Blood on the streets cleaned up

[Matawan3]

Holy Shit guys, 0 percent interest, another 2T stimulus passed, vaccines going into arms. People getting back to work. there is absolutely no reason to be afraid for the next few months to a year.

Will this party eventually have a hangover, absolutely. Eventually, they are going to start talking about raising taxes but it will not be anything serious because this momentum will be worth gold for the mid term elections. Once the elections are over, there will be some serious talk about taxes.

The future is bright gentlemen, automation, increased population, more customers, less workers!!! enjoy the ride and adjust your investments to your risk tolerance level.

The only thing I could see ending the party is an over heated economy, inflation, and the chance of raising rates or if one of those covid variants was vaccine resistant, we'd fall hard and fast.

But other than that, everyone is flocking to market in droves. It really is the only game in town to earn quickly.

Its scary to think there are a lot of people in the market right now, who think it only goes up. They haven't felt the pain of the bear. When that day comes and we have panic selling, or people realizing buying the dip is catching a falling knife.......... look out below.

 

[charliebrown]

How do we get an overheated economy with 60% participation rate? Economy heats up, either interest rates and/or taxes will slow it down.

Pandemic, variants, yep, said it many times, this virus, worst case can wipe out the senior citizens in this country. assets transfer, SSi and medicare roles drop like a rock. Will the economy really collapse? I said this the first time everyone panics and I will say it this time. it would be a human tragedy, not an economic catastrophe

 

[Doubleyellow]

 

[Doubleyellow]

Well...modern medicine is doing great things...
Yeah, that works.

If you can find eternal moments within every day, time stops mattering, it doesn't exist. I think you have that one in the bag!

 

[Matawan3]

How do we get an overheated economy with 60% participation rate? Economy heats up, either interest rates and/or taxes will slow it down.

Pandemic, variants, yep, said it many times, this virus, worst case can wipe out the senior citizens in this country. assets transfer, SSi and medicare roles drop like a rock. Will the economy really collapse? I said this the first time everyone panics and I will say it this time. it would be a human tragedy, not an economic catastrophe

The economy could roar back post pandemic. Interest rates would keep it in check, but when money is harder to borrow, stocks go down and some flee stocks to go to the safety of bonds. That is what caused our mini drop in 2015. Also we are starting to see rotations out of tech stocks now in preparation for it.

Pandemic variants would cause more lockdowns and that would tank our stock market. Right now the market has basically priced in a covid free summer. Any change to that and stocks will drop.

At least thats what I see. But this stuff can change on a dime. Thats always the thing that scares me.

 

[248Lancer]

The bigger picture for me beyond age/risk proportion:

Once the pension-plan retirement generation exits, a much greater share of the population will be those who only ever had 401k's and/or IRAs as a retirement planning option. These people will be forced to continue to pump money into the markets, regardless of the market's direction in the short term. Deviations in the overall market will start having more frequent, and more amplified impacts on Joe Q. Public and his retirement nest egg.

I still have a 15+ yr time horizon, and expect intense volatility for the next decade.

 

[Matawan3]

I also want to add that I think financial planners are a complete and total waste of money. I had one of those. He bought and held, and told me "stay the course" when I was worried. Then he collected a huge fee.

I got smart when I realized I could do that myself for free.

 

[Matawan3]

The bigger picture for me beyond age/risk proportion:

Once the pension-plan retirement generation exits, a much greater share of the population will be those who only ever had 401k's and/or IRAs as a retirement planning option. These people will be forced to continue to pump money into the markets, regardless of the market's direction in the short term. Deviations in the overall market will start having more frequent, and more amplified impacts on Joe Q. Public and his retirement nest egg.

I still have a 15+ yr time horizon, and expect intense volatility for the next decade.

Yeah, I am kind of suprised that we haven't had more volatility. With machines running things, I am waiting for the day when we flash crash. Its pretty shocking it hasn't happened sooner. People get upset over a -700 on the DJIA when in relation to its value, thats nothing. A bad day relative to value is -5000. Surprised we haven't had it happen yet.

 

[Doubleyellow]

The bigger picture for me beyond age/risk proportion:

Once the pension-plan retirement generation exits, a much greater share of the population will be those who only ever had 401k's and/or IRAs as a retirement planning option. These people will be forced to continue to pump money into the markets, regardless of the market's direction in the short term. Deviations in the overall market will start having more frequent, and more amplified impacts on Joe Q. Public and his retirement nest egg.

I still have a 15+ yr time horizon, and expect intense volatility for the next decade.

If you have a long horizon, it is wise to pump money in, whatever the direction, for dollar cost averaging....but beyond that is where you can score. In big drops, rebalance to whatever your magic ratio is. The past year is a perfect example. If you were a 70:30 person, last march due to equities sell offs, you were probably down to a 50:50. If you had the balls to sell bonds or use some cash to rebalance your equities back up to 70 of your portfolio, you return faster to where you were, and today you would be way ahead of just sitting still. Someone in my family cashed out in march 2020, he got spooked after seeing his portfolio drop 25%, guarenteed himself a loss, and lost because he missed the return.

Another factor that helps. --- have a shit load of money, that takes the edge off when the market shits itself.

 

[Matawan3]

One thing you cannot deny. If you bought PRIOR to any crash we've had, you'd be way ahead today. So worst case, if you buy today, and the market crashes tomorrow, chances are, you will eventually be way ahead.

Also- someone once told me, if the market totally wipes out, and you lose everything. Chances are people will have way bigger issues to worry about than money lost in the market. (The US dollar being worth nothing anyway).

So its always worth it. But never play with scared money. Never get into a situation where you think you might panic sell. No one ever made a dime by panicking. Be prepared to lose 30%-40% or more of what you put in.

 

[njlefty]

I also want to add that I think financial planners are a complete and total waste of money. I had one of those. He bought and held, and told me "stay the course" when I was worried. Then he collected a huge fee.

I got smart when I realized I could do that myself for free.

I agree with this. I think financial planners are worthless. I educated myself and trusted my instincts.

 

[njlefty]

I also remember an advisor telling me I cannot miss investing in Irish banks such as Allied Irish Banks and the Bank of Ireland, pre 2008. Eh, what the hell, why not?

I bought a boatload of Allied Irish Banks at $56 a share. At one point it dropped to 90 cents a share and it currently trades at $2.68.

As my buddy once said to me, that’s a sad story.

 

[Doubleyellow]

I agree with this. I think financial planners are worthless. I educated myself and trusted my instincts.

Most of what I do around investments I can do on my own, but I find value in working with the right planner for my situation. Over one period of my investment life I paid a planner by the hour for guidance. None of this fixed percentage fee for him, just his rate. We met twice a year. He would look at my overall picture and make recommendations on what to earn and how. This guy had some unique knowledge of tax and investment laws that he had me apply, and he helped me structure the type of income / investment situations necessary to apply his knowledge. He also did my taxes.

 

[njlefty]

Well, the March hiring numbers apparently will be real good, the Dow is over 33,000, and the market is set to go even higher.

I’ve been tipping everybody at about 40 percent these days. Why not, money won’t do me good in the afterlife.

My biggest fear about the afterlife is meeting up with the nuns I remember rather than the providers I knew.

 

[Plat122]

When you meet the Nuns maybe you will get to hit them across the knuckles with the ruler this time.

 

[East Lake II]

Yeah, I am kind of suprised that we haven't had more volatility. With machines running things, I am waiting for the day when we flash crash. Its pretty shocking it hasn't happened sooner. People get upset over a -700 on the DJIA when in relation to its value, thats nothing. A bad day relative to value is -5000. Surprised we haven't had it happen yet.

Don’t know if there will ever be a drop that big. Circuit breakers keep it from free falling and stop it after it goes goes down a set %. Even with repeated days of maximum sell off, it gives the Fed time to come in and save the day.

 

[East Lake II]

This guy had some unique knowledge of tax and investment laws that he had me apply, and he helped me structure the type of income / investment situations necessary to apply his knowledge. He also did my taxes.

Sounds like you found a good one.

 

[Matawan3]

Don’t know if there will ever be a drop that big. Circuit breakers keep it from free falling and stop it after it goes goes down a set %. Even with repeated days of maximum sell off, it gives the Fed time to come in and save the day.

I think those circuit breakers are silly. We saw with the pandemic that they didn't do anything. DJIA takes a dive, trading stop, trading restarts, DJIA takes another dive, and on and on.

The FED is running out of levers to pull. Interest rates have been ridiculously low since 2009.

I am not a doom and gloom type who thinks another 1929 is just around the corner..... but I am also very cautious that our market has gone too high too quick and clearly doesn't reflect what is currently happening. When cheap money is no longer cheap, its going to be a bad day. Whether that comes tomorrow, or comes 10 years from now is anyone's guess.

 

[East Lake II]

I think those circuit breakers are silly. We saw with the pandemic that they didn't do anything. DJIA takes a dive, trading stop, trading restarts, DJIA takes another dive, and on and on.”

They paused the free fall and gave the Fed time to react. It took the Fed a while to act, but all things considered they learned from the CMO meltdown in ‘08.

“The FED is running out of levers to pull. Interest rates have been ridiculously low since 2009.”

True, makes you wonder what they will cook up next.”

“I am not a doom and gloom type who thinks another 1929 is just around the corner..... but I am also very cautious that our market has gone too high too quick and clearly doesn't reflect what is currently happening. When cheap money is no longer cheap, its going to be a bad day. Whether that comes tomorrow, or comes 10 years from now is anyone's guess.

”

Yep, too much easy free money flowing into the market. But, it’s too big to fail. The government realizes that generations have their retirement and life savings tied up in the market. They will do anything and everything to keep the illusion alive.

 

[njlefty]

”

Yep, too much easy free money flowing into the market. But, it’s too big to fail. The government realizes that generations have their retirement and life savings tied up in the market. They will do anything and everything to keep the illusion alive.

Very much true. I look at the homes of retirees where I live. These are huge places, four or five bedrooms, and many go unused. No one lives more than a few months in them and some of them are third homes, not second homes. Then I drive a few miles west and I see these shacks that don't look like they have much indoor plumbing, and these are year round homes for whomever. The disconnect reminds me of the disconnect of the markets. Something is not adding up.