brings me to my main point:  I don't like the "almost serious" turn this thread is taking here.  If we're not careful, this thread could devolve into some kind of intelligent discussion.

[wienerdog]

Fear is back, VIX above 15, XIV breaking down. SPY to follow, earnings will be a reality check.

mrpercentage, is that you?

I still think this is the best response!  The more I watch this thread I think aspiringnomad might have hit the nail on the thread. 

[Retire-Canada]

I understand the U.S. central bank is starting to sell the securities it purchased during the years of quantitative easing, which i think is the opposite of flooding the world with money.

They bought bonds. They are not selling anything. They just planing in the future to let the bonds expire and not buy more bonds to replace them. The plan is being rolled out slowly so that markets don't get freaked out.

[Stache-O-Lantern]

I understand the U.S. central bank is starting to sell the securities it purchased during the years of quantitative easing, which i think is the opposite of flooding the world with money.

They bought bonds. They are not selling anything. They just planing in the future. To let the bonds expire and not buy more bonds to replace them. The plan is being rolled out slowly so that markets don't get freaked out.

I see, i knew it was bonds, but i thought they were actually going to start selling some.

So you're saying the TOP IS IN on bonds, instead of the S&P500?  Makes sense, bond yields are still pretty low right now.

[frugalnacho]

All tops are in.  We are at the top of the top.

[solon]

Do you ever just stare at the ticker, mentally willing it to go higher? Not that I do that. #askingforafriend

[MrGreen]

Top o' the top to ya!

[secondcor521]

Top of the muffin to ya!

https://lovelace-media.imgix.net/uploads/501/ca9c21b0-b6d2-0132-9a56-0e01949ad350.jpg?w=740&h=555&fit=crop&crop=faces&auto=format&q=70

[DavidAnnArbor]

The top really was in.

When Trump fired Yellen. And replaced her with a crank, Kevin Warsh, an anti-inflationer, who cranked up interest rates. The recession began, the markets tanked. There's no end in sight until he is replaced in 4 years.

http://www.reuters.com/article/us-usa-fed/yellens-stock-rises-as-she-leads-fed-from-crisis-era-policy-idUSKCN1BW2LT
http://www.politico.com/story/2017/09/20/federal-reserve-chair-warsh-kevin-242901

[Mr Mark]

The top really was in.

When Trump fired Yellen. And replaced her with a crank, Kevin Warsh, an anti-inflationer, who cranked up interest rates. The recession began, the markets tanked. There's no end in sight until he is replaced in 4 years.

http://www.reuters.com/article/us-usa-fed/yellens-stock-rises-as-she-leads-fed-from-crisis-era-policy-idUSKCN1BW2LT
http://www.politico.com/story/2017/09/20/federal-reserve-chair-warsh-kevin-242901

Oh god if only that wasn't too close to being possible  David AA!

And when he then put us back on the gold standard things got super crazy.

[Paul der Krake]

And when he then put us back on the gold standard things got super crazy.

Breaking: White House to announce the immediate dissolution of the Federal Reserve, to be replaced by the ICO Committee for TrumpCoin, the newest and greatest cryptocurrency slated to replace the Dollar. Individuals familiar with the transition plan say that the new currency will be pegged at the price of a Signature Suite at a rotating selection of Trump Hotels.

[anisotropy]

The top really was in.

When Trump fired Yellen. And replaced her with a crank, Kevin Warsh, an anti-inflationer, who cranked up interest rates. The recession began, the markets tanked. There's no end in sight until he is replaced in 4 years.

http://www.reuters.com/article/us-usa-fed/yellens-stock-rises-as-she-leads-fed-from-crisis-era-policy-idUSKCN1BW2LT
http://www.politico.com/story/2017/09/20/federal-reserve-chair-warsh-kevin-242901

I know more than one person that are counting for it to happen, oh man that would be the run and crash of our generation. We would make millions, no, tens of millions off the deplorables. Truly a president we deserve! High-five!

[JAYSLOL]

And when he then put us back on the gold standard things got super crazy.

Breaking: White House to announce the immediate dissolution of the Federal Reserve, to be replaced by the ICO Committee for TrumpCoin, the newest and greatest cryptocurrency slated to replace the Dollar. Individuals familiar with the transition plan say that the new currency will be pegged at the price of a Signature Suite at a rotating selection of Trump Hotels.

I'm genuinely amazed that Trump hasn't already tried to do this.  (in Donald Trump voice) "TrumpCoin is the greatest money ever created.  Really great.  Terrific.  People love TrumpCoin.  Everybody tells me it's the greatest.  We're replacing the corrupt globalist American Dollar with a great new money that puts Me.. er I mean America first.  Really Terrific, thank you." 

[BTDretire]

Trump haters should be willing to donate all this years gains to the democrat party.
https://my.democrats.org/page/contribute/donate-to-help-democrats-today

[Retire-Canada]

Trump haters should be willing to donate all this years gains to the democrat party.

Because he didn't F-up Obama's policies too much and wreck the stock market? I'm not sure I see the point? Because as I recall a Republican left the markets in tatters and Obama inherited the ruins and turned it around in a huge bull market. Now Trump gets far less accomplished than anyone expected and hasn't achieved the carnage in the markets folks feared because we are basically still running on Obama's steam. That's nothing I would get to proud of if I was a Trump fan.

[anisotropy]

Trump haters should be willing to donate all this years gains to the democrat party.
https://my.democrats.org/page/contribute/donate-to-help-democrats-today

There are two camps of "investors": those that bought into "Trump Trade" bs and those that know better.

https://pbs.twimg.com/media/DKQfT0XV4AEufAb.jpg:large

And for the record, I am a hateful person in general, I look down on people. To me, people exist to make me money. But God Emperor Trump is clearly beyond me in every way.

He commanded the Storm (Irma) to pivot at the last moment and preserved the South White House we all came to love and worship.

He commanded the Earth to rise up (earthquake at nuke site) beneath the young "Rocket Man" to teach him a lesson.

He will soon rain Fire (as he vowed FIRE AND FURY) on his enemies and the families of his enemies.

Storm, Earth, and Fire. The power of Trump.
https://www.youtube.com/watch?v=I3qwcxLIzvM

*edit: apparently I had mistaken Harvey for Irma

[theolympians]

Trump haters should be willing to donate all this years gains to the democrat party.
https://my.democrats.org/page/contribute/donate-to-help-democrats-today

+1

[Tyson]

Trump haters should be willing to donate all this years gains to the democrat party.
https://my.democrats.org/page/contribute/donate-to-help-democrats-today

+1

Presidents should not be judged by what happens to the economy at the beginning of their term, but rather the state of the economy at the end. 

[dividendman]

Can we keep this thread on topic please? This thread is about the Top being in and how the market can only go down from here.

[BTDretire]

Can we keep this thread on topic please? This thread is about the Top being in and how the market can only go down from here.

 Just trying to get Hillary some funding for her next campaign!

[JAYSLOL]

Can we keep this thread on topic please? This thread is about the Top being in and how the market can only go down from here.

Of course, we all know the markets can go nowhere but down, never mind Warren Buffett recently predicted the Dow will be over 1M in 100 years, it's time to sell everything, short stocks and climb into the fallout shelters. 

https://www.cnbc.com/video/2017/09/21/warren-buffett-predicts-the-dow-will-hit-1-million.html?play=1