It's Not Different This Time

[White Coat Investor]

A lot of newer forum participants have been surprised to see so many supposed Bogleheads panicking, selling low, market timing, picking individual stocks etc. They are surprised because they thought Bogleheads didn't do this stuff. Indeed, their mentor, Jack Bogle, said

I've said "Stay the course" a thousand times, and I meant it every time.

He meant it this time too, even if he isn't around to say it. Some of them are wondering if this mass Boglehead panic happened in 2008 too. While I'm nowhere near the oldest or most experienced Boglehead, I just wanted to reassure these newer members that yes, this happened in 2008 as well. There were lots of people who professed to be Bogleheads but didn't stay the course in 2008. Here are some examples. Feel free to add your own to the list.

viewtopic.php?t=33253

viewtopic.php?t=32624

viewtopic.php?t=32623

viewtopic.php?t=5934

viewtopic.php?t=25126

viewtopic.php?t=33849

Stay the course. We don't know how deep this bear will go. We don't know when it will end. But we do know two things:

# 1 It will end.
# 2 Those who continue to follow their reasonable written plan will be glad they did so on the other side of it while those who panicked and sold low will regret their actions.

Good luck investing. Stay healthy.

Edit: Maybe I'll start compiling threads here from this bear market too. Here's one:

viewtopic.php?p=5123733#p5123733

I don't want to say "I told you so" but this post pretty much called the bottom. I have no idea where the market goes from here (just as I didn't on March 22nd) but it is up 41% from March 22nd.

Stay the course.

[montanagirl]

I bought the big dips and now I'm back to where I was in January.

[Grt2bOutdoors]

I bought the big dips and now I'm back to where I was in January.

Stay tuned.....second quarter earnings or lack thereof is coming up....,getting out popcorn.

[csantiago]

With a few more months on our side, just curious if anyone has any "feel good" narratives from the past showing that this time really is not different.

Because it sure seems different. The Fed's QE is rising at a quick rate, there's US-China tensions, and someone who wants to return to the gold standard may be joining The Fed soon. Millions unemployed and rising. Uncertainty around commercial and residential real estate.

I'm not trying to be doom and gloom but...it's a lot of a lot. There is no alternative than equities right now, but is that a permanent belief? For this of us in wealth accumulation phase, is "stay the course" an infallible strategy, or should we be hedging out of VTSAX?

[flaccidsteele]

99 times out of 100 those who nailed a financial move from "seeing something that the market had not priced" were simply lucky.

+1

Completely agree

Anybody who says that they predicted something, didn’t

“Nobody knows nothing.” - John Bogle

[Robot Monster]

With a few more months on our side, just curious if anyone has any "feel good" narratives from the past showing that this time really is not different.

Because it sure seems different. The Fed's QE is rising at a quick rate, there's US-China tensions, and someone who wants to return to the gold standard may be joining The Fed soon. Millions unemployed and rising. Uncertainty around commercial and residential real estate.

I'm not trying to be doom and gloom but...it's a lot of a lot. There is no alternative than equities right now, but is that a permanent belief? For this of us in wealth accumulation phase, is "stay the course" an infallible strategy, or should we be hedging out of VTSAX?

Don't invest according to a prediction of "this time it's different" . Our prediction machine is broken, the crystal ball is malfunctioning --we must not invest using them. That said, it is very possible it could be different this time, but it is also very possible it's not different this time. We just don't know which, so it's totally non-actionable.

[CycloRista]

99 times out of 100 those who nailed a financial move from "seeing something that the market had not priced" were simply lucky.

+1

Completely agree

Anybody who says that they predicted something, didn’t

“Nobody knows nothing.” - John Bogle

+1

Multiple dumb luck outcomes have occurred for me since I joined the workforce in the '80's. I am grateful for each of them though not over-confident in my abilities or kidding myself that there is a way to control/predict multiple Niagara Falls' worth of digital financial data that blasts non-stop. At times the most difficult thing to do is nothing (particularly when many around us are in a total panic during times of crisis and making poor decisions).

My mother was young during the depression (oldest of six kids) and vividly remembered when her family lost their home. That event and the aftermath made her all the more determined to do her own investment homework, be skeptical but not foolish and ask lots of questions before making informed financial decisions.

She was an accomplished and diligent saver and investor (in addition to being more than an avid reader- quite often ~5 books at a time). I am also very thankful for how much of that knowledge found its way into my thick skull

[csantiago]

Sounds like it's about stoicism and zen then, which I can kind of get behind.

[doss]

But toilet paper in stock....

[abuss368]

I have learned during our investment journey that only the news tells us “it’s different this time”. I simply tune it out.

[Semantics]

I have learned during our investment journey that only the news tells us “it’s different this time”. I simply tune it out.

It is different this time - it's different every time. But your strategy doesn't need to be different.

[abuss368]

I have learned during our investment journey that only the news tells us “it’s different this time”. I simply tune it out.

It is different this time - it's different every time. But your strategy doesn't need to be different.

Exactly. Tune out the noise and don’t base any portfolio changes on noise! Based them on life changes to your personal situation.

[oldcomputerguy]

This topic has run its course and has derailed into a coronavirus discussion, and so and has been locked. See Please read before posting on coronavirus/COVID-19:

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[LadyGeek]

At a member's request, the coronavirus interchange has been removed. The main intent of the post must be on topic, which is investing.

This thread is unlocked to continue the discussion.

[Chicken Little]

“Nobody knows nothing.” - John Bogle

“Nobody knows nothing.” - Raymond

https://m.youtube.com/watch?v=fLCfkmaqI6k

[bigskyguy]

Please take this as a sincere question, because it is. For those who advocate unhesitatingly for "stay the course," which by the way I believe is a guiding principle that I find admirable and appropriate as a rule, are there any "external circumstances" (not personal ones, circumstances in the geopolitical, environmental, financial, or other, or some combination of events) that would in your mind justify abandoning, even temporarily, "staying the course?" As examples, were we to enter into a period of exceedingly high inflation (double digit, like the 70s), or have a prolonged recession/depression with 25% unemployment (like the 30s), or a period of true internal sociopolitical disruption (like the 1860s), or have a truly disruptive pandemic that killed 10% of the US population, would it matter to you?
I guess my question to you, is your commitment to "stay the course" absolute, or at all qualified? And if qualified, under what external circumstances?

[vineviz]

I guess my question to you, is your commitment to "stay the course" absolute, or at all qualified? And if qualified, under what external circumstances?

My view is that the principle is much closer to "absolute" than "qualified".

By the time an individual investor has confidently perceived that the "world has changed", the relative value of all their assets will undoubtedly have shifted to account for that.

For instance, the damage that inflation did in the 1970s was primarily due to prices consistently by MORE than was expected not to the rate of inflation being high per se. At the moment that an investor has realized that inflation is running hot, it'll be too late to switch from nominal bonds to TIPS (for instance) and get ahead of it. Unless the investor is BETTER at predicting future market changes than other investors, including institutional investors, which is highly unlikely.

So I think the only time to "change course" is when your own personal circumstances have changed, or possibly when you realize that your circumstances aren't what you thought they were.

[willthrill81]

Please take this as a sincere question, because it is. For those who advocate unhesitatingly for "stay the course," which by the way I believe is a guiding principle that I find admirable and appropriate as a rule, are there any "external circumstances" (not personal ones, circumstances in the geopolitical, environmental, financial, or other, or some combination of events) that would in your mind justify abandoning, even temporarily, "staying the course?" As examples, were we to enter into a period of exceedingly high inflation (double digit, like the 70s), or have a prolonged recession/depression with 25% unemployment (like the 30s), or a period of true internal sociopolitical disruption (like the 1860s), or have a truly disruptive pandemic that killed 10% of the US population, would it matter to you?
I guess my question to you, is your commitment to "stay the course" absolute, or at all qualified? And if qualified, under what external circumstances?

Many here claim that their adherence to 'buy and hold no matter what' is absolute, but if you read some of the threads from 2008, you'll find many were questioning that strategy and talking about 'plan B'. And that's just the people who were forthcoming about their concerns or actions. No doubt many panicked and never made it public.

[Chip]

Many here claim that their adherence to 'buy and hold no matter what' is absolute, but if you read some of the threads from 2008, you'll find many were questioning that strategy and talking about 'plan B'. And that's just the people who were forthcoming about their concerns or actions. No doubt many panicked and never made it public.

And, on the flip side, no doubt many didn't panic and never made it public.

It's pretty hard to draw any conclusions about Bogleheads in general from just those who post. I suspect (with no proof) that there are many who learn the principles, take them to heart and execute. Never to be seen here again.

[Normchad]

Please take this as a sincere question, because it is. For those who advocate unhesitatingly for "stay the course," which by the way I believe is a guiding principle that I find admirable and appropriate as a rule, are there any "external circumstances" (not personal ones, circumstances in the geopolitical, environmental, financial, or other, or some combination of events) that would in your mind justify abandoning, even temporarily, "staying the course?" As examples, were we to enter into a period of exceedingly high inflation (double digit, like the 70s), or have a prolonged recession/depression with 25% unemployment (like the 30s), or a period of true internal sociopolitical disruption (like the 1860s), or have a truly disruptive pandemic that killed 10% of the US population, would it matter to you?
I guess my question to you, is your commitment to "stay the course" absolute, or at all qualified? And if qualified, under what external circumstances?

That’s a great question!

For me, I cannot conceive of any combination of circumstances that would change what I am doing, and what I plan to do in the future.

I’ve been through dog.com, the GFC, and now COVID. I didn’t change anything during those times, and I’m very glad I didn’t. These experiences have only reinforced my resolve and conviction that I’m on the right path for me.

But what if the world basically comes to an end as we know it? If something that drastic happens, I think we are all just screwed. So changing course then won’t help me anyway.....

I’ll be interested to read what others think.

[warner25]

I guess my question to you, is your commitment to "stay the course" absolute, or at all qualified? And if qualified, under what external circumstances?

I think this mostly comes back to, "what's the alternative?" One thing that I've been trying to imagine are disruptive financial products that might make it worthwhile to radically change strategy, as I think common stocks and later low-cost index funds were in the beginning. Of course I don't know what that would be; maybe something like an available-to-all, Federally-backed, inflation-adjusted version of TIAA Traditional where you could fund your own DB pension on favorable terms.

[garlandwhizzer]

In general it is a good idea to stay the course but there are infrequent circumstances when it is appropriate IMO to slightly or modestly modify the plan. How do you know when to do that? There are no set rules for all. IMO it is useless to ask others for the answer whether they be experts or novices. Nobody does it perfectly. Those few who do it on average with success tend to have 2 things. First, a deep knowledge base about both who the macro-economy works and how the market works. Second, a lot of experience in investing which provides a long list of good and bad learning experiences in your prior attempts to do this. Investing experience is not a flawless teacher but it can an be an effective one sometimes to those who keep their eyes and their minds open.

Garland Whizzer

[willthrill81]

Many here claim that their adherence to 'buy and hold no matter what' is absolute, but if you read some of the threads from 2008, you'll find many were questioning that strategy and talking about 'plan B'. And that's just the people who were forthcoming about their concerns or actions. No doubt many panicked and never made it public.

And, on the flip side, no doubt many didn't panic and never made it public.

It's pretty hard to draw any conclusions about Bogleheads in general from just those who post. I suspect (with no proof) that there are many who learn the principles, take them to heart and execute. Never to be seen here again.

Correct. Selection bias is definitely present among posters.

[flaccidsteele]

A lot of newer forum participants have been surprised to see so many supposed Bogleheads panicking, selling low, market timing, picking individual stocks etc. They are surprised because they thought Bogleheads didn't do this stuff. Indeed, their mentor, Jack Bogle, said

I've said "Stay the course" a thousand times, and I meant it every time.

He meant it this time too, even if he isn't around to say it. Some of them are wondering if this mass Boglehead panic happened in 2008 too. While I'm nowhere near the oldest or most experienced Boglehead, I just wanted to reassure these newer members that yes, this happened in 2008 as well. There were lots of people who professed to be Bogleheads but didn't stay the course in 2008. Here are some examples. Feel free to add your own to the list.

viewtopic.php?t=33253

viewtopic.php?t=32624

viewtopic.php?t=32623

viewtopic.php?t=5934

viewtopic.php?t=25126

viewtopic.php?t=33849

Stay the course. We don't know how deep this bear will go. We don't know when it will end. But we do know two things:

# 1 It will end.
# 2 Those who continue to follow their reasonable written plan will be glad they did so on the other side of it while those who panicked and sold low will regret their actions.

Good luck investing. Stay healthy.

Edit: Maybe I'll start compiling threads here from this bear market too. Here's one:

viewtopic.php?p=5123733#p5123733

I don't want to say "I told you so" but this post pretty much called the bottom. I have no idea where the market goes from here (just as I didn't on March 22nd) but it is up 41% from March 22nd.

Stay the course.

+1 once an investor understands that the US market always recovers. Always. And that it’s never different this time. Ever. Investing then becomes stress-free, simple and mindless. Rinse and repeat until you’re tired of being wealthy

[carminered2019]

I changed the title "It's Different This Time With A Same Ending"

[dogagility]

Please take this as a sincere question, because it is. For those who advocate unhesitatingly for "stay the course," which by the way I believe is a guiding principle that I find admirable and appropriate as a rule, are there any "external circumstances" (not personal ones, circumstances in the geopolitical, environmental, financial, or other, or some combination of events) that would in your mind justify abandoning, even temporarily, "staying the course?" As examples, were we to enter into a period of exceedingly high inflation (double digit, like the 70s), or have a prolonged recession/depression with 25% unemployment (like the 30s), or a period of true internal sociopolitical disruption (like the 1860s), or have a truly disruptive pandemic that killed 10% of the US population, would it matter to you?
I guess my question to you, is your commitment to "stay the course" absolute, or at all qualified? And if qualified, under what external circumstances?

But what if the world basically comes to an end as we know it? If something that drastic happens, I think we are all just screwed. So changing course then won’t help me anyway.....

Yes. After the black swan and our portfolio collapses for good, that's when we move back to the homestead and start growing potatoes for year-round subsistence.

But... we don't invest as if this scenario will happen.

[LadyGeek]

I removed an off-topic post and reply. As a reminder, see: Politics and Religion

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[manatee2005]

A lot of newer forum participants have been surprised to see so many supposed Bogleheads panicking, selling low, market timing, picking individual stocks etc. They are surprised because they thought Bogleheads didn't do this stuff. Indeed, their mentor, Jack Bogle, said

I've said "Stay the course" a thousand times, and I meant it every time.

He meant it this time too, even if he isn't around to say it. Some of them are wondering if this mass Boglehead panic happened in 2008 too. While I'm nowhere near the oldest or most experienced Boglehead, I just wanted to reassure these newer members that yes, this happened in 2008 as well. There were lots of people who professed to be Bogleheads but didn't stay the course in 2008. Here are some examples. Feel free to add your own to the list.

viewtopic.php?t=33253

viewtopic.php?t=32624

viewtopic.php?t=32623

viewtopic.php?t=5934

viewtopic.php?t=25126

viewtopic.php?t=33849

Stay the course. We don't know how deep this bear will go. We don't know when it will end. But we do know two things:

# 1 It will end.
# 2 Those who continue to follow their reasonable written plan will be glad they did so on the other side of it while those who panicked and sold low will regret their actions.

Good luck investing. Stay healthy.

Edit: Maybe I'll start compiling threads here from this bear market too. Here's one:

viewtopic.php?p=5123733#p5123733

These are type of posts that kept me sane in March.

[stocknoob4111]

I had a goal to reach a certain number by next summer... well, I'm already there... I can't quite believe it really. This market is going nuts and I am getting skeptical this is legit but I guess these types of gains did happen in the 90s.

[john0608]

[OT comments removed by admin LadyGeek]

anyway - as i first posted in mid march during the covid meltdown....science will find a way....people on this board and elsewhere actually did move into t-bills and missed out on a huge run-up, an opportunity that was there...all they had to do was 'stay the course' which they have been told 99 times , who knows if the next bear will take us down to 19000 again, more likely this current covid vaccine bull surge make take a run to 35000 or so.

I know the year isn't over and there may be some mini corrections as soon as next week - but fyi one of my vang growth index funds is +49.5 ytd....which is incredible given the years events.

some advice - even if you have a panic attack try to leave 40 or 50% in equities and you won't regret it. I had rebalanced to 50/50 in Apr then re-rebalanced to 55/45 in June - now due to the runup - my AA is 62/38 and i have no reason to change anything.

wishing good healh and best wishes to all.