New Here Wondering About Possible Market Crash

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
User avatar
FGal
Posts: 66
Joined: Thu Apr 05, 2018 4:57 pm

Re: New Here Wondering About Possible Market Crash

Post by FGal »

financeperchance wrote: Fri Jan 24, 2020 5:19 pm
CyclingDuo wrote: Fri Jan 24, 2020 9:26 am
PineForest wrote: Thu Jan 23, 2020 9:57 pm I have a question about the market. I understand that no one can predict where the market is going, but do people here think that the market will crash sometime soon?
Too funny!

You understand that no one can predict where the market is going, yet you ask for everyone's prediction? :mrgreen: :mrgreen: :mrgreen: :mrgreen: :mrgreen:

Stuff this in your back pocket. Hang it on your fridge. Tape it to your monitor. Make it your desktop background or phone screen background. Whatever works for you.

Image
Love this! I'm not quite sure I understand that first point ("markets average one -14% decline").
You left out the important word "annual" which means yearly. So the first point means there is on average at least one 14% drop every year. As it's an average, that may mean one year or two, you may not see it happen. And some years, you'll see a few of them... but they average out to be once a year. ;)
FIREd as of March 2015!
financeperchance
Posts: 256
Joined: Thu Nov 02, 2017 11:15 am

Re: New Here Wondering About Possible Market Crash

Post by financeperchance »

FGal wrote: Sat Jan 25, 2020 12:44 am there is on average at least one 14% drop every year.
Thanks! I'm gonna write out that card in my own handwriting, and I'll use your phrasing for point #1.
User avatar
Orbuculum Nongata
Posts: 484
Joined: Thu Nov 06, 2014 1:58 pm

Re: New Here Wondering About Possible Market Crash

Post by Orbuculum Nongata »

PineForest wrote: Thu Jan 23, 2020 9:57 pm New to investing and to this forum. Appreciate all the valuable information. Even though I'm 44, I'm a beginner with all this. Better late than never...

I have a question about the market. I understand that no one can predict where the market is going, but do people here think that the market will crash sometime soon? Some websites I read say that the stock market has been artificially inflated and that it is not in balance with the values of businesses. Yet it keeps going up.

The practical side of my question is that I have a chunk of money and want to invest it in a couple different VG or Fidelity index funds after holding it in bank accounts for many years. I am wondering if I should wait until the market crashes to invest this money or if I should just go for it, knowing that a crash or correction will happen at some point and and that crashes/corrections are part of the long term game. I don't see myself needing this money for 16 years or more, until I retire.

Thanks.
Welcome.

“Bogleheads” has some great material to help you gain perspective and devise an investment philosophy that suits you. In my opinion, the collection is the most worthwhile part of the site. After that, the members of this forum are a lot like the general population as a whole. We all have the same questions you have about risk and crashes, etc. None of us has the answer to those things. Many of us believe that the amount of time your money is invested is more important than timing the next market crash. For me, I started investing when the Dow Jones Industrial Average was at an all time high. I was nervous about it. It was at 13,000. Today it’s above 29,000. Glad I invested when I did even though it was at the top. You’re 44. The money that could be working for you is collecting dust. My advice if I have any would be to set your allocation according to your risk tolerance, get in and don’t look back. Keep saving and investing.

Not everyone shares this opinion. Others may try to persuade you the sky is going to fall, and they know when. That’s gambling on when to put money in the market, when to take it out and when to get back in again. This isn’t roulette. Put your gut feelings and emotions aside. You’ll be glad you did when the Dow Jones Industrial Average surpasses 50,000.

Best to you.
Potential - distraction = performance.
wrongfunds
Posts: 2313
Joined: Tue Dec 21, 2010 3:55 pm

Re: New Here Wondering About Possible Market Crash

Post by wrongfunds »

financeperchance wrote: Sat Jan 25, 2020 7:41 am
FGal wrote: Sat Jan 25, 2020 12:44 am there is on average at least one 14% drop every year.
Thanks! I'm gonna write out that card in my own handwriting, and I'll use your phrasing for point #1.
Measured as how? From January 1st to the day? So are you saying every year there will be a day which will have the market value of 86 if the market was 100 on January 1st?

Or it is saying that there will be two dates in year D1 and D2 where D2 is after D1
and
Mkt(D1) -- Mkt(D2) = 0.14( Mkt(D1) )

I don't believe either scenario is true for all years.
User avatar
Taylor Larimore
Advisory Board
Posts: 30025
Joined: Tue Feb 27, 2007 8:09 pm
Location: Miami FL

Re: New Here Wondering About Possible Market Crash

Post by Taylor Larimore »

Pine Forrest:

Welcome to the Bogleheads Forum!

It is always scary to make our first investment in stocks. Yes, stocks could go down the next day. You can be certain that they will go down many times during a lifetime of investing. Stocks go up and down--you must recognize that fact and become comfortable with it. I have been through fifteen bear markets when the S&P plunged more than 20%. It is no fun to see your life savings evaporite day by day, sometimes for years.

On the other hand, when I started investing in 1950 at the age of 26, the S&P stocks were priced at about 20. Today the S&P 500 Index (not counting dividends) is about 3,300.

Lesson learned: Buy the S&P 500 Index (or Total U.S. Stock Market Index) then Stay the Course.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "In my view, owning the market and holding it forever is the ultimate strategy for winners."
Last edited by Taylor Larimore on Sat Jan 25, 2020 11:50 am, edited 1 time in total.
"Simplicity is the master key to financial success." -- Jack Bogle
financeperchance
Posts: 256
Joined: Thu Nov 02, 2017 11:15 am

Re: New Here Wondering About Possible Market Crash

Post by financeperchance »

wrongfunds wrote: Sat Jan 25, 2020 10:13 am
financeperchance wrote: Sat Jan 25, 2020 7:41 am
FGal wrote: Sat Jan 25, 2020 12:44 am there is on average at least one 14% drop every year.
Thanks! I'm gonna write out that card in my own handwriting, and I'll use your phrasing for point #1.
Measured as how? From January 1st to the day? So are you saying every year there will be a day which will have the market value of 86 if the market was 100 on January 1st?

Or it is saying that there will be two dates in year D1 and D2 where D2 is after D1
and
Mkt(D1) -- Mkt(D2) = 0.14( Mkt(D1) )

I don't believe either scenario is true for all years.
Okay, I just did a bit of research. I think whoever wrote out the card may have been thinking of this:
https://www.cnbc.com/2018/10/26/the-sto ... erage.html

If it was based on data from before 2015, it would probably have rounded to 14% (today 13%). So what point #1 should say, based on that data, is:

"The average market correction is 13% and happens once every 2 years"
wrongfunds
Posts: 2313
Joined: Tue Dec 21, 2010 3:55 pm

Re: New Here Wondering About Possible Market Crash

Post by wrongfunds »

Still not sure how that was computed either. Was it done at the beginning of every month? Was it done by looking at every day for 2 consecutive years? Was it done by looking at rolling (2x365) days?

When CNBC and or MSNBC throw numbers which don't pass my smell test, I need to know how they come up with the numbers.
User avatar
CyclingDuo
Posts: 3730
Joined: Fri Jan 06, 2017 9:07 am

Re: New Here Wondering About Possible Market Crash

Post by CyclingDuo »

financeperchance wrote: Sat Jan 25, 2020 7:41 am
FGal wrote: Sat Jan 25, 2020 12:44 am there is on average at least one 14% drop every year.
Thanks! I'm gonna write out that card in my own handwriting, and I'll use your phrasing for point #1.
Didn't think the word annual was going to be that difficult to figure out... :shock:

The card came from Ritholtz Wealth Management and Finacial Advisor Anthony Isola....

https://www.marketwatch.com/story/panic ... 2018-02-08

Over the long term, however, such declines are erased by the general uptrend of equity markets. “Over long periods, markets significantly beat inflation,” the card reads, noting that historically, markets tend to rise in almost 75% of years.

In terms of a shorter term duration, the 11 corrections in the S&P 500 since the bottom in 2009 have an average decline of -13.07% (ranging from -5.8% to -19.8%).

You can follow along at Yardeni Research for bull & bear markets here (gets updated every evening after the market's close) to see the corrections for the S&P 500 (data is also available for other indices as well at https://www.yardeni.com/). Here is the S&P 500 Index:

https://www.yardeni.com/pub/sp500corrbear.pdf

For the OP, another way to think about it is based on your annual savings into investments each and every year - and what each year's investment would be worth 5 years later. This is an interesting graphic I saw at FourPillarFreedom.com based on $1K invested each year into an S&P 500 Index Fund and the subsequent value 5 years later of that S&P 500 Index fund investment....

Image

I'm sure there are all types of things to consider regarding what did or did not go into that graphic, but it at least visually illustrates the short term of 1 year to the intermediate term of 5 years later is guaranteed to be a mixed bag if one is investing automatically from their paycheck on a routine basis throughout their accumulation years. In other words - we will invest money at highs, lows, and a lot of between along the way.

I am sure many other Bogleheads who are still in the accumulation phase and invest on a routine basis (weekly/bi-weekly/monthly) would join me in saying "I have invested at or near all other highs during the past three decades or more." Or whatever time frame since they began their routine investing. That's the nature of automatic, routine money going into investments from paychecks, salary, additional income, etc... .

Ben Carson did this blog post What if You Only Invested at Market Peaks?

https://awealthofcommonsense.com/2014/0 ... ket-timer/

CyclingDuo
"Save like a pessimist, invest like an optimist." - Morgan Housel
Topic Author
PineForest
Posts: 11
Joined: Thu Jan 23, 2020 5:12 pm

Re: New Here Wondering About Possible Market and Social-Economic-Ecological Decline

Post by PineForest »

All this is providing great food for thought and helping me rethink my investment philosophy. Thanks again for all the responses.

There is one more thing I want to ask about as I (deeply) reevaluate my ideas about money and investing. I know I am risking intense responses from some, but it's important for me to be honest about why I have kept most of my money in the bank for the last 10 years ( :oops: ). It's mostly because have thought, right or wrong, that our society/world has been in a serious process of ecological, social, and economic decline. I have wondered if life as we know it in the industrial world would change radically (and not for the better) in the next years and decades. I had previously been thinking that keeping money in the bank would be safer due to the converging crises of our time.

I suspect lots of people here would disagree with my wonderings about the future (and I do hope they are right!) but these fears are what's held me back from investing more actively and productively. I am not interested in arguing with anyone about the future state of the planet, society, or humanity or having my musings about all this stuff put down, but I am wondering two things

a) if anyone else has a world view that considers possible huge changes in our society/civilization as know it and if it affects their investment strategy at all

b) After studying some postings on this forum, I've learned that in the long run as much as one can track it, the stock prices do go up and that money in the bank loses value due to inflation.

It seems to me that if there were major cataclysms or collapse-type events or trends, my money in the bank wouldn't necessarily be very helpful either, so I'm thinking, why not despite the risks invest diligently in the 3-fund portfolio with the odds that our social and economic structure as know it will continue at least in some form?

I'd appreciate any perspectives on the above. I get that many doomsayers have predicted the end of the world over the last few millennia and want to make it clear that that's not what I'm talking about here. I'm talking about my fears of serious and protracted crises at a local and global level and disruptions to the complex systems we take for granted but are (it sometimes seems to me) more precarious than many believe, and considering all that, how I might adopt a better investment strategy moving forward.

Thanks!
kajb1313
Posts: 9
Joined: Thu Oct 11, 2018 9:31 am

Re: New Here Wondering About Possible Market Crash

Post by kajb1313 »

Taylor Larimore wrote: Sat Jan 25, 2020 10:47 am Pine Forrest:

Welcome to the Bogleheads Forum!

It is always scary to make our first investment in stocks. Yes, stocks could go down the next day. You can be certain that they will go down many times during a lifetime of investing. Stocks go up and down--you must recognize that fact and become comfortable with it. I have been through fifteen bear markets when the S&P plunged more than 20%. It is no fun to see your life savings evaporite day by day, sometimes for years.

On the other hand, when I started investing in 1950 at the age of 26, the S&P stocks were priced at about 20. Today the S&P 500 Index (not counting dividends) is about 3,300.

Lesson learned: Buy the S&P 500 Index (or Total U.S. Stock Market Index) then Stay the Course.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "In my view, owning the market and holding it forever is the ultimate strategy for winners."
Taylor, well said, simply put! 👍
User avatar
cashboy
Posts: 582
Joined: Tue Sep 11, 2018 5:03 pm
Location: USA

Re: New Here Wondering About Possible Market Crash

Post by cashboy »

PineForest wrote: Thu Jan 23, 2020 9:57 pm I have a question about the market. I understand that no one can predict where the market is going, but do people here think that the market will crash sometime soon?
yes

no

maybe

:happy

in all seriousness, set your AA to a point that makes you comfortable and prepared for a market crash. I'm at 50/50.
Three-Fund Portfolio: FSPSX - FXAIX - FXNAX (with slight tilt of CDs - CASH - Canned Beans - Rice - Bottled Water)
jpelder
Posts: 816
Joined: Mon Jan 26, 2015 3:56 pm
Location: Concord, NC

Re: New Here Wondering About Possible Market and Social-Economic-Ecological Decline

Post by jpelder »

PineForest wrote: Sat Jan 25, 2020 12:16 pm All this is providing great food for thought and helping me rethink my investment philosophy. Thanks again for all the responses.

There is one more thing I want to ask about as I (deeply) reevaluate my ideas about money and investing. I know I am risking intense responses from some, but it's important for me to be honest about why I have kept most of my money in the bank for the last 10 years ( :oops: ). It's mostly because have thought, right or wrong, that our society/world has been in a serious process of ecological, social, and economic decline. I have wondered if life as we know it in the industrial world would change radically (and not for the better) in the next years and decades. I had previously been thinking that keeping money in the bank would be safer due to the converging crises of our time.

I suspect lots of people here would disagree with my wonderings about the future (and I do hope they are right!) but these fears are what's held me back from investing more actively and productively. I am not interested in arguing with anyone about the future state of the planet, society, or humanity or having my musings about all this stuff put down, but I am wondering two things

a) if anyone else has a world view that considers possible huge changes in our society/civilization as know it and if it affects their investment strategy at all

b) After studying some postings on this forum, I've learned that in the long run as much as one can track it, the stock prices do go up and that money in the bank loses value due to inflation.

It seems to me that if there were major cataclysms or collapse-type events or trends, my money in the bank wouldn't necessarily be very helpful either, so I'm thinking, why not despite the risks invest diligently in the 3-fund portfolio with the odds that our social and economic structure as know it will continue at least in some form?

I'd appreciate any perspectives on the above. I get that many doomsayers have predicted the end of the world over the last few millennia and want to make it clear that that's not what I'm talking about here. I'm talking about my fears of serious and protracted crises at a local and global level and disruptions to the complex systems we take for granted but are (it sometimes seems to me) more precarious than many believe, and considering all that, how I might adopt a better investment strategy moving forward.

Thanks!
I understand those concerns, and your second-to-last paragraph kind of covers it. Barring world-ending catastrophe, people will continue to form companies and buy and sell products and services. The benefit of investing in total market index funds is that you are guaranteed to own a piece of the next big thing. Will Tesla revolutionize the car industry? Will some company we haven't heard of develop fusion reactors that actually generate energy? Who cares? I own some of everything. I'll share in the gains and the losses.
Or, to put it differently by modifying Sir Winston Churchill: "Investing in stocks is the worst way to grow your money, besides all the other ways we've tried."
User avatar
cashboy
Posts: 582
Joined: Tue Sep 11, 2018 5:03 pm
Location: USA

Re: New Here Wondering About Possible Market and Social-Economic-Ecological Decline

Post by cashboy »

PineForest wrote: Sat Jan 25, 2020 12:16 pm All this is providing great food for thought and helping me rethink my investment philosophy. Thanks again for all the responses.

There is one more thing I want to ask about as I (deeply) reevaluate my ideas about money and investing. I know I am risking intense responses from some, but it's important for me to be honest about why I have kept most of my money in the bank for the last 10 years ( :oops: ). It's mostly because have thought, right or wrong, that our society/world has been in a serious process of ecological, social, and economic decline. I have wondered if life as we know it in the industrial world would change radically (and not for the better) in the next years and decades. I had previously been thinking that keeping money in the bank would be safer due to the converging crises of our time.

I suspect lots of people here would disagree with my wonderings about the future (and I do hope they are right!) but these fears are what's held me back from investing more actively and productively. I am not interested in arguing with anyone about the future state of the planet, society, or humanity or having my musings about all this stuff put down, but I am wondering two things

a) if anyone else has a world view that considers possible huge changes in our society/civilization as know it and if it affects their investment strategy at all

b) After studying some postings on this forum, I've learned that in the long run as much as one can track it, the stock prices do go up and that money in the bank loses value due to inflation.

It seems to me that if there were major cataclysms or collapse-type events or trends, my money in the bank wouldn't necessarily be very helpful either, so I'm thinking, why not despite the risks invest diligently in the 3-fund portfolio with the odds that our social and economic structure as know it will continue at least in some form?

I'd appreciate any perspectives on the above. I get that many doomsayers have predicted the end of the world over the last few millennia and want to make it clear that that's not what I'm talking about here. I'm talking about my fears of serious and protracted crises at a local and global level and disruptions to the complex systems we take for granted but are (it sometimes seems to me) more precarious than many believe, and considering all that, how I might adopt a better investment strategy moving forward.

Thanks!
in general, if you look at world history, the world today is 'much the same' as it has ever been (except perhaps for technology and medical advancements); wars, corruption, politics, disease, uncertainty, instability, etc. it just seems different, or more intense, right now because you are living through it and experiencing it.

in general, people invest because they 'have to' (myself included), not because they 'want to' - and they do it during times like these. consider the consequences of not investing.

i think it was mr bogle who said "invest we must". incredible wisdom in those words.
Three-Fund Portfolio: FSPSX - FXAIX - FXNAX (with slight tilt of CDs - CASH - Canned Beans - Rice - Bottled Water)
User avatar
abuss368
Posts: 22109
Joined: Mon Aug 03, 2009 2:33 pm
Location: Where the water is warm, the drinks are cold, and I don't know the names of the players!
Contact:

Re: New Here Wondering About Possible Market Crash

Post by abuss368 »

Taylor Larimore wrote: Sat Jan 25, 2020 10:47 am Pine Forrest:

Welcome to the Bogleheads Forum!

It is always scary to make our first investment in stocks. Yes, stocks could go down the next day. You can be certain that they will go down many times during a lifetime of investing. Stocks go up and down--you must recognize that fact and become comfortable with it. I have been through fifteen bear markets when the S&P plunged more than 20%. It is no fun to see your life savings evaporite day by day, sometimes for years.

On the other hand, when I started investing in 1950 at the age of 26, the S&P stocks were priced at about 20. Today the S&P 500 Index (not counting dividends) is about 3,300.

Lesson learned: Buy the S&P 500 Index (or Total U.S. Stock Market Index) then Stay the Course.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "In my view, owning the market and holding it forever is the ultimate strategy for winners."
This was the message I was thinking about recently in relation to our Jack Bogle and Warren Buffett Two Fund Portfolio. I had recalled Taylor mentioning the S&P 500 when he started investing but did not remember the index number. Wow! 26 and now 3,300.

Taylor is correct! Own the market and stay the course!
John C. Bogle: “Simplicity is the master key to financial success."
User avatar
unclescrooge
Posts: 5410
Joined: Thu Jun 07, 2012 7:00 pm

Re: New Here Wondering About Possible Market and Social-Economic-Ecological Decline

Post by unclescrooge »

PineForest wrote: Sat Jan 25, 2020 12:16 pm All this is providing great food for thought and helping me rethink my investment philosophy. Thanks again for all the responses.

There is one more thing I want to ask about as I (deeply) reevaluate my ideas about money and investing. I know I am risking intense responses from some, but it's important for me to be honest about why I have kept most of my money in the bank for the last 10 years ( :oops: ). It's mostly because have thought, right or wrong, that our society/world has been in a serious process of ecological, social, and economic decline. I have wondered if life as we know it in the industrial world would change radically (and not for the better) in the next years and decades. I had previously been thinking that keeping money in the bank would be safer due to the converging crises of our time.

Thanks!
You need to read this article: https://www.spectator.co.uk/2019/12/wev ... seriously/

Betting against humanity ingenuity has been a losing proposition for tens of thousands of years. Are you going to trust your strong instincts, or actual data?

I own 30oz of gold coins, just in case society collapses. But I'm 99% sure society will not collapse in my lifetime.

You can hedge you bets without taking an all or nothing approach.
lexor
Posts: 810
Joined: Thu Feb 27, 2014 10:32 am

Re: New Here Wondering About Possible Market and Social-Economic-Ecological Decline

Post by lexor »

unclescrooge wrote: Sat Jan 25, 2020 4:51 pm
PineForest wrote: Sat Jan 25, 2020 12:16 pm All this is providing great food for thought and helping me rethink my investment philosophy. Thanks again for all the responses.

There is one more thing I want to ask about as I (deeply) reevaluate my ideas about money and investing. I know I am risking intense responses from some, but it's important for me to be honest about why I have kept most of my money in the bank for the last 10 years ( :oops: ). It's mostly because have thought, right or wrong, that our society/world has been in a serious process of ecological, social, and economic decline. I have wondered if life as we know it in the industrial world would change radically (and not for the better) in the next years and decades. I had previously been thinking that keeping money in the bank would be safer due to the converging crises of our time.

Thanks!
You need to read this article: https://www.spectator.co.uk/2019/12/wev ... seriously/

Betting against humanity ingenuity has been a losing proposition for tens of thousands of years. Are you going to trust your strong instincts, or actual data?

I own 30oz of gold coins, just in case society collapses. But I'm 99% sure society will not collapse in my lifetime.

You can hedge you bets without taking an all or nothing approach.
Is gold actually valuable if society collapses? I'd think guns, water, food would be valuable. Maybe if the dollar collapses but society does not then gold or bitcoin would be valuable.
“The miracle of compounding returns is overwhelmed by the tyranny of compounding costs.” -Mr. John C. Bogle
User avatar
unclescrooge
Posts: 5410
Joined: Thu Jun 07, 2012 7:00 pm

Re: New Here Wondering About Possible Market and Social-Economic-Ecological Decline

Post by unclescrooge »

lexor wrote: Sat Jan 25, 2020 5:09 pm
unclescrooge wrote: Sat Jan 25, 2020 4:51 pm
PineForest wrote: Sat Jan 25, 2020 12:16 pm All this is providing great food for thought and helping me rethink my investment philosophy. Thanks again for all the responses.

There is one more thing I want to ask about as I (deeply) reevaluate my ideas about money and investing. I know I am risking intense responses from some, but it's important for me to be honest about why I have kept most of my money in the bank for the last 10 years ( :oops: ). It's mostly because have thought, right or wrong, that our society/world has been in a serious process of ecological, social, and economic decline. I have wondered if life as we know it in the industrial world would change radically (and not for the better) in the next years and decades. I had previously been thinking that keeping money in the bank would be safer due to the converging crises of our time.

Thanks!
You need to read this article: https://www.spectator.co.uk/2019/12/wev ... seriously/

Betting against humanity ingenuity has been a losing proposition for tens of thousands of years. Are you going to trust your strong instincts, or actual data?

I own 30oz of gold coins, just in case society collapses. But I'm 99% sure society will not collapse in my lifetime.

You can hedge you bets without taking an all or nothing approach.
Is gold actually valuable if society collapses? I'd think guns, water, food would be valuable. Maybe if the dollar collapses but society does not then gold or bitcoin would be valuable.
Gold has been used as a form of currency for over 5,000 years. I'm happy to put my faith in it.
heyyou
Posts: 3816
Joined: Tue Feb 20, 2007 4:58 pm

Re: New Here Wondering About Possible Market Crash

Post by heyyou »

At the OP: I started buying the stock index fund in 1980 (there was only one--the S&P 500), so far, so good, but it has not been a smooth ride. We get paid (higher returns) to tolerate the risks of owning stock index shares with their constantly variable prices, and sometimes the drops are sudden/steep and deep. That is just how it goes, there is not a secret way to avoid that problem. Just hang on for the long term instead of trying to dodge the bad times that periodically occur.
User avatar
RootSki
Posts: 515
Joined: Mon Feb 20, 2017 11:52 am

Re: New Here Wondering About Possible Market and Social-Economic-Ecological Decline

Post by RootSki »

lexor wrote: Sat Jan 25, 2020 5:09 pm
unclescrooge wrote: Sat Jan 25, 2020 4:51 pm
PineForest wrote: Sat Jan 25, 2020 12:16 pm All this is providing great food for thought and helping me rethink my investment philosophy. Thanks again for all the responses.

There is one more thing I want to ask about as I (deeply) reevaluate my ideas about money and investing. I know I am risking intense responses from some, but it's important for me to be honest about why I have kept most of my money in the bank for the last 10 years ( :oops: ). It's mostly because have thought, right or wrong, that our society/world has been in a serious process of ecological, social, and economic decline. I have wondered if life as we know it in the industrial world would change radically (and not for the better) in the next years and decades. I had previously been thinking that keeping money in the bank would be safer due to the converging crises of our time.

Thanks!
You need to read this article: https://www.spectator.co.uk/2019/12/wev ... seriously/

Betting against humanity ingenuity has been a losing proposition for tens of thousands of years. Are you going to trust your strong instincts, or actual data?

I own 30oz of gold coins, just in case society collapses. But I'm 99% sure society will not collapse in my lifetime.

You can hedge you bets without taking an all or nothing approach.
Is gold actually valuable if society collapses? I'd think guns, water, food would be valuable. Maybe if the dollar collapses but society does not then gold or bitcoin would be valuable.
Yes, all of that. Guns to protect the gold and the food.

You’ll also need life skills that are useful.
Gemini1962
Posts: 68
Joined: Sun Jan 26, 2020 5:22 am

Re: New Here Wondering About Possible Market Crash

Post by Gemini1962 »

When J P Morgan was asked to give a stock market prediction his reply was "It will fluctuate"
Topic Author
PineForest
Posts: 11
Joined: Thu Jan 23, 2020 5:12 pm

Re: New Here Wondering About Possible Market Crash

Post by PineForest »

Taylor Larimore wrote: Sat Jan 25, 2020 10:47 am Pine Forrest:

Welcome to the Bogleheads Forum!

It is always scary to make our first investment in stocks. Yes, stocks could go down the next day. You can be certain that they will go down many times during a lifetime of investing. Stocks go up and down--you must recognize that fact and become comfortable with it. I have been through fifteen bear markets when the S&P plunged more than 20%. It is no fun to see your life savings evaporite day by day, sometimes for years.

On the other hand, when I started investing in 1950 at the age of 26, the S&P stocks were priced at about 20. Today the S&P 500 Index (not counting dividends) is about 3,300.

Lesson learned: Buy the S&P 500 Index (or Total U.S. Stock Market Index) then Stay the Course.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "In my view, owning the market and holding it forever is the ultimate strategy for winners."
Taylor,

Thank you for your sagacious words of encouragement! And thank you much for getting this forum going and for your excellent books that I'm excited to start studying.

Take care,

Pine Forest (Pierre)
Post Reply