U.S. stocks in freefall

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RRAAYY3
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Re: U.S. stocks in freefall

Post by RRAAYY3 » Mon Apr 02, 2018 1:11 pm

welp, INT'L is dropping less than US ... thanks diversification ?

MotoTrojan
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Re: U.S. stocks in freefall

Post by MotoTrojan » Mon Apr 02, 2018 1:12 pm

RetireBy55 wrote:
Mon Apr 02, 2018 1:08 pm
WhiteMaxima wrote:
Mon Apr 02, 2018 1:03 pm
Hard cold cash is still the King.
Yep - and that's why I'm personally 50+% cash and always have been. I'll take the ~2.5% divvys and pay a good chunk of my bills with that..

The market has basically become one big casino IMHO. We've long left the days of stocks trading on actual fundamentals, and every little perceived piece of news sends the market one way or the other into a spastic tizzy.

I know it's very non-BH to say this, but B&H is dead. The "instant information", constant articles causing herd stampedes and all the similar noise has killed B&H for good IMHO.
As a B&H'r, why do you care about the daily swings, if long-term things maintain reasonable balance? I don't think the movement we have seen on a 1-6 month scale is historically significant at all. Do you disagree?

RetireBy55
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Re: U.S. stocks in freefall

Post by RetireBy55 » Mon Apr 02, 2018 1:15 pm

MotoTrojan wrote:
Mon Apr 02, 2018 1:12 pm
As a B&H'r, why do you care about the daily swings, if long-term things maintain reasonable balance? I don't think the movement we have seen on a 1-6 month scale is historically significant at all. Do you disagree?
Key word being "IF".

I'm < 12 months from retirement. Not sure how many years I'll live, so not looking at a 30+ year timeframe. I care about the next 10-20 and am one of those people that don't like to see multiple $100K chunk movements in my portfolio to the down direction, ESPECIALLY before I'm getting ready to pull the rip cord and retire. And if we have another 2000-2009 (or whatever it was), that'll sure suck.

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oldcomputerguy
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Re: U.S. stocks in freefall

Post by oldcomputerguy » Mon Apr 02, 2018 1:18 pm

RetireBy55 wrote:
Mon Apr 02, 2018 11:11 am
Herd mentality is taking over. Fundamentals don't seem to matter for squat at the moment.
It seems to me that the herd mentality, rather than fundamentals, has been driving the market for about the last year-and-a-half. Only thing is, the herd is now panicking.

If we're gonna have a bear, then bring it on. DW is working for the next two-minus years before she qualifies for full pension. If we can get a bear out of the way before that point arrives, I'll be a happy camper. :mrgreen:
Last edited by oldcomputerguy on Mon Apr 02, 2018 1:21 pm, edited 1 time in total.
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 bgf » Mon Apr 02, 2018 1:19 pm

RetireBy55 wrote:
Mon Apr 02, 2018 1:08 pm
WhiteMaxima wrote:
Mon Apr 02, 2018 1:03 pm
Hard cold cash is still the King.
The market has basically become one big casino IMHO. We've long left the days of stocks trading on actual fundamentals, and every little perceived piece of news sends the market one way or the other into a spastic tizzy.
psst... the market has ALWAYS been this way.
“TE OCCIDERE POSSUNT SED TE EDERE NON POSSUNT NEFAS EST"

grettman
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Re: U.S. stocks in freefall

Post by grettman » Mon Apr 02, 2018 1:22 pm

While a 10% drop in the markets is called a correction....

It isn't a real correction until the CASH IS KING and BUY GOLD crowd start coming out of the woodwork! I think we are here folks.

It will also be a noteworthy period when the "What are you up YTD?" and "FIRE" crowd starts to chatter with negativity in a big way (or go silent).

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Chan_va
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Re: U.S. stocks in freefall

Post by Chan_va » Mon Apr 02, 2018 1:22 pm

Folks,

There is a reason Equity Risk Premium has the word "Risk" in it. People have been lulled by the relentless rise of the market over the past few years. That is not normal. The equity market has always been volatile. It's precisely times like this when sticking to your AA matters most.

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willthrill81
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Re: U.S. stocks in freefall

Post by willthrill81 » Mon Apr 02, 2018 1:22 pm

oldcomputerguy wrote:
Mon Apr 02, 2018 1:18 pm
RetireBy55 wrote:
Mon Apr 02, 2018 11:11 am
Herd mentality is taking over. Fundamentals don't seem to matter for squat at the moment.
It seems to me that the herd mentality, rather than fundamentals, has been driving the market for about the last year-and-a-half. Only thing is, the herd is now panicking.

If we're gonna have a bear, then bring it on. DW is working for the next two-minus years before she qualifies for full pension. If we can get a bear out of the way before that point arrives, I'll be a happy camper. :mrgreen:
All of this recent volatility may actually prevent a bear market from taking hold, if it can weed out some of the 'nervous nellies'.
“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 Whakamole » Mon Apr 02, 2018 1:23 pm

I had been holding the short-term muni bond fund VWSUX in taxable as a way to get a better rate on cash. With the change in tax rates, the short-term Treasury fund pays better (and has a lower minimum for Admiral shares.) While changing funds, I'm taking some of the proceeds and buying Total International and Total Stock, since I'll need to rebalance after today is over anyway.

robertmcd
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Re: U.S. stocks in freefall

Post by robertmcd » Mon Apr 02, 2018 1:24 pm

What the heck happened to my 25% APY money market account that I had in 2017!!??

Seasonal
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Re: U.S. stocks in freefall

Post by Seasonal » Mon Apr 02, 2018 1:24 pm

triceratop wrote:
Mon Apr 02, 2018 10:37 am
Okay but even then I don’t see a problem. I was actually panicking in January and the market was shooting up. That is bad news for accumulators. A market that is going sideways is excellent for savers.
That depends entirely on what the market does in the future. For example, if the market is down because participants are accurately forecasting lower future growth as a result of new information, that's not good news for savers. On the other hand, if the market is down due to an overreaction to something and will go to a long-term higher trend, that is good news for savers.

Given a specific future price at a specific future time, lower price today is unambiguously good - you're getting a bargain compared to higher recent prices. However, it's possible the price is lower today for a good reason and as a result savers will be worse off.

A lower price can represent better value or it can represent lower quality. With the market it's hard to tell.

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JoMoney
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Re: U.S. stocks in freefall

Post by JoMoney » Mon Apr 02, 2018 1:25 pm

Chuck wrote:
Mon Apr 02, 2018 1:16 pm
...Then, tariffs and trade wars were brought out, and advocated as a "good thing," when anyone reasonably familiar with economics knows that additional taxes on anything are a drag on the economy, most of all, on steel and aluminum. (Gosh, steel and aluminum aren't in anything important, are they?) ...
They may very well be a "good thing" for wage earners, less likely to be good for those looking at profit margins. In some of the reports there has been offers of reduced duties on things like cars if the plants they're produced in pay higher wages... anyway around it, none of it seems to be set in stone and "deals" to be made, which I'm sure the markets will react to with big "adjustments".
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

Accrual
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Re: U.S. stocks in freefall

Post by Accrual » Mon Apr 02, 2018 1:27 pm

grettman wrote:
Mon Apr 02, 2018 1:22 pm
While a 10% drop in the markets is called a correction....

It isn't a real correction until the CASH IS KING and BUY GOLD crowd start coming out of the woodwork! I think we are here folks.

It will also be a noteworthy period when the "What are you up YTD?" and "FIRE" crowd starts to chatter with negativity in a big way (or go silent).
Let us not forget the 100/0 allocation folks.

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JoMoney
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Re: U.S. stocks in freefall

Post by JoMoney » Mon Apr 02, 2018 1:28 pm

Accrual wrote:
Mon Apr 02, 2018 1:27 pm
grettman wrote:
Mon Apr 02, 2018 1:22 pm
While a 10% drop in the markets is called a correction....

It isn't a real correction until the CASH IS KING and BUY GOLD crowd start coming out of the woodwork! I think we are here folks.

It will also be a noteworthy period when the "What are you up YTD?" and "FIRE" crowd starts to chatter with negativity in a big way (or go silent).
Let us not forget the 100/0 allocation folks.
I wonder if any of them will go to 110/-10
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

bgf
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Re: U.S. stocks in freefall

Post by bgf » Mon Apr 02, 2018 1:29 pm

Accrual wrote:
Mon Apr 02, 2018 1:27 pm
grettman wrote:
Mon Apr 02, 2018 1:22 pm
While a 10% drop in the markets is called a correction....

It isn't a real correction until the CASH IS KING and BUY GOLD crowd start coming out of the woodwork! I think we are here folks.

It will also be a noteworthy period when the "What are you up YTD?" and "FIRE" crowd starts to chatter with negativity in a big way (or go silent).
Let us not forget the 100/0 allocation folks.
that's me!
“TE OCCIDERE POSSUNT SED TE EDERE NON POSSUNT NEFAS EST"

bgf
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Re: U.S. stocks in freefall

Post by bgf » Mon Apr 02, 2018 1:31 pm

JoMoney wrote:
Mon Apr 02, 2018 1:28 pm
Accrual wrote:
Mon Apr 02, 2018 1:27 pm
grettman wrote:
Mon Apr 02, 2018 1:22 pm
While a 10% drop in the markets is called a correction....

It isn't a real correction until the CASH IS KING and BUY GOLD crowd start coming out of the woodwork! I think we are here folks.

It will also be a noteworthy period when the "What are you up YTD?" and "FIRE" crowd starts to chatter with negativity in a big way (or go silent).
Let us not forget the 100/0 allocation folks.
I wonder if any of them will go to 110/-10
i suppose i'm 200/-100 if you accept a mortgage as negative bond exposure.
“TE OCCIDERE POSSUNT SED TE EDERE NON POSSUNT NEFAS EST"

Pelerus
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Re: U.S. stocks in freefall

Post by Pelerus » Mon Apr 02, 2018 1:35 pm

Wow, seeing the reactions here to the daily price swings has me thinking that if we do see a protracted bear, this place could easily become a ghost town, haunted only by bitter and vengeful spirits. :twisted: Or maybe it will just shake out the weak hands, leaving only the true believers spinning their prayer wheels.

But in all seriousness, I sure wouldn’t want to be unhedged or cash light right now, and I sympathize with those who are.

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JoMoney
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Re: U.S. stocks in freefall

Post by JoMoney » Mon Apr 02, 2018 1:37 pm

bgf wrote:
Mon Apr 02, 2018 1:31 pm
... i suppose i'm 200/-100 if you accept a mortgage as negative bond exposure.
It is if you look at your entire net worth in aggregate, and consider your home equity a self-landlord business where the 'imputed rent' for living in the home is pseudo tax-free earnings/income.
Last edited by JoMoney on Mon Apr 02, 2018 1:37 pm, edited 1 time in total.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

missingdonut
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Re: U.S. stocks in freefall

Post by missingdonut » Mon Apr 02, 2018 1:37 pm

bgf wrote:
Mon Apr 02, 2018 1:19 pm
RetireBy55 wrote:
Mon Apr 02, 2018 1:08 pm
The market has basically become one big casino IMHO. We've long left the days of stocks trading on actual fundamentals, and every little perceived piece of news sends the market one way or the other into a spastic tizzy.
psst... the market has ALWAYS been this way.
+1000

The market has always been as imperfect as its investors... it's not that Joe Kennedy received stock tips from his shoeshine boy last week, after all!

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F150HD
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Re: U.S. stocks in freefall

Post by F150HD » Mon Apr 02, 2018 1:41 pm

if this jagged staccato decline keeps continuing thru 2018 are they still going to be bumping up interest rates 2-3 more times?

MotoTrojan
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Re: U.S. stocks in freefall

Post by MotoTrojan » Mon Apr 02, 2018 1:43 pm

bgf wrote:
Mon Apr 02, 2018 1:29 pm
Accrual wrote:
Mon Apr 02, 2018 1:27 pm
grettman wrote:
Mon Apr 02, 2018 1:22 pm
While a 10% drop in the markets is called a correction....

It isn't a real correction until the CASH IS KING and BUY GOLD crowd start coming out of the woodwork! I think we are here folks.

It will also be a noteworthy period when the "What are you up YTD?" and "FIRE" crowd starts to chatter with negativity in a big way (or go silent).
Let us not forget the 100/0 allocation folks.
that's me!
Me too and hoping this trend continues.

minimalistmarc
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Re: U.S. stocks in freefall

Post by minimalistmarc » Mon Apr 02, 2018 1:43 pm

bgf wrote:
Mon Apr 02, 2018 1:29 pm
Accrual wrote:
Mon Apr 02, 2018 1:27 pm
grettman wrote:
Mon Apr 02, 2018 1:22 pm
While a 10% drop in the markets is called a correction....

It isn't a real correction until the CASH IS KING and BUY GOLD crowd start coming out of the woodwork! I think we are here folks.

It will also be a noteworthy period when the "What are you up YTD?" and "FIRE" crowd starts to chatter with negativity in a big way (or go silent).
Let us not forget the 100/0 allocation folks.
that's me!
me too. Weeee, us 100/0 folk enjoy volatility, but so far this is far too tame.

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JoMoney
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Re: U.S. stocks in freefall

Post by JoMoney » Mon Apr 02, 2018 1:44 pm

F150HD wrote:
Mon Apr 02, 2018 1:41 pm
if this jagged staccato decline keeps continuing thru 2018 are they still going to be bumping up interest rates 2-3 more times?
When I look at Federal Reserve's objectives in conducting monetary policy I don't see anything about the "stock market" in there.
https://www.federalreserve.gov/faqs/money_12848.htm
"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 saltycaper » Mon Apr 02, 2018 1:47 pm

JoMoney wrote:
Mon Apr 02, 2018 1:44 pm
F150HD wrote:
Mon Apr 02, 2018 1:41 pm
if this jagged staccato decline keeps continuing thru 2018 are they still going to be bumping up interest rates 2-3 more times?
When I look at Federal Reserve's objectives in conducting monetary policy I don't see anything about the "stock market" in there.
https://www.federalreserve.gov/faqs/money_12848.htm
It is written in the course of history:

Greenspan put
Quod vitae sectabor iter?

bgf
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Re: U.S. stocks in freefall

Post by bgf » Mon Apr 02, 2018 1:48 pm

JoMoney wrote:
Mon Apr 02, 2018 1:37 pm
bgf wrote:
Mon Apr 02, 2018 1:31 pm
... i suppose i'm 200/-100 if you accept a mortgage as negative bond exposure.
It is if you look at your entire net worth in aggregate, and consider your home equity a self-landlord business where the 'imputed rent' for living in the home is pseudo tax-free earnings/income.
in which case, i have a noncallable 12 year loan at 2.875% invested in a diversified basket of global equities, which i find acceptable.
“TE OCCIDERE POSSUNT SED TE EDERE NON POSSUNT NEFAS EST"

RRAAYY3
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Re: U.S. stocks in freefall

Post by RRAAYY3 » Mon Apr 02, 2018 1:52 pm

Chuck wrote:
Mon Apr 02, 2018 1:16 pm
Not to get political, but the movements of the markets have echoed my own optimism as it relates to the political stability of the US. Specifically, the current presidential administration was seen as "pro-business" in the reduction of regulations, reduction of taxes, and suggestion of a lighter-touch regulatory regime. Then, tariffs and trade wars were brought out, and advocated as a "good thing," when anyone reasonably familiar with economics knows that additional taxes on anything are a drag on the economy, most of all, on steel and aluminum. (Gosh, steel and aluminum aren't in anything important, are they?) I think the long-term prospects of business in general are lower than they were before, and an adjustment in prices was appropriate.

This has done exactly nothing to my strategy, and I'm not buying or selling. "Regime uncertainty" is certainly not new to equity markets. I just disagree with folks who are saying that nothing has happened to cause the recent declines.
Thank you for not only addressing the issue that is on everyone’s mind, but doing so as nicely as possible

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cfs
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Re: U.S. stocks in freefall

Post by cfs » Mon Apr 02, 2018 1:55 pm

The tide is shifting.

Remember when a 100 point drop on the Dow was a big deal?

Good luck y gracias por leer / cfs
~ Member of the Active Retired Force since 2014 ~

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nisiprius
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Re: U.S. stocks in freefall

Post by nisiprius » Mon Apr 02, 2018 1:57 pm

missingdonut wrote:
Mon Apr 02, 2018 1:37 pm
...it's not that Joe Kennedy received stock tips from his shoeshine boy last week, after all!...
Image
No, but Planet Money did have a good episode recently, An Insider Trader Tells All. The image above shows a man named Bryan Shaw, handing a (former!) KPMG accountant named Scott London an envelope containing fifty $100 bills, in payment for stock tips Shaw had given him.
Last edited by nisiprius on Mon Apr 02, 2018 2:08 pm, edited 2 times in total.
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pollifax
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Re: U.S. stocks in freefall

Post by pollifax » Mon Apr 02, 2018 2:00 pm

RetireBy55 wrote:
Mon Apr 02, 2018 1:08 pm
WhiteMaxima wrote:
Mon Apr 02, 2018 1:03 pm
Hard cold cash is still the King.
Yep - and that's why I'm personally 50+% cash and always have been. I'll take the ~2.5% divvys and pay a good chunk of my bills with that..
What fund/savings account are you using that earns 2.5% dividends for cash right now?

robertmcd
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Re: U.S. stocks in freefall

Post by robertmcd » Mon Apr 02, 2018 2:16 pm

JoMoney wrote:
Mon Apr 02, 2018 1:44 pm
F150HD wrote:
Mon Apr 02, 2018 1:41 pm
if this jagged staccato decline keeps continuing thru 2018 are they still going to be bumping up interest rates 2-3 more times?
When I look at Federal Reserve's objectives in conducting monetary policy I don't see anything about the "stock market" in there.
https://www.federalreserve.gov/faqs/money_12848.htm
The only way the Fed can try and boost the economy is through the stock market by lowering the fed funds rate to prevent people from sitting on cash and to encourage debt and investment spending. After the tech bubble . when the 0% fed funds rate didn't pump up the "economy" enough, they turned to indiscriminately buying treasuries and MBS which obviously worked great for 8 yrs until 2008. When that failed, they doubled down on QE. When this experiment fails, they will go all in. Unfortunately all they have encouraged in 18 yrs is rabid speculation, leverage, and financial engineering that eventually suffocate the economy with debt. They will do this until the bond market takes away the keys, except the central banks have the master key and can buy every bond our government issues. So buy gold right?, but the illegalization of privately owning gold in 1933 tells you how the Fed feels about the free market taking away their printing presses.

Look at what percentage of the japanese stock market the Bank of Japan holds, some would refer to that as nationalizing the stock market, and they would be correct.

RetireBy55
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Re: U.S. stocks in freefall

Post by RetireBy55 » Mon Apr 02, 2018 2:40 pm

pollifax wrote:
Mon Apr 02, 2018 2:00 pm
RetireBy55 wrote:
Mon Apr 02, 2018 1:08 pm
WhiteMaxima wrote:
Mon Apr 02, 2018 1:03 pm
Hard cold cash is still the King.
Yep - and that's why I'm personally 50+% cash and always have been. I'll take the ~2.5% divvys and pay a good chunk of my bills with that..
What fund/savings account are you using that earns 2.5% dividends for cash right now?

Various Bank & CU CDs at 2 - 3% overall (like many here, I jumped on the Andrews 3%..).

I watch DepositAccounts and BankRate.com plus BH and other boards like a hawk, and jump on the highest rate bank or brokered CDs I can find..

2.5 is not that hard at the moment. 18 months ago it was damned near impossible.

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cfs
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Re: U.S. stocks in freefall

Post by cfs » Mon Apr 02, 2018 2:43 pm

Time to get back to talking about ** I N V E S T I N G **

Good luck y gracias por leer / cfs
~ Member of the Active Retired Force since 2014 ~

pollifax
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Re: U.S. stocks in freefall

Post by pollifax » Mon Apr 02, 2018 2:45 pm

Thank you.
RetireBy55 wrote:
Mon Apr 02, 2018 2:40 pm
pollifax wrote:
Mon Apr 02, 2018 2:00 pm
RetireBy55 wrote:
Mon Apr 02, 2018 1:08 pm
WhiteMaxima wrote:
Mon Apr 02, 2018 1:03 pm
Hard cold cash is still the King.
Yep - and that's why I'm personally 50+% cash and always have been. I'll take the ~2.5% divvys and pay a good chunk of my bills with that..
What fund/savings account are you using that earns 2.5% dividends for cash right now?

Various Bank & CU CDs at 2 - 3% overall (like many here, I jumped on the Andrews 3%..).

I watch DepositAccounts and BankRate.com plus BH and other boards like a hawk, and jump on the highest rate bank or brokered CDs I can find..

2.5 is not that hard at the moment. 18 months ago it was damned near impossible.

david1082b
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Re: U.S. stocks in freefall

Post by david1082b » Mon Apr 02, 2018 2:46 pm

saltycaper wrote:
Mon Apr 02, 2018 1:47 pm
JoMoney wrote:
Mon Apr 02, 2018 1:44 pm
F150HD wrote:
Mon Apr 02, 2018 1:41 pm
if this jagged staccato decline keeps continuing thru 2018 are they still going to be bumping up interest rates 2-3 more times?
When I look at Federal Reserve's objectives in conducting monetary policy I don't see anything about the "stock market" in there.
https://www.federalreserve.gov/faqs/money_12848.htm
It is written in the course of history:

Greenspan put
Y2K, really? Where is the evidence that the Fed injected funds due to "market declines" associated with "Y2K"? As for the Mexican crisis being mentioned, it's a pretty weak idea since the Fed actually raised rates throughout 1994 while stocks mostly went into a jagged decline and bonds got smashed, yet it carried on raising rates until April 1995, four months after the "Mexican crisis" started, seemingly not concerned at all about precious stock and bond prices https://fred.stlouisfed.org/series/FEDFUNDS https://en.wikipedia.org/wiki/Mexican_peso_crisis

The small cut after the '87 crash was very short-lived, since in 1988 the Fed raised its target rate up a lot into 1989, trying to slow real-estate down I guess. It had already started lowering rates in the middle of 1989 before the Gulf War stuff, lowering them until 1993 to fight the growing unemployment (unemployment that was not caused by the Gulf War probably).

That Wikipedia article seems to be rather studenty and written without much sourcing, just assuming stuff away, not once mentioning the Fed ever raising rates and not once mentioning unemployment as a possible reason for the Fed cutting rates, as it if was all about protecting precious asset prices.
Last edited by david1082b on Mon Apr 02, 2018 2:50 pm, edited 1 time in total.

rudeboy
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Re: U.S. stocks in freefall

Post by rudeboy » Mon Apr 02, 2018 2:50 pm

Put in a buy order today. If cash is king, then cheap shares are the greedy uncle hiding in the wings... :twisted:

BogleMelon
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Re: U.S. stocks in freefall

Post by BogleMelon » Mon Apr 02, 2018 2:56 pm

For all the folk who decided to buy today, haven't you guys read rule #5? :oops:
https://www.bogleheads.org/wiki/Boglehe ... the_market
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

rudeboy
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Re: U.S. stocks in freefall

Post by rudeboy » Mon Apr 02, 2018 3:01 pm

BogleMelon wrote:
Mon Apr 02, 2018 2:56 pm
For all the folk who decided to buy today, haven't you guys read rule #5? :oops:
https://www.bogleheads.org/wiki/Boglehe ... the_market
I have a fixed plan that I stick to regardless, then I throw in some extra fun money on down days like today.

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Re: U.S. stocks in freefall

Post by MJW » Mon Apr 02, 2018 3:02 pm

BogleMelon wrote:
Mon Apr 02, 2018 2:56 pm
For all the folk who decided to buy today, haven't you guys read rule #5? :oops:
https://www.bogleheads.org/wiki/Boglehe ... the_market
While this is normally true I believe you are overlooking one important fact:


Today is special. :wink:

bgf
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Re: U.S. stocks in freefall

Post by bgf » Mon Apr 02, 2018 3:03 pm

rudeboy wrote:
Mon Apr 02, 2018 3:01 pm
BogleMelon wrote:
Mon Apr 02, 2018 2:56 pm
For all the folk who decided to buy today, haven't you guys read rule #5? :oops:
https://www.bogleheads.org/wiki/Boglehe ... the_market
I have a fixed plan that I stick to regardless, then I throw in some extra fun money on down days like today.
on top of that, i don't think you can fault a buyer of stocks for market timing... i think that should be reserved for SELLERS of stocks.
“TE OCCIDERE POSSUNT SED TE EDERE NON POSSUNT NEFAS EST"

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cfs
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Re: U.S. stocks in freefall

Post by cfs » Mon Apr 02, 2018 3:08 pm

rudeboy wrote:
Mon Apr 02, 2018 2:50 pm
Put in a buy order today . . .
Good job.

I approve this message.

Good luck y gracias por leer / cfs
~ Member of the Active Retired Force since 2014 ~

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Re: U.S. stocks in freefall

Post by BogleMelon » Mon Apr 02, 2018 3:09 pm

bgf wrote:
Mon Apr 02, 2018 3:03 pm
rudeboy wrote:
Mon Apr 02, 2018 3:01 pm
BogleMelon wrote:
Mon Apr 02, 2018 2:56 pm
For all the folk who decided to buy today, haven't you guys read rule #5? :oops:
https://www.bogleheads.org/wiki/Boglehe ... the_market
I have a fixed plan that I stick to regardless, then I throw in some extra fun money on down days like today.
on top of that, i don't think you can fault a buyer of stocks for market timing... i think that should be reserved for SELLERS of stocks.
Well, if a buyer waited for a day like today to buy, while he had the funds setting in cash for - say - 6 months ago, then sure, he is in fault for loss of opportunity, had he invested these funds in October last year!
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

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Re: U.S. stocks in freefall

Post by saltycaper » Mon Apr 02, 2018 3:12 pm

david1082b wrote:
Mon Apr 02, 2018 2:46 pm
saltycaper wrote:
Mon Apr 02, 2018 1:47 pm
JoMoney wrote:
Mon Apr 02, 2018 1:44 pm
F150HD wrote:
Mon Apr 02, 2018 1:41 pm
if this jagged staccato decline keeps continuing thru 2018 are they still going to be bumping up interest rates 2-3 more times?
When I look at Federal Reserve's objectives in conducting monetary policy I don't see anything about the "stock market" in there.
https://www.federalreserve.gov/faqs/money_12848.htm
It is written in the course of history:

Greenspan put
Y2K, really? Where is the evidence that the Fed injected funds due to "market declines" associated with "Y2K"? As for the Mexican crisis being mentioned, it's a pretty weak idea since the Fed actually raised rates throughout 1994 while stocks mostly went into a jagged decline and bonds got smashed, yet it carried on raising rates until April 1995, four months after the "Mexican crisis" started https://fred.stlouisfed.org/series/FEDFUNDS https://en.wikipedia.org/wiki/Mexican_peso_crisis

The small cut after the '87 crash was very short-lived, since in 1988 the Fed raised its target rate up a lot into 1989, trying to slow real-estate down I guess. It had already started lowering rates in the middle of 1989 before the Gulf War stuff, lowering them until 1993 to fight the growing unemployment (unemployment that was not caused by the Gulf War probably).

That Wikipedia article seems to be rather studenty and written without much sourcing, just assuming stuff away, not once mentioning the Fed ever raising rates and not once mentioning unemployment as a possible reason for the Fed cutting rates, as it if was all about protecting precious asset prices.
I agree it's poorly sourced, but it communicates the general idea. If you don't like that article, the more general "Fed put" is such a widely recognized concept that there are literally thousands of other articles you can consult that discuss its extent.
Quod vitae sectabor iter?

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Re: U.S. stocks in freefall

Post by CokeSlurpee711 » Mon Apr 02, 2018 3:15 pm

$VTI limit order $130 ready to go. Everybody panic, this time is different.

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Re: U.S. stocks in freefall

Post by bgf » Mon Apr 02, 2018 3:15 pm

BogleMelon wrote:
Mon Apr 02, 2018 3:09 pm
bgf wrote:
Mon Apr 02, 2018 3:03 pm
rudeboy wrote:
Mon Apr 02, 2018 3:01 pm
BogleMelon wrote:
Mon Apr 02, 2018 2:56 pm
For all the folk who decided to buy today, haven't you guys read rule #5? :oops:
https://www.bogleheads.org/wiki/Boglehe ... the_market
I have a fixed plan that I stick to regardless, then I throw in some extra fun money on down days like today.
on top of that, i don't think you can fault a buyer of stocks for market timing... i think that should be reserved for SELLERS of stocks.
Well, if a buyer waited for a day like today to buy, while he had the funds setting in cash for - say - 6 months ago, then sure, he is in fault for loss of opportunity, had he invested these funds in October last year!
while that is technically true, i think its nitpicky. my point being that a BH is going to make many many many buy transactions over the course of investment horizon. picking and choosing a buy here and there is essentially meaningless, imo. its just noise.

the true mistake of market timing is when one is both buying and selling in and out of the market based on anticipation of future price action. for me, the sin is greatest when selling, not just making a buy here and there.
Last edited by bgf on Mon Apr 02, 2018 3:16 pm, edited 1 time in total.
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Re: U.S. stocks in freefall

Post by cfs » Mon Apr 02, 2018 3:16 pm

If Miss Market gives you an opportunity to buy, take it. No explanation nor excuses needed, it is your money, your portfolio, your decision. Good luck y gracias por leer / cfs

p.s. You just don't want to be out of this market for ONE day !!!
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Re: U.S. stocks in freefall

Post by Artful Dodger » Mon Apr 02, 2018 3:52 pm

I look at two variables when setting my AA. One, my comfort level - ie, how well can I sleep at night if there are downdrafts in the market. I remember in 08 - 09, how it felt to lose 45% of my mostly equity portfolio. I know on an intellectual level a 100% portfolio will perform well over 30 to 40 years, but I'm looking at retirement soon, so when I came over to the BH camp, I began somewhere in the 65/35 range, then lowered to 60/40. Now, due to variable #2, retirement in 2-4 years, I've been dropping my AA to low 50s equity. This gives me the peace of mind that my cash and bonds will cover me fully until full SS at age 70. If equities correct, I'll buy to rebalance to maintain at 50/50, with the caveat I'm keeping a minimum fixed investment portfolio to cover the gap to full SS. Any new 401k $ is still being invested either in U.S. or Int'l at 50%, balance in bonds or cash. I still make the assumption that over time, I'll need the equity portion to beat inflation, and i believe it will outpace most fixed investments over the long run, regardless of short term swings in the economy due to political changes.

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Re: U.S. stocks in freefall

Post by MotoTrojan » Mon Apr 02, 2018 4:33 pm

Smiling all day as I await my 5/1 arrival of private stock proceeds!

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Re: U.S. stocks in freefall

Post by mrspock » Mon Apr 02, 2018 4:36 pm

willthrill81 wrote:
Mon Apr 02, 2018 11:15 am
RetireBy55 wrote:
Mon Apr 02, 2018 11:11 am
Another day, another 500+ point, 2+% change on the Dow.

This is getting pretty old..

It's increasingly clear we're in the early days of a bear market. To top it off, we just breached the 200 DMA on the S&P. Since just about everybody from your neighborhood cab driver to your elderly grandma knows at this point to watch those indicators, the selling will only accelerate now..

Herd mentality is taking over. Fundamentals don't seem to matter for squat at the moment. It's just plain old fashioned panic, which causes more panic, until things get really cheap.

Sucks for those of us near ER. For those in your 20s, 30s or even 40s it's all in stride.
The early indicators of a recession do not indicate that we are currently in one, nor that one is on the horizon. Consequently, I'm just sitting tight right now. If those indicators change AND stocks are below their 7 month MA, I'll move into bonds.
Bear markets often coincide with recessions, but not always. This feels like the start of a bear to me as well....we will know for sure in a few months perhaps, until then I’m getting exceptionally good at TLH’ing.

I also wonder where Wall Street has the dead bodies buried this time.... consumer debt? Student debt? Auto debt? Too much borrowing to invest, and as interest rates rise the air comes out of the tires?

It just seems really unlikely this bull is going to run even a couple more years.

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Re: U.S. stocks in freefall

Post by willthrill81 » Mon Apr 02, 2018 4:39 pm

mrspock wrote:
Mon Apr 02, 2018 4:36 pm
willthrill81 wrote:
Mon Apr 02, 2018 11:15 am
RetireBy55 wrote:
Mon Apr 02, 2018 11:11 am
Another day, another 500+ point, 2+% change on the Dow.

This is getting pretty old..

It's increasingly clear we're in the early days of a bear market. To top it off, we just breached the 200 DMA on the S&P. Since just about everybody from your neighborhood cab driver to your elderly grandma knows at this point to watch those indicators, the selling will only accelerate now..

Herd mentality is taking over. Fundamentals don't seem to matter for squat at the moment. It's just plain old fashioned panic, which causes more panic, until things get really cheap.

Sucks for those of us near ER. For those in your 20s, 30s or even 40s it's all in stride.
The early indicators of a recession do not indicate that we are currently in one, nor that one is on the horizon. Consequently, I'm just sitting tight right now. If those indicators change AND stocks are below their 7 month MA, I'll move into bonds.
Bear markets often coincide with recessions, but not always. This feels like the start of a bear to me as well....we will know for sure in a few months perhaps, until then I’m getting exceptionally good at TLH’ing.

I also wonder where Wall Street has the dead bodies buried this time.... consumer debt? Student debt? Auto debt? Too much borrowing to invest, and as interest rates rise the air comes out of the tires?

It just seems really unlikely this bull is going to run even a couple more years.
We've been through deeper drawdowns since 2009, so it's hard to say whether this is a blip or a bear.
“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 triceratop » Mon Apr 02, 2018 4:42 pm

BogleMelon wrote:
Mon Apr 02, 2018 2:56 pm
For all the folk who decided to buy today, haven't you guys read rule #5? :oops:
https://www.bogleheads.org/wiki/Boglehe ... the_market
I'm confused; my quarterly dividends appeared in my brokerage account on Friday, but the market was closed. When should I be investing this new cash part of my portfolio back into bonds and equities?

Full disclosure: my limit order for VTI executed at $131.55 today. :D
"To play the stock market is to play musical chairs under the chord progression of a bid-ask spread."

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