View Full Version : Have you noticed that the stock market is down a bit?
DMHinCO
10-09-2008, 11:26 PM
I have, and it is making me grumpy and uneasy.
My wife and I are savers. A year ago, I felt like we were close to having enough to retire on at 65 even if we didn't save any more during the 20 years until then.
We live in the same house we bought 13 years ago and our payments are low. We don't buy toys. We don't go on extravagant vacations. We drive a 2004 Honda van and a 1996 Nissan.
I expected to be able to begin to save for our kids' education soon.
But now I feel nervous about our financial picture. Not worried about food on the table, but worried about, well, je ne sais quoi. It just seems that a couple like us who scrimps and saves in order to be responsible parents and citizens should be better positioned than we are.
My business produces a nice income, but there is no way it is throwing off enough profit to offset my stock market losses.
And I am discerning malaise, irritability and insecurity in my friends too.
Are other people able to roll with this better?
lordrichter
10-09-2008, 11:33 PM
Very soon there will be a lot of people getting rich off of the stock market.
leahn
10-09-2008, 11:46 PM
DMH,
Your post rings a nerve with me, just in that people like I, Aindik, pdjPlano, keep saying that it is broken, that there is no way a happy family (non party-members) can make it today. Too, many, forces, dragging at you, and the Government, is only hurting.
You need to wake upand realize that it is not stock market losses, but it is the Government that keeps you down.
-John
JustAllie
10-09-2008, 11:51 PM
I have, and it is making me grumpy and uneasy.
My wife and I are savers. A year ago, I felt like we were close to having enough to retire on at 65 even if we didn't save any more during the 20 years until then.
We live in the same house we bought 13 years ago and our payments are low. We don't buy toys. We don't go on extravagant vacations. We drive a 2004 Honda van and a 1996 Nissan.
I expected to be able to begin to save for our kids' education soon.
But now I feel nervous about our financial picture. Not worried about food on the table, but worried about, well, je ne sais quoi. It just seems that a couple like us who scrimps and saves in order to be responsible parents and citizens should be better positioned than we are.
My business produces a nice income, but there is no way it is throwing off enough profit to offset my stock market losses.
And I am discerning malaise, irritability and insecurity in my friends too.
Are other people able to roll with this better?
It's irksome and worrisome, yes.
But you have 20 years to recover.
And if push comes to shove, your kids can pay for their own college education.
I know it's frustrating, but unless you have some reason why you have to cash in your entire retirement savings today, you haven't "lost" all the money yet.
leahn
10-09-2008, 11:56 PM
Thank you for your input, party member, comrade, Allie.
-John
keirgrey
10-10-2008, 12:29 AM
DMH, folks like Allie, who make their money by the Government, for the Government, want you to know how stupid you are. Lose money, work for 20 years and make your money back, if you are lucky, you dumb shit.
Allie, will decide what is best for you. Allie, will decide if your neighbor should have your house, because he deserves it more.
Allie, party member, block captain.
-JohnUncalled for, John. Allie did not say or even imply anything of the sort.
Markets go up. Markets go down. As was already stated earlier, some are going to get very rich in the stock market.
leahn
10-10-2008, 12:32 AM
It's my impression, Keir.
You will not speak for me, no matter what Government you support.
I can speak, today.
-John
keirgrey
10-10-2008, 12:34 AM
I am NOT speaking for you and you should not presume to speak for Allie. She said what I said, essentially. There is NO reason for him to panic and pull all his money out of the market right now.
leahn
10-10-2008, 12:34 AM
And she did,say, (with some poetic/political license), everything I attributed to her.
-John
keirgrey
10-10-2008, 12:34 AM
And she did,say, (with some poetic/political license), everything I attributed to her.
-JohnAhh. Your perception is clouded, then. Your poetic license needs to be revoked.
leahn
10-10-2008, 12:35 AM
There is plenty of reason to pull your money out of the market, RIGHT NOW, Keir.
That you choose to believe Allie, and say there is NOT, is telling.
Maybe you should look at that, and not attack me.
-John
keirgrey
10-10-2008, 12:38 AM
Perhaps your perception is wrong again. Unsurprisingly.
InigoMontoya
10-10-2008, 12:51 AM
No offense intended to those who are losing money, but I'm enjoying all this to a certain extent.
For years I've heard people tell me how I'm a total moron for putting extra money into the mortgage. They went on and on about how I could earn so much more money if that money were to be put on the market. I mentioned the fact that a dollar spent on the principle of the loan was *guarenteed* money in my pocket (via reduction of future interest payments) while the market was a gamble. They would roll their eyes at me and go on and on about how the market would NEVER go down that much, blah blah blah....
So yeah, I'm loving the fact that even in the face of all of this, my mortgage is still just a few months away from paid off. The pending Economic Doom won't change that.
Have I lost money in the market? Probably $20-30k... But it's not nearly as bad as it would have been had I listened to the experts. Had I listened to them my losses would probably be more like $80k and I'd still have 15 years left on my house (instead of 7 months).
leahn
10-10-2008, 12:57 AM
Way to go, Inigo.
My first (gut) feel has always been to pay off my debts first, but when forked tongues start telling you how you can do better making 7% and then paying your 5%, you try to listen, understand, even if it is against the gut.
Gut, should be listened too, more often.
-John
TheIndependent
10-10-2008, 01:01 AM
I mentioned the fact that a dollar spent on the principle of the loan was *guarenteed* money in my pocket (via reduction of future interest payments) while the market was a gamble
it's not guaranteed. ask those folks in CA who had their values drop by huge amounts. it's LIKELY money in your pocket, but houses can and do drop in value from time to time.
Agatha
10-10-2008, 01:03 AM
I mentioned the fact that a dollar spent on the principle of the loan was *guarenteed* money in my pocket (via reduction of future interest payments) while the market was a gambleit's not guaranteed. ask those folks in CA who had their values drop by huge amounts. it's LIKELY money in your pocket, but houses can and do drop in value from time to time.
Considering we ARE those folks in CA whose home went down by a huge amount. However, it's still worth more than we paid for it at this point. We didn't move to a new, bigger house, due to the inflated market. We could see it going up in huge leaps and bounds and we stayed completely out of it. It was a bit tempting, since the value of our home tripled, but it's probably only worth double what we paid for it at this point. If it makes it back down to what we paid for it? No big deal. We don't have an equity loan against it, so we haven't lost any money.
InigoMontoya
10-10-2008, 01:05 AM
it's not guaranteed. ask those folks in CA who had their values drop by huge amounts. it's LIKELY money in your pocket, but houses can and do drop in value from time to time.
Sure it is.
The value of the house is not guaranteed which in turn means that an investment in real estate is not guaranteed.
But paying off a mortgage IS guaranteed. Whether the housing market (or any other market) goes up or down has no effect on whether or not you have to pay off that money. You DO have to pay it off. As long as this is the case, paying off $1 of principle now is GUARANTEED to result in a reduction of future interest payments.
JYoung
10-10-2008, 01:16 AM
Thank you for your input, party member, comrade, Allie.
-John
DMH, folks like Allie, who make their money by the Government, for the Government, want you to know how stupid you are. Lose money, work for 20 years and make your money back, if you are lucky, you dumb shit.
Allie, will decide what is best for you. Allie, will decide if your neighbor should have your house, because he deserves it more.
Allie, party member, block captain.
-John
It's my impression, Keir.
You will not speak for me, no matter what Government you support.
I can speak, today.
-John
And she did,say, (with some poetic/political license), everything I attributed to her.
-John
You're so full of crap that it's not funny.
She said nothing of the sort and maybe if you'd put down the bottle for a while, you'd actually see that.
leahn
10-10-2008, 01:21 AM
Ya think?
-John
Ya think?
-John
What happened to you that made you like this?
-smak-
pseudonym
10-10-2008, 06:07 AM
Ya think?
-John
What happened to you that made you like this?
Failure + alcohol = bitter.
JustAllie
10-10-2008, 07:38 AM
Holy cow.
What odd things happen after I go to sleep at night.
Mysteryman
10-10-2008, 08:10 AM
DMH, folks like Allie, who make their money by the Government, for the Government, want you to know how stupid you are. Lose money, work for 20 years and make your money back, if you are lucky, you dumb shit.
Allie, will decide what is best for you. Allie, will decide if your neighbor should have your house, because he deserves it more.
Allie, party member, block captain.
-John
Not that she doesn't have the brains for it, but I just don't see Allie as a member of some government level Illuminati. She's way to nice a person.
I don't know what shade of glasses you're wearing, but you may want to have them checked. They make you look not very smart.
lordrichter
10-10-2008, 08:10 AM
Holy cow.
What odd things happen after I go to sleep at night.
What. You did not know you were the spawn of the devil?
;)
keirgrey
10-10-2008, 08:28 AM
Holy cow.
What odd things happen after I go to sleep at night.Indeed, you elitist she-devil. We got your back, though. ;)
grondramb
10-10-2008, 08:35 AM
Cheerful news this morning.
Rumor is the reason that the government is extending the bailout to non-bank commercial paper was to keep GE from going under.
Fox asked their analysts specifically what stocks to buy today and the only concrete answer was the guy who said he is shorting Sears because "its likely they won't make it through this."
Every one of the world reports - U.K, Iceland, Ireland, Australia used the word "depression" but in each case said it wasn't the right word.
A contrarian would say this is when you expect the big rebound.
Faerie
10-10-2008, 10:59 AM
Sears has been on a death spiral for a while... it wouldn't surprise me if they went under.
On the plus side, I'll be starting my new 401K in January. Just the right length of time to watch and see how things go, but if the market continues this way, I'll still be buying while prices are down.
grondramb
10-10-2008, 11:18 AM
Iceland's government took over three banks with 6 times the assets of their GDP and now the country may go bankrupt
http://pics.ebaystatic.com/aw/pics/globalAssets/ltCurve.gif
Country for sale: ICELAND - 99p start price no reserve
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DMHinCO
10-10-2008, 11:45 AM
So maybe joining a militia, living off the grid on a compound, subsisting on non-subsidized corn liquor might work for some of you. ;) Or one of you, perhaps. It's not my style.
I used to pay additional principal on my mortgage, but I stopped. Obviously in retrospect, that money would have made me 6% rather than losing 30%. Inigo, the current situation vindicates you.
What's the expression around here? Booze and hookers? Market plunges like the past year reward those who have splurged instead.
But I am scared.
I do think a good financial move right now would be to have large debts rather than low debts so I can pay it back after the inevitable inflation that is coming.
Anyway, I used to feel a bit satisfied, maybe proud, maybe smug about my financial position. Today I feel anxiety.
A dad on my kid's soccer team is a psychologist and he said I'm not alone.
busyba
10-10-2008, 12:05 PM
I mentioned the fact that a dollar spent on the principle of the loan was *guarenteed* money in my pocket (via reduction of future interest payments) while the market was a gamble
it's not guaranteed. ask those folks in CA who had their values drop by huge amounts. it's LIKELY money in your pocket, but houses can and do drop in value from time to time.
Your house value can drop to zero, but if you're living in it and don't plan to move out anytime soon, it doesn't really matter, does it?
grondramb
10-10-2008, 12:08 PM
Your house value can drop to zero, but if you're living in it and don't plan to move out anytime soon, it doesn't really matter, does it?
People also make a similar argument about long term stock and bond holdings too - in a way the price only matters at sale.
The wealth effect (http://en.wikipedia.org/wiki/Wealth_effect), however, shows that belief about wealth, not just cash on hand or cash flow effects behavior.
busyba
10-10-2008, 12:09 PM
And yeah, I'm so glad that I'm not in the market at all.
I've got some (not much) money in a 401(k) that's probably evaporated in value, but none of that money ever came out of my pocket; it was free contributions by my employer of the time, so I don't even consider that a loss, just a reduction in the amount of free money that I'd be shocked to live long enough to see anyway. :)
busyba
10-10-2008, 12:11 PM
Your house value can drop to zero, but if you're living in it and don't plan to move out anytime soon, it doesn't really matter, does it?
People also make a similar argument about long term stock and bond holdings too - in a way the price only matters at sale.
The wealth effect (http://en.wikipedia.org/wiki/Wealth_effect), however, shows that belief about wealth, not just cash on hand or cash flow effects behavior.
True, but unlike stock and bond holdings, your house has utility for you that goes beyond it's sale value: shelter, among other things.
grondramb
10-10-2008, 12:24 PM
Not encouraging...
Italian Prime Minister Berlusconi said political leaders discussing idea of closing world's financial markets while they 'rewrite the rules of international finance'... MORE
http://ichart.finance.yahoo.com/instrument/1.0/%5EDJI/chart;range=1d/image;size=239x110
DOW DROPS 600 AT OPEN; SWINGS UP... (http://biz.yahoo.com/ap/081010/wall_street.html)
Bush says anxiety feeding market instability... (http://apnews.myway.com/article/20081010/D93NN3T00.html)
EUROPE STOCK ROUT... (http://finance.yahoo.com/intlindices?e=europe)
London shares bloodbath... (http://business.timesonline.co.uk/tol/business/markets/article4917855.ece)
Carter slams Bush on market crisis... (http://www.reuters.com/article/topNews/idUSTRE4993TS20081010?feedType=RSS&feedName=topNews&rpc=22&sp=true)
WASH POST: The End Of American Capitalism? (http://www.washingtonpost.com/wp-dyn/content/article/2008/10/09/AR2008100903425_pf.html)
My personal Jeopardy (both game show and somewhat literal):
($64,342.91)
What is the amount of loss as of Wednesday in my current 401K retirement account for 2008?
Fortunately, it doesn't really upset me since I'm not planning on retiring anytime soon and it'll work itself out in the end. I have very little of our current assets in stocks (just employment incentives), so at least I'm not directly affected by what's going on.
Mysteryman
10-10-2008, 03:23 PM
I contribute a good portion of my income to my retirement funds. Like everyone elses, the value of accounts is falling alot. I'm not worried in the least. I have decades before retirement. I may make some money from selling my old car which I'm seriously thinking about dumping into my IRA.
No is not the time to sell, but the time to buy. :)
Faerie
10-10-2008, 03:28 PM
I contribute a good portion of my income to my retirement funds. Like everyone elses, the value of accounts is falling alot. I'm not worried in the least. I have decades before retirement. I may make some money from selling my old car which I'm seriously thinking about dumping into my IRA.
No is not the time to sell, but the time to buy. :)
This is why I'm excited about my 401K start coming up. I'm trying to make it so I can put a good amount of cash in near the start to take advantage of things while they're low... I can't believe when I hear about people pulling their money out and putting it in savings accounts or MM accounts. If you don't need the money right now, just let it be.
grondramb
10-10-2008, 03:30 PM
The dow is up 700 points from the low today on very heavy volume.... hmmm
If its over it only cost us having the government backstop basically everything.
grondramb
10-10-2008, 03:34 PM
http://ichart.finance.yahoo.com/b?s=%5EDJI
Edit: From down 700 to up almost 300 now
Edit #2: That was 400 points back down awfully fast.
For those of you who say that you're far from retirement so you're not worried:
I have contributed $132,000 to my 401K account over the 14 years I've been with my company. The current value of those contributions is $143,000. My company match amounted to $66,000 over that period. The current value of those funds is $67,000. 14 years is a long time. I made no money in those 14 years, and I'm surely not atypical. I might make some money in the next 14 years, but over the 28-year period (the past 14 and the coming 14) my average annual returns are likely to be in the low single-digits. And as I approach retirement I will likely shift my investments away from stocks, further dampening my gains.
Have those of you who say "I have a long time until retirement" actually looked at the numbers and done a similar analysis? It's likely that I would have done well to have just been in the money market for the whole 28 years. I won't know that for 14 years, but I do know that being in the stock market for the last 14 was a mistake. I'll bump this thread in 2022 and let you know how things turned out for me.
Mysteryman
10-10-2008, 04:35 PM
For those of you who say that you're far from retirement so you're not worried:
I have contributed $132,000 to my 401K account over the 14 years I've been with my company. The current value of those contributions is $143,000. My company match amounted to $66,000 over that period. The current value of those funds is $67,000. 14 years is a long time. I made no money in those 14 years, and I'm surely not atypical. I might make some money in the next 14 years, but over the 28-year period (the past 14 and the coming 14) my average annual returns are likely to be in the low single-digits. And as I approach retirement I will likely shift my investments away from stocks, further dampening my gains.
Have those of you who say "I have a long time until retirement" actually looked at the numbers and done a similar analysis? It's likely that I would have done well to have just been in the money market for the whole 28 years. I won't know that for 14 years, but I do know that being in the stock market for the last 14 was a mistake. I'll bump this thread in 2022 and let you know how things turned out for me.
I just want to make sure I understand. You're saying it was a mistake because of the value of your accounts right now? I'm not making fun of you, but if I'm reading you right this seems silly.
How about 6 months ago, were you "up"?
When you're at the low point is not the time to evaluate if your stock purchase were worth it. As you get closer to retirement, you should do exactly as you're planning and move more into bonds or Tbills, but stocks are what you want for high yield when you can afford the risk.
I just want to make sure I understand. You're saying it was a mistake because of the value of your accounts right now? I'm not making fun of you, but if I'm reading you right this seems silly.
How about 6 months ago, were you "up"?Hindsight lets me see that being in the stock market for the last 14 years did nothing for me. In retrospect, it was a mistake. I don't see how you can disagree with that, assuming that you know what "mistake" means.
Yes, 6 months ago I had made money. I don't see how it matters. It has nothing to do with where I am today. You should always ask yourself, "Where would I invest this money if I had a lump sum to invest today?" If the answer is something different than where the money is currently invested, you should move it. Looking back and remembering that I used to have $350,000 in this account is not a factor in any decision I make today.
When you're at the low point is not the time to evaluate if your stock purchase were worth it. As you get closer to retirement, you should do exactly as you're planning and move more into bonds or Tbills, but stocks are what you want for high yield when you can afford the risk.But that's the point - I have taken the risk over the last 14 years and it got me nothing. If the next 14 years provide reasonable average returns, say 7%, I will have taken that risk for 28 years and have no more to show for it than if I had just been in the money market for 28 years. People keep saying that they're in it for the long term - I often wonder whether they really understand what they're saying or if they're just parroting Fidelity's marketing materials or Suze Orman's books.
One of my 401k's dropped by 40% over the last 2 weeks. I'm not worried about it. In fact, I just shifted a bunch of cash from a fund that did reasonably okay into a fund that lost quite a lot of its value. When they rise up again to their previous levels (or even close to them), then I'll make a killing.
Of course, they were overvalued to begin with, some of them. I mean, you can't keep up 20% growth per year forever.
Mysteryman
10-10-2008, 09:01 PM
I just want to make sure I understand. You're saying it was a mistake because of the value of your accounts right now? I'm not making fun of you, but if I'm reading you right this seems silly.
How about 6 months ago, were you "up"?Hindsight lets me see that being in the stock market for the last 14 years did nothing for me. In retrospect, it was a mistake. I don't see how you can disagree with that, assuming that you know what "mistake" means.
Yes, 6 months ago I had made money. I don't see how it matters. It has nothing to do with where I am today. You should always ask yourself, "Where would I invest this money if I had a lump sum to invest today?" If the answer is something different than where the money is currently invested, you should move it. Looking back and remembering that I used to have $350,000 in this account is not a factor in any decision I make today.
So we could more accurately say that these stocks made you money for 13.5 years and you've lost money in the last 6 months.
When you're at the low point is not the time to evaluate if your stock purchase were worth it. As you get closer to retirement, you should do exactly as you're planning and move more into bonds or Tbills, but stocks are what you want for high yield when you can afford the risk.But that's the point - I have taken the risk over the last 14 years and it got me nothing. If the next 14 years provide reasonable average returns, say 7%, I will have taken that risk for 28 years and have no more to show for it than if I had just been in the money market for 28 years. People keep saying that they're in it for the long term - I often wonder whether they really understand what they're saying or if they're just parroting Fidelity's marketing materials or Suze Orman's books.
You should always be comfortable with the amount of risk you're taking with your retirement planning. It sounds like you've taken more risk than you're comfortable with if you regret the outcome. I think it would be an extremely costly mistake to cash in the value of your stocks now, when the market is at a historic low especially if you don't need the money immediately.
I won't fault you for it though, because I believe you need to be able to sleep at night and not worry about the status of these accounts. Good luck.
I think it would be an extremely costly mistake to cash in the value of your stocks now, when the market is at a historic low especially if you don't need the money immediately.That's another one. "The market is at a historic low." No, it's not, unless you cherry pick your data. A good number of people say it's still too high. A historic low would be if it went to zero. That has never happened before, but every number between 1 and 14,000 has been hit. "Historic low" is supposed to mean that it has never been this low before. It's a recent low, for some definition of recent.
Answer honestly: When the Dow was at 12,000, did you think it was a buying opportunity? Were "stocks on sale"? People said that at 12,000. They said it at 11,000. They said it at 10,000. Nobody will know whether where we are is a low point for quite some time. It's as likely that I'm right and it will go much lower as it is that you're right and this is near the bottom.
And here's another thing. The only reason that I haven't actually lost money in my 401K over the last 14 years is that I dumped some stock funds at 12,000 and some more at 11,000. I've been right twice more than buy-and-holders so far. I'm betting that I'm right again. History will show that buy-and-holders got their asses handed to them while the people who told them to do it made a fortune in fees.
DMHinCO
10-10-2008, 10:43 PM
I'm trying to repeat my mantra. If the market goes down seven percent per day, it will never get to zero. :)
Mikkel_Knight
10-11-2008, 04:05 PM
Yes, 6 months ago I had made money. I don't see how it matters. It has nothing to do with where I am today. You should always ask yourself, "Where would I invest this money if I had a lump sum to invest today?" If the answer is something different than where the money is currently invested, you should move it. Looking back and remembering that I used to have $350,000 in this account is not a factor in any decision I make today.
You couldnt' be more wrong...
The question to ask is this:
"What do I want to gain from investing this lump sum of money, and to what degree am I willing to risk the investment to attain that goal?"
THAT is the correct question to ask...
grondramb
10-11-2008, 04:17 PM
I'm trying to repeat my mantra. If the market goes down seven percent per day, it will never get to zero. :)
Prices are actually quantized -
trainman
10-11-2008, 08:12 PM
Anyone else here work at a company that has their stock price right at the top of the intranet home page? Gosh, it's been fun watching the chance of layoffs increase on a minute-by-minute basis.
Yes, 6 months ago I had made money. I don't see how it matters. It has nothing to do with where I am today. You should always ask yourself, "Where would I invest this money if I had a lump sum to invest today?" If the answer is something different than where the money is currently invested, you should move it. Looking back and remembering that I used to have $350,000 in this account is not a factor in any decision I make today.
You couldnt' be more wrong...
The question to ask is this:
"What do I want to gain from investing this lump sum of money, and to what degree am I willing to risk the investment to attain that goal?"
THAT is the correct question to ask...THAT is the same question, assuming that after answering the two parts of your question you actually choose somewhere to put the money. So if I couldn't be more wrong you couldn't be more wrong either.
Mikkel_Knight
10-12-2008, 12:28 PM
Yes, 6 months ago I had made money. I don't see how it matters. It has nothing to do with where I am today. You should always ask yourself, "Where would I invest this money if I had a lump sum to invest today?" If the answer is something different than where the money is currently invested, you should move it. Looking back and remembering that I used to have $350,000 in this account is not a factor in any decision I make today.
You couldnt' be more wrong...
The question to ask is this:
"What do I want to gain from investing this lump sum of money, and to what degree am I willing to risk the investment to attain that goal?"
THAT is the correct question to ask...THAT is the same question, assuming that after answering the two parts of your question you actually choose somewhere to put the money. So if I couldn't be more wrong you couldn't be more wrong either.
Um. No.
You fail at reading comprehension.
Try again.
You couldnt' be more wrong...
The question to ask is this:
"What do I want to gain from investing this lump sum of money, and to what degree am I willing to risk the investment to attain that goal?"
THAT is the correct question to ask...THAT is the same question, assuming that after answering the two parts of your question you actually choose somewhere to put the money. So if I couldn't be more wrong you couldn't be more wrong either.
Um. No.
You fail at reading comprehension.
Try again.'Splain it to me real slow.
Mysteryman
10-13-2008, 04:31 PM
Gus, the DOW jumped over 900 points today. Does this change any of your thoughts you posted late last week?
Gus, the DOW jumped over 900 points today. Does this change any of your thoughts you posted late last week?No. It's one day out of 14 years. My average annual return over that period is still miniscule even including today's gains.
I may have given the impression that I bailed on stocks completely, but that's not the case. I moved a portion of my 401K to cash at 12,000, another portion at 11,000, and another portion on Friday. I still have a significant amount of money in stocks.
DMHinCO
10-15-2008, 05:48 PM
SSDD.
http://www.fool.com/investing/dividends-income/2008/10/15/fool-blog-another-day-another-787.aspx?source=ihprlklca0000001
Ouch.
Agatha
10-20-2008, 10:22 PM
I finally looked at how much I lost - about 20%.
DMHinCO
10-20-2008, 10:47 PM
Since the peak in October 2007? If it was only 20%, count yourself fortunate.
Agatha
10-20-2008, 11:31 PM
Since the peak in October 2007? If it was only 20%, count yourself fortunate.
Oh, I didn't look that far back. Just in the last month, though, I lost about 20%.
Gus, the DOW jumped over 900 points today. Does this change any of your thoughts you posted late last week?The Dow has lost those 900 points and another 15% or so since your post. Yet I still read stories saying that it's a good time to buy and buy-and-holders are still sticking to their guns even though they have made no money with that strategy in the last decade (they would have had you believe that 10 years was long term). At what point will people open their eyes to the reality?
The Dow will continue to fall because more and more people are seeing the light. If you want to ride it to the bottom, good luck. Note that the best investors (Warren Buffett, for one notable example) do not buy and hold. They try to buy low and sell high. Buffett is on record as having sold when the Dow was near its highs in 2007. Buy-and-hold ignores the all-important "sell high" part of a good investment strategy.
Mysteryman
02-24-2009, 08:40 AM
Gus, the DOW jumped over 900 points today. Does this change any of your thoughts you posted late last week?The Dow has lost those 900 points and another 15% or so since your post. Yet I still read stories saying that it's a good time to buy and buy-and-holders are still sticking to their guns even though they have made no money with that strategy in the last decade (they would have had you believe that 10 years was long term). At what point will people open their eyes to the reality?
I'm one of those that's sticking to his guns. If you're trying to make your money purely on buying and sellings stocks as they rise and fall I, for the most part, agree with you. However, the buy-and-hold'ers are receiving divend income while holding onto those stocks too.
The Dow will continue to fall because more and more people are seeing the light. If you want to ride it to the bottom, good luck. Note that the best investors (Warren Buffett, for one notable example) do not buy and hold. They try to buy low and sell high. Buffett is on record as having sold when the Dow was near its highs in 2007. Buy-and-hold ignores the all-important "sell high" part of a good investment strategy.
Continue to fall? To where? Zero? Not likely.
I, sir, am NOT Warren Buffet. :) Buffet seems to be one of the few people that can properly "time" the market. With incredible insight into world affairs, politics, and technology, he also has a fair amount of influence to push things slightly in one direction or another to benefit himself and his investors. That's not me. I have none of that so I have to buy beforethings go up. I have to buy when it may not be the best time because I have no way of knowing when that is.
What would you have me do with my money otherwise? Mattres? Real Estate? Gold? All of these things are just as volitile or risky.
Maxum
02-25-2009, 04:14 PM
Hello all,
Here is some thing I thought you guys might like to play around with.
Calculate Your Financial Comeback
Has your portfolio plummeted? So has ours. Use our Comeback CalculatorSM to calculate when your investments could return to their peak levels.
http://www.nytimes.com/interactive/2009/01/06/business/20090106-comeback-graphic.html?ref=your-money
Ok going back to lurker mode
Here's an interesting interview on NPR with asset manager Paul Krsek:
http://www.npr.org/templates/player/mediaPlayer.html?action=1&t=1&islist=false&id=101248350&m=101248341
Obviously, I find it interesting because he's saying what I've been saying for years: Buy-and-hold is a bad strategy and Wall Street doesn't know anything so you shouldn't listen to them. He got his clients out of stocks last year before the major drop, and he's got them in cash, corporate bonds, and gold now. His clients didn't lose much last year and they're making money this year.
Squeak
03-02-2009, 06:13 PM
What would you have me do with my money otherwise? Mattres? Real Estate? Gold? All of these things are just as volitile or risky.
Cash, plain and simple.
Mysteryman
03-03-2009, 09:21 AM
What would you have me do with my money otherwise? Mattres? Real Estate? Gold? All of these things are just as volitile or risky.
Cash, plain and simple.
The mattress method? So for every $1 you stick in today it'll be worth 60%-80% less when you retire (inflation)?
In fairness, I keep an okay amount of cash on hand should an emergency rear its ugly head, but I pump a much larger chunk into 401k and other securities based retirement savings.
The federal government lets me keep 25% more of my money if I DON'T take it in cash today. That's a good distance ahead of straight cash right there.
Squeak
03-03-2009, 09:47 AM
What would you have me do with my money otherwise? Mattres? Real Estate? Gold? All of these things are just as volitile or risky.
Cash, plain and simple.
The mattress method? So for every $1 you stick in today it'll be worth 60%-80% less when you retire (inflation)?
In fairness, I keep an okay amount of cash on hand should an emergency rear its ugly head, but I pump a much larger chunk into 401k and other securities based retirement savings.
The federal government lets me keep 25% more of my money if I DON'T take it in cash today. That's a good distance ahead of straight cash right there.
Who said anything about the cash not being in your 401k? There is nothing wrong with continuing to contribute to your 401k.
Don't forget that cash is also an asset class, and you should have options to move your money to the 'safe' funds (Treasury backed, low yielding, etc).
They key right now is preservation of capital, not return on it.
The federal government lets me keep 25% more of my money if I DON'T take it in cash today. That's a good distance ahead of straight cash right there.You will be taxed on that money when it comes out, of course. Care to speculate on what tax rates will be when you retire? I assume that we will get our heads out of our asses by then and we'll have to raise rates quite a bit. China probably won't keep buying our debt forever.
Do your 401K statements have a summary of what you've contributed and what it's worth today? My Fidelity 401K statement has this. Mine shows that I've made nothing in 14 years. I'm breaking even. I'm curious to know how you're doing and how long you've been contributing to your 401K. Have you actually made any money?
Where can I buy gold? Actual solid gold, and I don't mean jewelry. Gold coins and stuff. I hear it's rather stable right now.
Where can I buy gold? Actual solid gold, and I don't mean jewelry. Gold coins and stuff. I hear it's rather stable right now.Do you want to hoard gold or do you want to try to profit from increases in the price of gold? If your goal is to profit, look into ETFs (exchange-traded funds) and mutual funds. I see no point in actually owning the gold directly. It's a lot safer and simpler to use ETFs to trade gold.
I was thinking actual physical gold. Something that can't be lost on the market.
You call this stable?
http://www.kitco.com/LFgif/au0182nyb.gif
I guess if you want to know more about buying gold, you can check out this site (http://goldprice.org/buying-gold/) which is where I found that graph (and many others (http://goldprice.org/gold-price-history.html)).
BeanMeScot
03-03-2009, 02:10 PM
You call this stable?
http://www.kitco.com/LFgif/au0182nyb.gif
I guess if you want to know more about buying gold, you can check out this site (http://goldprice.org/buying-gold/) which is where I found that graph (and many others (http://goldprice.org/gold-price-history.html)).
At least the trend is going in the right direction! ;) :)
Looks better than my 401k.
procrastinator
03-03-2009, 02:35 PM
Looks better than my 401k.
Please take this as the compliment it's intended as: you don't look old enough to have a 401k! (Lucky you!) :cool:
Looks better than my 401k.
Please take this as the compliment it's intended as: you don't look old enough to have a 401k! (Lucky you!) :cool:
LOL, thanks. :)
I started it as soon as I was eligible. The sad thing is that it has lost half of it's value. Stupid recession. :tickedoff:
I was thinking actual physical gold. Something that can't be lost on the market.Gold ETFs own actual gold. They buy it and store it. You own a share of actual gold. It's a lot better than trying to buy and store your own gold. You don't have to worry about it being stolen and you don't have to make sure that it's real. Your investment is backed by actual gold. It goes up and down with the price of gold.
Oh, I see. Thanks for the info Gus.
leahn
03-03-2009, 03:24 PM
Jinx,
You probably know this, but, you will be buying at a historical high for Gold. (Pretty much) I owned some gold that I bought at a high-point some 20 odd years ago, for $450 or so an ounce, and it took twenty years for the damned stuff to come back over $450 an ounce. I sold at $600 or so an ounce a year ago and was pleased to be rid of the stuff.
In my opinion, it is a bad time to be buying gold.
-John
d-dub
03-03-2009, 03:33 PM
Looks better than my 401k.
I've been concerned lately (who hasn't?) about the lost value in my 401k over the last year. However, it dawned on my today that I'm also buying twice as many shares (mutual funds) with my monthly contribution than I was a year ago. On top of that, I recently increased my contribution substantially. It seems like when the market recovers, all those extra shares should more than make up for the temporary lost value of the original shares. Or am I thinking crazy?
Combat Medic
03-03-2009, 03:41 PM
Looks better than my 401k.
I've been concerned lately (who hasn't?) about the lost value in my 401k over the last year. However, it dawned on my today that I'm also buying twice as many shares (mutual funds) with my monthly contribution than I was a year ago. On top of that, I recently increased my contribution substantially. It seems like when the market recovers, all those extra shares should more than make up for the temporary lost value of the original shares. Or am I thinking crazy?
I just bought more stock yesterday. As far as I'm concerned the stuff is on sale.
d-dub
03-03-2009, 03:48 PM
Looks better than my 401k.
I've been concerned lately (who hasn't?) about the lost value in my 401k over the last year. However, it dawned on my today that I'm also buying twice as many shares (mutual funds) with my monthly contribution than I was a year ago. On top of that, I recently increased my contribution substantially. It seems like when the market recovers, all those extra shares should more than make up for the temporary lost value of the original shares. Or am I thinking crazy?
I just bought more stock yesterday. As far as I'm concerned the stuff is on sale.
I guess my statement is based on the assumption that the stock market will still exist in 10 years ;)
AJRitz
03-05-2009, 04:20 PM
Shares in CitiGroup are not trading below what CitiBank charges for the use of an out-of-network ATM. :-|
Im dumping as much cash as i can into stock right now. Its like shopping at Dollar General in hopes that the store will one day be Macys level lol. Im trying to put 1000$ a week away.
bryce1012
03-05-2009, 04:47 PM
Shares in CitiGroup are not trading below what CitiBank charges for the use of an out-of-network ATM. :-|That could make for one hell of a promotion.
"For every ATM transaction you make between now and (whenever), get ONE SHARE of CitiGroup stock ABSOLUTELY FREE!!!"
:)
RegBarc
03-05-2009, 05:28 PM
Once I refinance the mortgage, I plan on increasing my contribution to my 453(b), which is sort of like a 401(k). For about a year before the peak, I was putting in 5% per pay. A month before the peak reached, I put it down to 1%. Once it was obvious the market was collapsing, I kept it steady at 1%.
Dow went down another 250 or so today. Refinance should be done in a few weeks and I will bump up my contributions to 12%. I'm 25, mind you, so when I was 22 and got my current job, it was my first exposure to a retirement plan. I figure I'l just start pouring money in when the bottom is reached, which I'm guessing is a month or so.
logic88
03-05-2009, 06:04 PM
Shares in CitiGroup are not trading below what CitiBank charges for the use of an out-of-network ATM. :-|
From a market cap of $270B to $6B in a bit more than 2 years.
I wonder if that's the most wealth destroyed by a company in such a short period of time?
Squeak
03-05-2009, 09:53 PM
Once I refinance the mortgage, I plan on increasing my contribution to my 453(b), which is sort of like a 401(k). For about a year before the peak, I was putting in 5% per pay. A month before the peak reached, I put it down to 1%. Once it was obvious the market was collapsing, I kept it steady at 1%.
Dow went down another 250 or so today. Refinance should be done in a few weeks and I will bump up my contributions to 12%. I'm 25, mind you, so when I was 22 and got my current job, it was my first exposure to a retirement plan. I figure I'l just start pouring money in when the bottom is reached, which I'm guessing is a month or so.
1) We will not be at a bottom in a month or so. Count on it
2) Investing in a retirement account (401k/403b) does not absolutely mean you have to be in the stock market. Almost all plans should have a 'safe' fund that is primarily short-term Treasuries, or a money market account. Contributing is great! Keep doing it! Just set it up for now to go to a safe fund.
JustAllie
03-06-2009, 07:35 AM
Once I refinance the mortgage, I plan on increasing my contribution to my 453(b), which is sort of like a 401(k). For about a year before the peak, I was putting in 5% per pay. A month before the peak reached, I put it down to 1%. Once it was obvious the market was collapsing, I kept it steady at 1%.
Dow went down another 250 or so today. Refinance should be done in a few weeks and I will bump up my contributions to 12%. I'm 25, mind you, so when I was 22 and got my current job, it was my first exposure to a retirement plan. I figure I'l just start pouring money in when the bottom is reached, which I'm guessing is a month or so.
1) We will not be at a bottom in a month or so. Count on it
2) Investing in a retirement account (401k/403b) does not absolutely mean you have to be in the stock market. Almost all plans should have a 'safe' fund that is primarily short-term Treasuries, or a money market account. Contributing is great! Keep doing it! Just set it up for now to go to a safe fund.
He's 25!!! Even if he retires early at 55, his retirement savings has 30 years to recover. I can't see recommending that he leave it all in cash.
Squeak
03-06-2009, 10:14 AM
Once I refinance the mortgage, I plan on increasing my contribution to my 453(b), which is sort of like a 401(k). For about a year before the peak, I was putting in 5% per pay. A month before the peak reached, I put it down to 1%. Once it was obvious the market was collapsing, I kept it steady at 1%.
Dow went down another 250 or so today. Refinance should be done in a few weeks and I will bump up my contributions to 12%. I'm 25, mind you, so when I was 22 and got my current job, it was my first exposure to a retirement plan. I figure I'l just start pouring money in when the bottom is reached, which I'm guessing is a month or so.
1) We will not be at a bottom in a month or so. Count on it
2) Investing in a retirement account (401k/403b) does not absolutely mean you have to be in the stock market. Almost all plans should have a 'safe' fund that is primarily short-term Treasuries, or a money market account. Contributing is great! Keep doing it! Just set it up for now to go to a safe fund.
He's 25!!! Even if he retires early at 55, his retirement savings has 30 years to recover. I can't see recommending that he leave it all in cash.
If you see the train coming, why would you not get off the tracks? Because in 30 years you will mostly likely be fully recovered?
Why not skip the pain for now, and wait for the train to pass? It's not like the train is not blatantly obvious.
Come on, you are smart people! Cash is a completely valid asset class -- there is nothing wrong with want to preserve your capital right now.
Also, no time like the present to start taking an active role in understanding what impacts your personal financial wealth, as opposed to blindly believing buy-and-hold.
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