U.S. stocks in freefall

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VAslim16
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Re: U.S. stocks in freefall

Post by VAslim16 » Tue Jan 30, 2018 9:47 pm

laputan86 wrote:
Tue Jan 30, 2018 3:38 pm
Image
This is awesome...

MysticalMoose
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Re: U.S. stocks in freefall

Post by MysticalMoose » Tue Jan 30, 2018 9:49 pm

Bacchus01 wrote:
Tue Jan 30, 2018 9:35 pm
thangngo wrote:
Tue Jan 30, 2018 3:13 pm
Bacchus01 wrote:
Tue Jan 30, 2018 2:47 pm
My 401K contribution goes in tomorrow. This is awesome news!
If it's troubled water ahead, just be careful what you wish for.

Nope, not worried. Stay the course. I have a 50-year horizon.

If it dropped 50% tomorrow and I lost my job, we’d still be fine for years.
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with the consequences of global climate change and automation being able to outperform humans at most jobs?
Last edited by MysticalMoose on Tue Jan 30, 2018 9:59 pm, edited 1 time in total.

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willthrill81
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Re: U.S. stocks in freefall

Post by willthrill81 » Tue Jan 30, 2018 9:59 pm

MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bacchus01 wrote:
Tue Jan 30, 2018 9:35 pm
thangngo wrote:
Tue Jan 30, 2018 3:13 pm
Bacchus01 wrote:
Tue Jan 30, 2018 2:47 pm
My 401K contribution goes in tomorrow. This is awesome news!
If it's troubled water ahead, just be careful what you wish for.

Nope, not worried. Stay the course. I have a 50-year horizon.

If it dropped 50% tomorrow and I lost my job, we’d still be fine for years.
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with global climate change and automation being able to outperform humans at most jobs?
Even if you're fears about climate change come to pass, you can just live elsewhere.

People have been predicting that machines would kill all jobs for over one hundred years. Don't hold your breath.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

rudeboy
Posts: 90
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Re: U.S. stocks in freefall

Post by rudeboy » Tue Jan 30, 2018 10:09 pm

MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bacchus01 wrote:
Tue Jan 30, 2018 9:35 pm
thangngo wrote:
Tue Jan 30, 2018 3:13 pm
Bacchus01 wrote:
Tue Jan 30, 2018 2:47 pm
My 401K contribution goes in tomorrow. This is awesome news!
If it's troubled water ahead, just be careful what you wish for.

Nope, not worried. Stay the course. I have a 50-year horizon.

If it dropped 50% tomorrow and I lost my job, we’d still be fine for years.
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?
Good point. Hopefully brain matter will compound as quickly as your interest over the next 5 decades and we'll figure something out. I'm investing in low-cost index funds in case New York is still standing when I retire. If it isn't... :confused

MysticalMoose
Posts: 10
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Re: U.S. stocks in freefall

Post by MysticalMoose » Tue Jan 30, 2018 10:14 pm

willthrill81 wrote:
Tue Jan 30, 2018 9:59 pm
MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bacchus01 wrote:
Tue Jan 30, 2018 9:35 pm
thangngo wrote:
Tue Jan 30, 2018 3:13 pm
Bacchus01 wrote:
Tue Jan 30, 2018 2:47 pm
My 401K contribution goes in tomorrow. This is awesome news!
If it's troubled water ahead, just be careful what you wish for.

Nope, not worried. Stay the course. I have a 50-year horizon.

If it dropped 50% tomorrow and I lost my job, we’d still be fine for years.
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with global climate change and automation being able to outperform humans at most jobs?
Even if you're fears about climate change come to pass, you can just live elsewhere.

People have been predicting that machines would kill all jobs for over one hundred years. Don't hold your breath.
I can move, sure. Picking up half the financial centers of the world and plopping them somewhere else without major disruption is a different matter.

I work in automation....AI is still in its infancy but I see what it's capable of every day. I don't think we'll ever have synthetic humans running around but AI will undoubtedly be able to outperform humans at most jobs/tasks that we ourselves are capable of. We don't set a very high bar much of the time. :P

The world adjusts, but slowly. A lot of relatively fast changes are on trajectory to happen around the same time that I'd be cashing in on my 401k. Many people my age whom I've talked to have the same concerns but no one really knows how to address them, so they're left with skepticism. The stock market thrives on confidence.

What are some fundamental constants in human nature that we can count on to be predictable in an uncertain future, and can we use them in our financial strategies?

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willthrill81
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Re: U.S. stocks in freefall

Post by willthrill81 » Tue Jan 30, 2018 10:21 pm

MysticalMoose wrote:
Tue Jan 30, 2018 10:14 pm
What are some fundamental constants in human nature that we can count on to be predictable in an uncertain future, and can we use them in our financial strategies?
Greed.

Take advantage of it by owning the market.

With regard to your long-term concerns, I'll just say this: "2001: A Space Odyssey."
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

jef
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Re: U.S. stocks in freefall

Post by jef » Tue Jan 30, 2018 10:28 pm

MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm


I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with the consequences of global climate change and automation being able to outperform humans at most jobs?
Think about how bad things were in the past and how far we have come. In recent history, brutal wars, recessions and upheaval. Look at a chart of the US stock market since it began. Never bet against the U.S or world progress if your time horizon is long. Problems will be solved and opportunities to be had.

EnjoyIt
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Re: U.S. stocks in freefall

Post by EnjoyIt » Tue Jan 30, 2018 11:33 pm

MysticalMoose wrote:
Tue Jan 30, 2018 10:14 pm
willthrill81 wrote:
Tue Jan 30, 2018 9:59 pm
MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bacchus01 wrote:
Tue Jan 30, 2018 9:35 pm
thangngo wrote:
Tue Jan 30, 2018 3:13 pm


If it's troubled water ahead, just be careful what you wish for.

Nope, not worried. Stay the course. I have a 50-year horizon.

If it dropped 50% tomorrow and I lost my job, we’d still be fine for years.
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with global climate change and automation being able to outperform humans at most jobs?
Even if you're fears about climate change come to pass, you can just live elsewhere.

People have been predicting that machines would kill all jobs for over one hundred years. Don't hold your breath.
I can move, sure. Picking up half the financial centers of the world and plopping them somewhere else without major disruption is a different matter.

I work in automation....AI is still in its infancy but I see what it's capable of every day. I don't think we'll ever have synthetic humans running around but AI will undoubtedly be able to outperform humans at most jobs/tasks that we ourselves are capable of. We don't set a very high bar much of the time. :P

The world adjusts, but slowly. A lot of relatively fast changes are on trajectory to happen around the same time that I'd be cashing in on my 401k. Many people my age whom I've talked to have the same concerns but no one really knows how to address them, so they're left with skepticism. The stock market thrives on confidence.

What are some fundamental constants in human nature that we can count on to be predictable in an uncertain future, and can we use them in our financial strategies?
Nothing you mention above will happen instantly. While those changes occur very bright humans will take advantage of the situation building wealth in other areas. This processed has been happening for centuries. Industry disruptive tech just breads ingenuity and efficiency which leads to profits. I look forward to meeting our AI overlords.

RRAAYY3
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Re: U.S. stocks in freefall

Post by RRAAYY3 » Tue Jan 30, 2018 11:37 pm

Pre markets up - shocked !

visualguy
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Re: U.S. stocks in freefall

Post by visualguy » Tue Jan 30, 2018 11:42 pm

jef wrote:
Tue Jan 30, 2018 10:28 pm
Think about how bad things were in the past and how far we have come. In recent history, brutal wars, recessions and upheaval. Look at a chart of the US stock market since it began. Never bet against the U.S or world progress if your time horizon is long. Problems will be solved and opportunities to be had.
Unfortunately, most of us don't have much money available to invest when our time horizon is long... If and when we're finally settled enough to have some meaningful amount of income available to invest, our time horizon is not really all that long anymore.

sreynard
Posts: 293
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Re: U.S. stocks in freefall

Post by sreynard » Tue Jan 30, 2018 11:53 pm

MysticalMoose wrote:
Tue Jan 30, 2018 10:14 pm
The world adjusts, but slowly. A lot of relatively fast changes are on trajectory to happen around the same time that I'd be cashing in on my 401k. Many people my age whom I've talked to have the same concerns but no one really knows how to address them, so they're left with skepticism. The stock market thrives on confidence.

What are some fundamental constants in human nature that we can count on to be predictable in an uncertain future, and can we use them in our financial strategies?
You are mistaken. The world can, does, and has adjusted amazingly quickly, just as people have, do, and will. If it didn't, life would have been destroyed hundreds of millions of years ago. There have been earthquakes so massive rivers have flowed backwards. Fires so massive they burned not thousands of acres, but thousands of miles. There have been volcanoes dozens of miles across that spewed more noxious gasses than mankind has ever created. Not just one at a time, but in the dozens. And yes, the CO2 levels have been orders of magnitude higher than they are today. Terrible plagues have swept whole continents killing over half the population and can again at any time. All kinds of terrible things have happened in the past and worse could happen in the future. There really isn't a lot you or anybody can do about all that. You can do what you can to "save the environment" if it makes you feel better. You can worry about all the terrible things that can go wrong if it makes you happy. But recognize that every generation, at least since the beginning of recorded history, has feared the end was near. Some of them were even right and their civilization was wiped out, though usually not in the way they expected.

I have good friends that belong to what was once considered an "End of Times" church. A long time ago a bunch of member believed the end was coming so they quit their jobs, sold their homes, gave away all their possessions, and traveled to a mountaintop for the final day. Of course they were wrong. The sun did rise the next day. Oops! So a few years later, with better calculations, they tried again. Still didn't happen on schedule. Many people know the story and can tell it far better than I, but at least one of the lessons, is that you may actually survive, and then what ? What if the experts are wrong and those pending dooms you are worried about don't don't happen in 50 years, but in 500? Or 500,000? Then what will you do?

What you can do is take whatever prudent steps you can, for whatever the future holds, and hope for the best.

Or you can look on the bright side, like I do, if you die in some natural calamity you no longer need to worry about your 401K balance. Your retirement savings will have been sufficient. You didn't run out of money in retirement. :shock:

The fundamental constant in human nature is that we adapt and we overcome. No matter what.

Or, as they say, you can run around in circles and bite yourself in the small of the back about it. (Don't know what that means, but I read it in an old Science Fiction novel) Whatever makes you happy. :)

sreynard
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Re: U.S. stocks in freefall

Post by sreynard » Tue Jan 30, 2018 11:56 pm

EnjoyIt wrote:
Tue Jan 30, 2018 11:33 pm
I look forward to meeting our AI overlords.
I just hope the artificial kind proves smarter than the natural kind we've experienced so far.... :D

limeyx
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Re: U.S. stocks in freefall

Post by limeyx » Wed Jan 31, 2018 12:03 am

ruralavalon wrote:
Tue Jan 30, 2018 12:34 pm
Total market is down 0.98% so far today, this is second day in a row with a loss. We are all doomed :( :wink:
For sure! Double-doomed

MysticalMoose
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Re: U.S. stocks in freefall

Post by MysticalMoose » Wed Jan 31, 2018 12:11 am

sreynard wrote:
Tue Jan 30, 2018 11:53 pm
Whatever makes you happy. :)
Beer. Beer makes me happy. :sharebeer
sreynard wrote:
Tue Jan 30, 2018 11:56 pm
I just hope the artificial kind proves smarter than the natural kind we've experienced so far.... :D
Like I said, we really don't set a very high bar sometimes. :P

Whether it's natural or artificial, learning can only come from the data set your provide it. Humans are exposed to ~16 hours/day of regular tasks and encounters of daily life that a machine doesn't experience. AI learns a lot faster and a lot deeper than we do, but what it learns FROM is very different. The single most artificial thing about artificial intelligence is the controlled environment in which it is permitted to learn. AI can master certain tasks beyond the ability of any human but general intelligence is very difficult to acquire because of the lack of diversity in experiences. In comparison, humans would be the jacks of all trades and the masters of none.

Tangent aside, those responses were helpful. Thank you all!

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oldzey
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Re: U.S. stocks in freefall

Post by oldzey » Wed Jan 31, 2018 12:34 am

"The broker said the stock was 'poised to move.' Silly me, I thought he meant up." ― Randy Thurman

GoldenFinch
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Re: U.S. stocks in freefall

Post by GoldenFinch » Wed Jan 31, 2018 7:40 am

oldzey wrote:
Wed Jan 31, 2018 12:34 am
Oh, no - we're doomed!

https://www.youtube.com/watch?v=potlDrRI01A
^^^ Ha, ha! Thank you!

Bacchus01
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Re: U.S. stocks in freefall

Post by Bacchus01 » Wed Jan 31, 2018 8:21 am

MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bacchus01 wrote:
Tue Jan 30, 2018 9:35 pm
thangngo wrote:
Tue Jan 30, 2018 3:13 pm
Bacchus01 wrote:
Tue Jan 30, 2018 2:47 pm
My 401K contribution goes in tomorrow. This is awesome news!
If it's troubled water ahead, just be careful what you wish for.

Nope, not worried. Stay the course. I have a 50-year horizon.

If it dropped 50% tomorrow and I lost my job, we’d still be fine for years.
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with the consequences of global climate change and automation being able to outperform humans at most jobs?

That’s your take but it certainly isn’t making nstream and I disagree with just about everything you said.

Robots have been replacing people for decades and we still have labor shortages. I have a plant in MS where we have increased the number of robots 8X and we still have more people in the plant than 5 years ago

RRAAYY3
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Re: U.S. stocks in freefall

Post by RRAAYY3 » Wed Jan 31, 2018 8:40 am

visualguy wrote:
Tue Jan 30, 2018 11:42 pm
jef wrote:
Tue Jan 30, 2018 10:28 pm
Think about how bad things were in the past and how far we have come. In recent history, brutal wars, recessions and upheaval. Look at a chart of the US stock market since it began. Never bet against the U.S or world progress if your time horizon is long. Problems will be solved and opportunities to be had.
Unfortunately, most of us don't have much money available to invest when our time horizon is long... If and when we're finally settled enough to have some meaningful amount of income available to invest, our time horizon is not really all that long anymore.
This is why I invest monthly and budget accordingly - every little bit adds up (my taxable account is part of my retirement “package” so not touching anything in there for 20 years)

arsenalfan
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Re: U.S. stocks in freefall

Post by arsenalfan » Wed Jan 31, 2018 8:58 am

MysticalMoose wrote:
Tue Jan 30, 2018 10:14 pm
willthrill81 wrote:
Tue Jan 30, 2018 9:59 pm
MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bacchus01 wrote:
Tue Jan 30, 2018 9:35 pm
thangngo wrote:
Tue Jan 30, 2018 3:13 pm


If it's troubled water ahead, just be careful what you wish for.

Nope, not worried. Stay the course. I have a 50-year horizon.

If it dropped 50% tomorrow and I lost my job, we’d still be fine for years.
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with global climate change and automation being able to outperform humans at most jobs?
Even if you're fears about climate change come to pass, you can just live elsewhere.

People have been predicting that machines would kill all jobs for over one hundred years. Don't hold your breath.
I can move, sure. Picking up half the financial centers of the world and plopping them somewhere else without major disruption is a different matter.

I work in automation....AI is still in its infancy but I see what it's capable of every day. I don't think we'll ever have synthetic humans running around but AI will undoubtedly be able to outperform humans at most jobs/tasks that we ourselves are capable of. We don't set a very high bar much of the time. :P

The world adjusts, but slowly. A lot of relatively fast changes are on trajectory to happen around the same time that I'd be cashing in on my 401k. Many people my age whom I've talked to have the same concerns but no one really knows how to address them, so they're left with skepticism. The stock market thrives on confidence.

What are some fundamental constants in human nature that we can count on to be predictable in an uncertain future, and can we use them in our financial strategies?

Taking us further off course with this tangent but it's a fun one - if your worldview is of increasing automation/tech/AI, scarce resources, and massive infrastructure shifts, then I'd imagine you'd be researching ETFs in tech, water, consumer staples, and construction/development. And maybe placing sector bets.

Mea culpa I do have some discretionary/play money in a lithium ETF LIT because I think auto batteries will increase demand. But overall I subscribe to the theory that the human natures that sustain Capitalism will continue to ensure the Market adapts to these fast changes.

Jags4186
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Re: U.S. stocks in freefall

Post by Jags4186 » Wed Jan 31, 2018 9:10 am

I wouldn't worry about "financial centers" getting destroyed. Not like there is some secret sauce that makes NYC special. It's special because it's old and historical reasons.

If NYC is under 20 feet of water there are plenty of inland cities...that can be our new financial center. If you're really worried move to Denver. Most likely won't be under the ocean anytime soon. You could be ahead of the pack! :wink:

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ruralavalon
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Re: U.S. stocks in freefall

Post by ruralavalon » Wed Jan 31, 2018 9:14 am

MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bacchus01 wrote:
Tue Jan 30, 2018 9:35 pm
thangngo wrote:
Tue Jan 30, 2018 3:13 pm
Bacchus01 wrote:
Tue Jan 30, 2018 2:47 pm
My 401K contribution goes in tomorrow. This is awesome news!
If it's troubled water ahead, just be careful what you wish for.

Nope, not worried. Stay the course. I have a 50-year horizon.

If it dropped 50% tomorrow and I lost my job, we’d still be fine for years.
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with the consequences of global climate change and automation being able to outperform humans at most jobs?
Predictions are not facts, just opinions.

There were predictions about a "population bomb" which was going to cause world-wide mass famine, and a "Y2k" computer glitch that would send us all back to using slide rules or pencil and paper to compute.

Predicted catastrophes sometimes don't happen, and when they do we just adapt. So I suggest that you contribute to your 401k anyway.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

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oldcomputerguy
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Re: U.S. stocks in freefall

Post by oldcomputerguy » Wed Jan 31, 2018 9:48 am

willthrill81 wrote:
Tue Jan 30, 2018 10:21 pm
With regard to your long-term concerns, I'll just say this: "2001: A Space Odyssey."
Add to this:

1997: the launch of the Jupiter 2
2010: Dr. Chandra goes to Jupiter and the Discovery to resuscitate HAL
2015: Marty McFly, his girlfriend Jennifer, and Dr. Emmett Brown arrive from the year 1985

Nobody knows nuthin'.
It’s taken me a lot of years, but I’ve come around to this: If you’re dumb, surround yourself with smart people. And if you’re smart, surround yourself with smart people who disagree with you.

DanMahowny
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Re: U.S. stocks in freefall

Post by DanMahowny » Wed Jan 31, 2018 11:16 am

thangngo wrote:
Tue Jan 30, 2018 7:37 pm
I'm curious.. do you have a sizable cash on the sideline all the time waiting for the next crash?
I'm around 30% equities, 70% cash/short-term bonds. Been this way for a couple months.

I hit "my number" and feel confident that I have "enough" now, so I didn't feel like losing big if the market crashed.

However, if the market declines by 40%-50%, I'll probably move to a 50/50 allocation.

And if equities continue to grow forever, that's ok too.

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MichaelRpdx
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Re: U.S. stocks in freefall

Post by MichaelRpdx » Wed Jan 31, 2018 11:37 am

MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with the consequences of global climate change and automation being able to outperform humans at most jobs?
The people who manage those financial centers are aware of the possibility. They will make and execute plans to move as needed.

Last fall I retired from a big bank, not one of the big five, but very close. During my tenure that started in the early 90s three data centers were built and populated. One of them because the existing primary data center could no longer be provisioned with enough electricity to grow operations. Redundant, geographically diverse operations are the norm for these organizations. They are prepared for unexpected changes in the short and long term. (And don't get me started on the weekends I'd get up at 4:00am for a business continuity exercise. We'd literally move all operations out of a data center to be sure we could in the event of some disaster. I live on the west coast, the exercises started at 7:00am corporate headquarters time.)

If we were to frame your question in a perspective from the 1960s, it might have be "if it happens that the many of the world's financial centers literally being nuclear waste heaps?" In aggregate, humans work together to enable our lives to go forward.

Consider the alternative. You don't save. You don't grow assets. Your city becomes uninhabitable. You cannot afford to move to wherever people are living now. The jobs are taken. Housing prices are obscene. And you have nothing to assist you in adapting to a new life somewhere.
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Re: U.S. stocks in freefall

Post by roymeo » Wed Jan 31, 2018 2:21 pm

MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with the consequences of global climate change and automation being able to outperform humans at most jobs?
I'm investing in the market, because I think many of those companies will be able to continue make money despite the slow (and fast) change that will happen in the future. Despite the earthquake and tsunami and nuclear accident, Japan is still there, people are still buying things, making things, etc. Even if water levels rise 2 meters in a night, there will be people going to work the next day, dealing with the mess, cleaning up, finding new solutions to problems. The 2 towers of the WTC were taken down one day in 2001 and a lot of financial businesses lost people and property and records there, but the economy and businesses recovered.
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Re: U.S. stocks in freefall

Post by MysticalMoose » Wed Jan 31, 2018 2:26 pm

I'm a novice with regard to investments because I've kind of always viewed the whole thing with some skepticism. "Save away money in preparation for the distant future" and "don't worry- the future will be fine because we'll just adapt if something happens" seem to send mixed messages. How proactive should we be in assessing risks for the future and responding to them now?

Like others have said, history is full of predictions about the future that never came true. It's just that the archaeological record is also full of examples of civilizations that didn't make it. We don't think of that as much because history books are written by the survivors, from whom we are descended. Adaptation will always be attempted but it is never guaranteed to succeed.

You increase your odds of success by covering your bases. So I continue to put money in my 401k in case we still have the same economic model in 50 years. But our current economic model may be forced to change. Capitalism requires increasing growth and increasing consumption of resources year after year, and increasing population to fuel it.

Many of our resources are already being depleted beyond replacement level. Cape Town runs out of water in 3 months. What happens then? They'll adapt, hopefully, but not without strife. That has economic consequences that especially suck if they happen as you're trying to retire.

Population in Western nations is leveling off. Japan is already trying to cope with the financial strain of not having enough new blood. Automation will help boost productivity, but will they become so productive that Guaranteed Basic Income becomes necessary? I think that just like people, our economic models will have to adapt to changing circumstances. So for example, if we end up with GBI, how would that impact the stock market? I agree that whatever system we have will rely on fundamental constants in human nature (like greed) but the way it looks and operates might change.

Assessing risks is important, but how do we optimize covering our bases in the face of so many unknowns? How proactively should we attempt to prepare for the long-term? You can't prepare for everything, but shouldn't we at least try to respond to red flags?

ETA: I agree that we should always save and try to prepare for the future. I just have misgivings about the tools we use to do it.

arsenalfan wrote:
Wed Jan 31, 2018 8:58 am
Taking us further off course with this tangent but it's a fun one - if your worldview is of increasing automation/tech/AI, scarce resources, and massive infrastructure shifts, then I'd imagine you'd be researching ETFs in tech, water, consumer staples, and construction/development. And maybe placing sector bets.

Mea culpa I do have some discretionary/play money in a lithium ETF LIT because I think auto batteries will increase demand. But overall I subscribe to the theory that the human natures that sustain Capitalism will continue to ensure the Market adapts to these fast changes.
Yeah I think electric cars and anything relating to clean energy will grow as the need for it becomes more apparent. I'd also watch Google (and I suppose Microsoft) for their work in quantum computing. Much like AI and robotics, there are decades of lofty promises with no return and then suddenly a breakthrough that takes it mainstream. Nature of the beast.

Regular computers will continue to be sufficient for most of the things we currently use them for. If all you're doing is adding 2 + 2, you won't notice the difference between an i7 processor vs an i3. Advanced video editing or gaming, you WILL notice. Similar premise with quantum. When that arrives, it will bring with it the added power needed for truly advanced AI and complex simulations. For instance, simulating interactions between molecules and chemicals. Look to gains in drug development when quantum computing (eventually) gets here.

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Re: U.S. stocks in freefall

Post by RRAAYY3 » Wed Jan 31, 2018 2:51 pm

here's how i sleep at night

1. this world has always been a chaotic mess. now we just have smartphones and the internet shoving it in our face 24/7. "Noise".

2. buy TOTAL US / TOTAL INT/L index funds. wait.

3. #2 will grow in value overtime - and if they don't, you [and the world] have bigger issues than your investment strategy.

may not be the most optimistic, but my investments are going to grow - or it means something very, very bad has gone wrong so whatever might as well "play the game"
Last edited by RRAAYY3 on Wed Jan 31, 2018 2:56 pm, edited 2 times in total.

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Re: U.S. stocks in freefall

Post by DanMahowny » Wed Jan 31, 2018 2:55 pm

solid advice RRAAYY3

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Re: U.S. stocks in freefall

Post by MysticalMoose » Wed Jan 31, 2018 2:57 pm

RRAAYY3 wrote:
Wed Jan 31, 2018 2:51 pm
here's how i sleep at night

1. this world has always been a chaotic mess. now we just have smartphones and the internet shoving it in our face 24/7. "Noise".

2. buy TOTAL US / TOTAL INT/L index funds. wait.

3. #2 will grow in value overtime - and if they don't, you [and the world] have bigger issues than your investment strategy.

may not be the most optimistic, but my investments are going to grow - or it means something very, very bad has gone wrong so whatever might as well "play the game"
Fair enough. :P Can't argue with that.

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Re: U.S. stocks in freefall

Post by RRAAYY3 » Wed Jan 31, 2018 3:07 pm

haha thanks; Sometimes I say it to people when they fear or are hesitant to take on the “risk” of stocks ... I usually counter with, don’t buy stock - buy all of them - and only with money you don’t need for 3-5 years. I also consider equities more volatile than actually risky, but I get the concern.

“What if they never go up ?!” - Then the world’s likely coming to an end and your cash under the mattress won’t be worth anything either.

There’s an interesting look on people’s face after that - a mix of horror and “hmm, great point”

Index funds - beautifully boring. (Somewhat related, I’m 50/50 with Int’l since I don’t have as much confidence in the US “world leadership” continuing - I’ll let the markets dictate for me)

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Re: U.S. stocks in freefall

Post by oldzey » Wed Jan 31, 2018 3:50 pm

oldcomputerguy wrote:
Wed Jan 31, 2018 9:48 am
willthrill81 wrote:
Tue Jan 30, 2018 10:21 pm
With regard to your long-term concerns, I'll just say this: "2001: A Space Odyssey."
Add to this:

1997: the launch of the Jupiter 2
2010: Dr. Chandra goes to Jupiter and the Discovery to resuscitate HAL
2015: Marty McFly, his girlfriend Jennifer, and Dr. Emmett Brown arrive from the year 1985

Nobody knows nuthin'.
2019: Roy Batty tells Eldon Tyrell, "I want more life..."
2030: The Dow hits 100,000
2049: Rick Deckard meets somebody.
Last edited by oldzey on Wed Jan 31, 2018 5:38 pm, edited 1 time in total.
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Re: U.S. stocks in freefall

Post by oldcomputerguy » Wed Jan 31, 2018 5:49 pm

oldzey wrote:
Wed Jan 31, 2018 3:50 pm
oldcomputerguy wrote:
Wed Jan 31, 2018 9:48 am
willthrill81 wrote:
Tue Jan 30, 2018 10:21 pm
With regard to your long-term concerns, I'll just say this: "2001: A Space Odyssey."
Add to this:

1997: the launch of the Jupiter 2
2010: Dr. Chandra goes to Jupiter and the Discovery to resuscitate HAL
2015: Marty McFly, his girlfriend Jennifer, and Dr. Emmett Brown arrive from the year 1985

Nobody knows nuthin'.
2019: Roy Batty tells Eldon Tyrell, "I want more life..."
2030: The Dow hits 100,000
2049: Rick Deckard meets somebody.
Yeah, but my point was that the events I mentioned supposedly already happened in history; those dates have passed, and none of that stuff has happened.
It’s taken me a lot of years, but I’ve come around to this: If you’re dumb, surround yourself with smart people. And if you’re smart, surround yourself with smart people who disagree with you.

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Re: U.S. stocks in freefall

Post by sreynard » Wed Jan 31, 2018 11:31 pm

oldcomputerguy wrote:
Wed Jan 31, 2018 5:49 pm
oldzey wrote:
Wed Jan 31, 2018 3:50 pm
oldcomputerguy wrote:
Wed Jan 31, 2018 9:48 am
willthrill81 wrote:
Tue Jan 30, 2018 10:21 pm
With regard to your long-term concerns, I'll just say this: "2001: A Space Odyssey."
Add to this:

1997: the launch of the Jupiter 2
2010: Dr. Chandra goes to Jupiter and the Discovery to resuscitate HAL
2015: Marty McFly, his girlfriend Jennifer, and Dr. Emmett Brown arrive from the year 1985

Nobody knows nuthin'.
2019: Roy Batty tells Eldon Tyrell, "I want more life..."
2030: The Dow hits 100,000
2049: Rick Deckard meets somebody.
Yeah, but my point was that the events I mentioned supposedly already happened in history; those dates have passed, and none of that stuff has happened.
You forgot:

1967: Flying cars become popular!
Image

I think they've been 10 years away every year since the '30s.

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Re: U.S. stocks in freefall

Post by willthrill81 » Wed Jan 31, 2018 11:45 pm

When it comes to our lifetime, it seems that the future becomes the present faster and faster.

When it comes to predictions, it seems that the 'future' rarely becomes the present.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: U.S. stocks in freefall

Post by sreynard » Thu Feb 01, 2018 12:22 am

willthrill81 wrote:
Wed Jan 31, 2018 11:45 pm
When it comes to our lifetime, it seems that the future becomes the present faster and faster.

When it comes to predictions, it seems that the 'future' rarely becomes the present.
Well said! :beer

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Re: U.S. stocks in freefall

Post by Crisium » Thu Feb 01, 2018 8:50 am

If you're really worried about the collapse of civilization put some (not too much now) money into survivalist bug out stuff. Water filters, solar generator, guns and ammo, food and water supply, camping gear, etc. But yeah, 401k first and foremost.

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Re: U.S. stocks in freefall

Post by fposte » Thu Feb 01, 2018 9:41 am

MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with the consequences of global climate change and automation being able to outperform humans at most jobs?
The odds of being in trouble because you don't have money saved are considerably higher than the odds of being in trouble because you do.

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Re: U.S. stocks in freefall

Post by Da5id » Thu Feb 01, 2018 9:51 am

fposte wrote:
Thu Feb 01, 2018 9:41 am
MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with the consequences of global climate change and automation being able to outperform humans at most jobs?
The odds of being in trouble because you don't have money saved are considerably higher than the odds of being in trouble because you do.
Yes. "I won't save because it all might be different in X years" feels like a rationalization to spend freely now. Hard to imagine a non-apocalyptic future where savings aren't useful.

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Re: U.S. stocks in freefall

Post by JoMoney » Thu Feb 01, 2018 10:36 am

MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with the consequences of global climate change and automation being able to outperform humans at most jobs?
If "climate change" brings some unusual level of catastrophe, that might mean more jobs doing terraforming and/or rebuilding infrastructure or whatever. Automation might change lots of old-tech low-skill jobs into a few new-tech high-skilled highly complex jobs maintaining the new system, but I don't share the pseudo-Utopian view that we'll run out of things to do even at a low-skill level. Even if not everyone is smart enough to be working on the super complex new automated systems, or creative enough to be making new better stuff we haven't thought of, it's just the nature of things to always be wearing down and needing maintenance, weeds growing in every garden, always something to be cleaning up and maintaining the current mode of operation. People who think we're one step away from running out of things to do aren't looking very hard.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

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Re: U.S. stocks in freefall

Post by lostdog » Fri Feb 02, 2018 10:38 am

RBD today?
100% Vanguard Total World Equity Index. Simplicity 100%.

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Re: U.S. stocks in freefall

Post by CULater » Fri Feb 02, 2018 10:49 am

Dow industrials risk 730-point weekly drop — biggest one-week setback in 2 years
May you have the hindsight to know where you've been, The foresight to know where you're going, And the insight to know when you've gone too far. ~ Irish Blessing

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Re: U.S. stocks in freefall

Post by masteraleph » Fri Feb 02, 2018 10:50 am

As a reminder- a 700 point drop in a week from Dow 26000 is very different from a 700 point drop in a day from Dow 11000.

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Re: U.S. stocks in freefall

Post by Da5id » Fri Feb 02, 2018 10:54 am

CULater wrote:
Fri Feb 02, 2018 10:49 am
Dow industrials risk 730-point weekly drop — biggest one-week setback in 2 years
Dropping us all the way back to where the Dow was in mid January, oh the humanity. This could be the start of a big slide, surely some day one will come again. Or not. But until we have given back a bit more of the 6000 point the Dow has gained in the past year seems a bit early to say the sky is falling.

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Re: U.S. stocks in freefall

Post by ImmigrantSaver » Fri Feb 02, 2018 10:55 am

lostdog wrote:
Fri Feb 02, 2018 10:38 am
RBD today?
Good question. I have 2k to put in between now and the end of February (50/50 VXUS and VBR as I am underweight in both). Do I do it now or do I wait.. Decisions decisions..

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Re: U.S. stocks in freefall

Post by RRAAYY3 » Fri Feb 02, 2018 10:57 am

Freefalling all the way back to mid January valuations [as in, still up for the year].

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Re: U.S. stocks in freefall

Post by roflwaffle » Fri Feb 02, 2018 11:06 am

willthrill81 wrote:
Tue Jan 30, 2018 9:59 pm
MysticalMoose wrote:
Tue Jan 30, 2018 9:49 pm
Bacchus01 wrote:
Tue Jan 30, 2018 9:35 pm
thangngo wrote:
Tue Jan 30, 2018 3:13 pm
Bacchus01 wrote:
Tue Jan 30, 2018 2:47 pm
My 401K contribution goes in tomorrow. This is awesome news!
If it's troubled water ahead, just be careful what you wish for.

Nope, not worried. Stay the course. I have a 50-year horizon.

If it dropped 50% tomorrow and I lost my job, we’d still be fine for years.
I'm admittedly a total novice, but I don't understand the long-term perspective when it comes to stocks. My 401k is about 50 years out but I have doubts about its eventual usefulness. My city (and many major coastal cities, most of which are financial centers) are projected to be dealing with bad flooding due to climate change right around the time I'm supposed to retire. Even if I accumulate 5 decades of compound interest, will I be able to cash out when I need to if it happens to overlap with many of the world's financial centers literally being underwater?

Bogle's philosophy makes sense to me for the world we currently live in. But it feels like there are so many indications that that world will change. How do you take the long-view in investment strategy when you half-expect the underlying assumptions about the world and the economy to no longer be relevant when confronted with global climate change and automation being able to outperform humans at most jobs?
Even if you're fears about climate change come to pass, you can just live elsewhere.

People have been predicting that machines would kill all jobs for over one hundred years. Don't hold your breath.
To be fair, machines have killed plenty of jobs over the past hundred years, and many more jobs have taken their place.

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Re: U.S. stocks in freefall

Post by PugetSoundguy » Fri Feb 02, 2018 11:12 am

At least the federal Thrift Savings Plan G-fund rate went up to 2.75% today (up from January rate of 2.375%).

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Re: U.S. stocks in freefall

Post by itsgot8 » Fri Feb 02, 2018 11:21 am

ImmigrantSaver wrote:
Fri Feb 02, 2018 10:55 am
Good question. I have 2k to put in between now and the end of February (50/50 VXUS and VBR as I am underweight in both). Do I do it now or do I wait.. Decisions decisions..
So, attempt to time the market? :D

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Re: U.S. stocks in freefall

Post by thangngo » Fri Feb 02, 2018 11:27 am

On a day like this, some people will see their portfolio lose in value similar to the cost of a luxury European car.

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Re: U.S. stocks in freefall

Post by RRAAYY3 » Fri Feb 02, 2018 11:32 am

thangngo wrote:
Fri Feb 02, 2018 11:27 am
On a day like this, some people will see their portfolio lose in value similar to the cost of a luxury European car.
and others will wisely invest the cash they saved not buying a luxury European car

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