U.S. stocks in free fall

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willthrill81
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Re: U.S. stocks in free fall

Post by willthrill81 »

minimalistmarc wrote: Mon Apr 13, 2020 10:17 am
willthrill81 wrote: Mon Apr 13, 2020 9:30 am
Forester wrote: Mon Apr 13, 2020 6:50 am Buying in now at the January '18 high at 20%+- unemployment, shouldn't be a good idea.
Stocks are always risky, but that sounds especially risky to me. Historically, significant rises in unemployment have coincided with poor stock returns and high volatility.
I think unemployment will rebound very quickly though
The UER will likely drop precipitously once lockdowns are eased, but I'm dubious as to whether we'll see it close to January's levels anytime soon.
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HomerJ
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Re: U.S. stocks in free fall

Post by HomerJ »

JonnyDVM wrote: Mon Apr 13, 2020 6:26 am
Seasonal wrote: Mon Apr 13, 2020 6:22 am
JonnyDVM wrote: Mon Apr 13, 2020 6:19 am Feeling like we are staring a down week in the face right now.
That could be. However, the market is so volatile I wouldn't bet a lot on where the market will be five hours from now, let alone five trading days.
I stand by my comment. But I’m just trying to get the thread back on track to its true purpose, which is posters making vague pessimistic predictions.
Heh, and a few making very specific apocalyptic predictions... :)
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CULater
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Re: U.S. stocks in free fall

Post by CULater »

No Virginia - we're not going anywhere anytime soon.
Today, things may be getting less bad, but they are hardly perfect. Let’s take off the rose-tinted glasses for a moment. Here is what we see:

the arrival of mass unemployment;
probable sovereign debt downgrades;
huge and unsustainable increases in public sector debt, including via unprecedented commitments to private sector debt obligations;
an unknown path of pandemic containment;
legitimate doubts about whether innovations that have driven a quarter-century boom in global corporate profitability—globalization, just-in-time inventories, and complex supply and finance chains—can be restored to what they were just several months ago.

So, why should it be that global equities are within 10-15% of their “the-world-is-priced-for-perfection” 2020 highs?
https://www.marketwatch.com/articles/ma ... =home-page

Just get ready for a long downward slide, punctuated by the occasional mad-hatter rally.
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nisiprius
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Re: U.S. stocks in free fall

Post by nisiprius »

Think positive. Sure, the Black Death was a nuisance, but you have to admit we got some pretty good cathedrals out of it.
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Re: U.S. stocks in free fall

Post by H-Town »

CULater wrote: Mon Apr 13, 2020 10:43 am No Virginia - we're not going anywhere anytime soon.
Today, things may be getting less bad, but they are hardly perfect. Let’s take off the rose-tinted glasses for a moment. Here is what we see:

the arrival of mass unemployment;
probable sovereign debt downgrades;
huge and unsustainable increases in public sector debt, including via unprecedented commitments to private sector debt obligations;
an unknown path of pandemic containment;
legitimate doubts about whether innovations that have driven a quarter-century boom in global corporate profitability—globalization, just-in-time inventories, and complex supply and finance chains—can be restored to what they were just several months ago.

So, why should it be that global equities are within 10-15% of their “the-world-is-priced-for-perfection” 2020 highs?
https://www.marketwatch.com/articles/ma ... =home-page

Just get ready for a long downward slide, punctuated by the occasional mad-hatter rally.
Best news of the day for accumulators, who will have plenty of time to keep buying in for cheap.

For market timers, every day is a roller coaster.
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Forester
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Re: U.S. stocks in free fall

Post by Forester »

CULater wrote: Mon Apr 13, 2020 10:43 am No Virginia - we're not going anywhere anytime soon.
Today, things may be getting less bad, but they are hardly perfect. Let’s take off the rose-tinted glasses for a moment. Here is what we see:

the arrival of mass unemployment;
probable sovereign debt downgrades;
huge and unsustainable increases in public sector debt, including via unprecedented commitments to private sector debt obligations;
an unknown path of pandemic containment;
legitimate doubts about whether innovations that have driven a quarter-century boom in global corporate profitability—globalization, just-in-time inventories, and complex supply and finance chains—can be restored to what they were just several months ago.

So, why should it be that global equities are within 10-15% of their “the-world-is-priced-for-perfection” 2020 highs?
https://www.marketwatch.com/articles/ma ... =home-page

Just get ready for a long downward slide, punctuated by the occasional mad-hatter rally.
Would be a Godsend! I'm not a bear as such, I just want sideways markets for a year or so.
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Re: U.S. stocks in free fall

Post by minimalistmarc »

CULater wrote: Mon Apr 13, 2020 10:43 am No Virginia - we're not going anywhere anytime soon.
Today, things may be getting less bad, but they are hardly perfect. Let’s take off the rose-tinted glasses for a moment. Here is what we see:

the arrival of mass unemployment;
probable sovereign debt downgrades;
huge and unsustainable increases in public sector debt, including via unprecedented commitments to private sector debt obligations;
an unknown path of pandemic containment;
legitimate doubts about whether innovations that have driven a quarter-century boom in global corporate profitability—globalization, just-in-time inventories, and complex supply and finance chains—can be restored to what they were just several months ago.

So, why should it be that global equities are within 10-15% of their “the-world-is-priced-for-perfection” 2020 highs?
https://www.marketwatch.com/articles/ma ... =home-page

Just get ready for a long downward slide, punctuated by the occasional mad-hatter rally.
Or climbing the mountain of worry, punctuated by the occasional doom monger correction?
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CULater
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Re: U.S. stocks in free fall

Post by CULater »

With people dying, it seems a bit petty to be pre-occupied with how the "market" is doing, doesn't it. I guess we're among the fortunate ones that haven't been directly affected yet and hopefully it will stay that way. As soon as we are, I don't think we'll give a damn how the "market" is doing.
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H-Town
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Re: U.S. stocks in free fall

Post by H-Town »

CULater wrote: Mon Apr 13, 2020 11:01 am With people dying, it seems a bit petty to be pre-occupied with how the "market" is doing, doesn't it. I guess we're among the fortunate ones that haven't been directly affected yet and hopefully it will stay that way. As soon as we are, I don't think we'll give a damn how the "market" is doing.
Not really. There are separate Covid-19 threads that you can share your empathy over there. Not in this thread. This is U.S. free fall thread.

I don't give a damn about day-to-day fluctuation, but I do care how the market is doing over 10-20 year time frame. There's a difference.
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nisiprius
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Re: U.S. stocks in free fall

Post by nisiprius »

Interesting choice of words for a headline:

Coronavirus Stock Market Rally
Coronavirus Stock Market Rally: Dow Jones Dives 600 Points, As Covid-19 Cases Continue To Rise; Amazon, Gilead Key Movers
If a 600 point "dive" is a "rally," I don't want to see a "dip."

Image
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Stinky
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Re: U.S. stocks in free fall

Post by Stinky »

nisiprius wrote: Mon Apr 13, 2020 11:34 am Interesting choice of words for a headline:

Coronavirus Stock Market Rally
Coronavirus Stock Market Rally: Dow Jones Dives 600 Points, As Covid-19 Cases Continue To Rise; Amazon, Gilead Key Movers
If a 600 point "dive" is a "rally," I don't want to see a "dip."

Image
Maybe a stock market dip is a "rally" if you're south of the equator.

They say that the toilets swirl in the opposite direction in the Southern Hemisphere. Maybe stock market "rallies" also work the opposite way down South.
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as9
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Re: U.S. stocks in free fall

Post by as9 »

I think they are referring to the status of the rally (i.e. last week), but it's horribly worded.
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Re: U.S. stocks in free fall

Post by Seasonal »

Rus In Urbe wrote: Mon Apr 13, 2020 9:42 am Let me clarify: Here's what I'm worried about....read these:

Financial Times:
Federal Reserve has encouraged moral hazard on a grand scale
https://www.ft.com/content/52a46bcf-f23 ... 8c3c1883e3

"The Fed Is Killing the Two Main Functions of Wall Street: Price Discovery and Prudent Capital Allocation"
https://wallstreetonparade.com/2020/04/ ... llocation/

Seasonal, don't get me wrong----I'm with you on bailouts of people and small businesses and keeping the economy going with interventions. It was a lesson we learned during the Great Recession when [can't say this because I might get dinged for a political comment] the recession was more protracted than it needed to be.

But what is actually happening right now (with our tax money) is that (according to articles linked above---and many others online, please read) the Fed is buying junk bonds. This is the "propping up" of which I wrote earlier.

So here is my question: when does that catch up with reality? When (and if) the tide goes out and the junk is seen to be naked, what happens then? (It's my opinion only that the tide is still going out, given the high unemployment figures and also Q2 statements around the corner).

Priced in, you say? If the government is buying junk bonds at every dip, this interferes quite seriously with price discovery and prudent capital allocation.

THAT is what I was getting at.

Rus.
The FT article is behind a paywall. The other article seems sensationalized.

The Fed is buying bonds that were investment grade until the coronavirus hit the market. In other words, companies that are, we hope, temporarily depressed due to the current economic disaster. This is not buying junk on every dip. This is keeping things going in a unique economic disaster that was caused by a healthcare crisis, not economic mismanagement by the companies or otherwise.

Is the Fed using tax money for this? I don't believe it really matters, but I thought the Fed was using newly created money, perhaps supplemented with borrowed money.

I don't believe it ever has to catch up. The danger of newly created money might be inflation, but that's not a problem today (deflation seems a larger risk) and can be dealt with if it ever becomes a problem. Government borrowing by a major country issuing debt in its own currency is mainly a danger if the interest rate exceeds the economy's growth rate, but if growth picks up we'll have the resources to pay down the debt if necessary. The main danger I see is the government worrying too much about debt, as they did in the Great Recession, leading to prolonged and unnecessary unemployment and pain.

This is all disaster relief. The alternatives are permanent damage to people and to the economy.
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Re: U.S. stocks in free fall

Post by Rus In Urbe »

Seasonal wrote:
The FT article is behind a paywall. The other article seems sensationalized.

The Fed is buying bonds that were investment grade until the coronavirus hit the market. In other words, companies that are, we hope, temporarily depressed due to the current economic disaster. This is not buying junk on every dip. This is keeping things going in a unique economic disaster that was caused by a healthcare crisis, not economic mismanagement by the companies or otherwise.

Is the Fed using tax money for this? I don't believe it really matters, but I thought the Fed was using newly created money, perhaps supplemented with borrowed money.

I don't believe it ever has to catch up. The danger of newly created money might be inflation, but that's not a problem today (deflation seems a larger risk) and can be dealt with if it ever becomes a problem. Government borrowing by a major country issuing debt in its own currency is mainly a danger if the interest rate exceeds the economy's growth rate, but if growth picks up we'll have the resources to pay down the debt if necessary. The main danger I see is the government worrying too much about debt, as they did in the Great Recession, leading to prolonged and unnecessary unemployment and pain.

This is all disaster relief. The alternatives are permanent damage to people and to the economy.
I suggest you simply google "Fed buying junk bonds"----there are many articles on this, not behind paywalls. This is a developing story, happened on Friday afternoon (of course). You might want to take a look.
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Re: U.S. stocks in free fall

Post by Seasonal »

Rus In Urbe wrote: Mon Apr 13, 2020 12:36 pm Seasonal wrote:
The FT article is behind a paywall. The other article seems sensationalized.

The Fed is buying bonds that were investment grade until the coronavirus hit the market. In other words, companies that are, we hope, temporarily depressed due to the current economic disaster. This is not buying junk on every dip. This is keeping things going in a unique economic disaster that was caused by a healthcare crisis, not economic mismanagement by the companies or otherwise.

Is the Fed using tax money for this? I don't believe it really matters, but I thought the Fed was using newly created money, perhaps supplemented with borrowed money.

I don't believe it ever has to catch up. The danger of newly created money might be inflation, but that's not a problem today (deflation seems a larger risk) and can be dealt with if it ever becomes a problem. Government borrowing by a major country issuing debt in its own currency is mainly a danger if the interest rate exceeds the economy's growth rate, but if growth picks up we'll have the resources to pay down the debt if necessary. The main danger I see is the government worrying too much about debt, as they did in the Great Recession, leading to prolonged and unnecessary unemployment and pain.

This is all disaster relief. The alternatives are permanent damage to people and to the economy.
I suggest you simply google "Fed buying junk bonds"----there are many articles on this, not behind paywalls. This is a developing story, happened on Friday afternoon (of course). You might want to take a look.
What makes you think I'm not familiar with what the Fed is doing?

See https://www.federalreserve.gov/newseven ... 0409a2.pdf for the actual terms of the relevant facility, rather than some writer's take, and https://www.federalreserve.gov/newseven ... 00409a.htm for announcement of this and other facilities. The announcement was 8:30am on April 9, which was a Thursday.
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Re: U.S. stocks in free fall

Post by watchnerd »

Seasonal wrote: Mon Apr 13, 2020 12:43 pm
What makes you think I'm not familiar with what the Fed is doing?

See https://www.federalreserve.gov/newseven ... 0409a2.pdf for the actual terms of the relevant facility, rather than some writer's take, and https://www.federalreserve.gov/newseven ... 00409a.htm for announcement of this and other facilities. The announcement was 8:30am on April 9, which was a Thursday.
Well, the DPA is pretty "anti free market", too.

But is the alternative to buying junk bonds, i.e. increasing financing costs for highly leveraged firms at risk, better in this environment?

Moral hazard vs more unemployment -- neither a good outcome, but the Fed's mandate includes addressing unemployment.
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awval999
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Re: U.S. stocks in free fall

Post by awval999 »

awval999 wrote: Thu Mar 12, 2020 5:45 am Does anyone "rebalance" the way I do?
Default 80/20.
Then at every 10% down I go 5% more into stocks.

At -10% I'm at 85/15
At -20% I'm at 90/10
At -30% I'm at 95/5
At -40% I'm at 100/0

I then ride the wave back up to the all time high, when I go back to 80/20.
It's written in my IPS.

This morning I executed the second tranche.

It's easy to do at 34. Don't know if I'd want to do this at 54. Although I'd have plenty more bonds at 54.
I executed the 3rd tranche on Friday March 20th. At that time I was 95/5.

Yesterday I capitulated and sold all quarter-million dollars of our life savings - my 403b - into VMFXX (Vanguard Money Market fund). I hit click at 3:55pm at work.

Watching the stock market go up was harder then watching it go down.

I know I have sinned. But the things I fear that come from this cannot be posted on Bogleheads.

I was able to come home, kiss my wife and my child, and be able to sleep soundly.
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Re: U.S. stocks in free fall

Post by RayKeynes »

awval999 wrote: Wed Apr 15, 2020 5:31 am
awval999 wrote: Thu Mar 12, 2020 5:45 am Does anyone "rebalance" the way I do?
Default 80/20.
Then at every 10% down I go 5% more into stocks.

At -10% I'm at 85/15
At -20% I'm at 90/10
At -30% I'm at 95/5
At -40% I'm at 100/0

I then ride the wave back up to the all time high, when I go back to 80/20.
It's written in my IPS.

This morning I executed the second tranche.

It's easy to do at 34. Don't know if I'd want to do this at 54. Although I'd have plenty more bonds at 54.
I know I have sinned. But the things I fear that come from this cannot be posted on Bogleheads.
Very wise decision. I like that comment. :sharebeer
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Re: U.S. stocks in free fall

Post by Noobvestor »

awval999 wrote: Wed Apr 15, 2020 5:31 am
awval999 wrote: Thu Mar 12, 2020 5:45 am Does anyone "rebalance" the way I do?
Default 80/20.
Then at every 10% down I go 5% more into stocks.

At -10% I'm at 85/15
At -20% I'm at 90/10
At -30% I'm at 95/5
At -40% I'm at 100/0

I then ride the wave back up to the all time high, when I go back to 80/20.
It's written in my IPS.

This morning I executed the second tranche.

It's easy to do at 34. Don't know if I'd want to do this at 54. Although I'd have plenty more bonds at 54.
I executed the 3rd tranche on Friday March 20th. At that time I was 95/5.

Yesterday I capitulated and sold all quarter-million dollars of our life savings - my 403b - into VMFXX (Vanguard Money Market fund). I hit click at 3:55pm at work.

Watching the stock market go up was harder then watching it go down.

I know I have sinned. But the things I fear that come from this cannot be posted on Bogleheads.

I was able to come home, kiss my wife and my child, and be able to sleep soundly.
I really can't even imagine this scenario. I go back and forth, thinking about optimal allocations in times of market stress, but I don't think I could sleep at all if I were at the outer limits on either side, by which I mean: more than 75% stocks or less than 25% stocks. Sitting entirely in cash right now would make sleep very difficult for me. Sitting entirely in stocks would be similarly challenging. I find it remarkable time and time again how some people feel more comfortable at extremes than they do with a balance that hedges a variety of outcomes, but to each their own, I suppose.
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Re: U.S. stocks in free fall

Post by Independent George »

awval999 wrote: Wed Apr 15, 2020 5:31 am
awval999 wrote: Thu Mar 12, 2020 5:45 am Does anyone "rebalance" the way I do?
Default 80/20.
Then at every 10% down I go 5% more into stocks.

At -10% I'm at 85/15
At -20% I'm at 90/10
At -30% I'm at 95/5
At -40% I'm at 100/0

I then ride the wave back up to the all time high, when I go back to 80/20.
It's written in my IPS.

This morning I executed the second tranche.

It's easy to do at 34. Don't know if I'd want to do this at 54. Although I'd have plenty more bonds at 54.
I executed the 3rd tranche on Friday March 20th. At that time I was 95/5.

Yesterday I capitulated and sold all quarter-million dollars of our life savings - my 403b - into VMFXX (Vanguard Money Market fund). I hit click at 3:55pm at work.

Watching the stock market go up was harder then watching it go down.

I know I have sinned. But the things I fear that come from this cannot be posted on Bogleheads.

I was able to come home, kiss my wife and my child, and be able to sleep soundly.
I hate talking about 'sin' as if this were a religious experience. In pure rational terms, what are you so afraid of that you liquidated 100% of your portfolio into cash? And if you are that fearful, why did you engage in the rebalancing strategy that you did in the first place?

You have a 403b, which means a secure public sector job. You are 34, which means you won't be able to access the account for at least another 25 years anyway. You saved 250k in about ten years, which means you've been living below your means your entire adult life. As a Boglehead, I assume you and your wife both have life insurance.

What specific fear would make you go 100% cash in a retirement account you can't access at age 34?

My biggest fear right now is losing loved ones to the disease, followed by fear of losing my job & income, and then fear of getting the disease myself (I am 43 and in excellent health, and not in the primary risk groups). None of those fears are mitigated in the slightest by changing my AA. If I were afraid enough, I would reduce my retirement contributions to increase cash flow and move my taxable investments into cash.
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Re: U.S. stocks in free fall

Post by Pikel »

awval999 wrote: Wed Apr 15, 2020 5:31 am
the things I fear that come from this cannot be posted on Bogleheads.
This risk always exists. You have a brief window to re-evaluate your risk tolerance and re-invest in your future. Your old strategy was too greedy.

You have to invest when terrified.
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Re: U.S. stocks in free fall

Post by H-Town »

awval999 wrote: Wed Apr 15, 2020 5:31 am
awval999 wrote: Thu Mar 12, 2020 5:45 am Does anyone "rebalance" the way I do?
Default 80/20.
Then at every 10% down I go 5% more into stocks.

At -10% I'm at 85/15
At -20% I'm at 90/10
At -30% I'm at 95/5
At -40% I'm at 100/0

I then ride the wave back up to the all time high, when I go back to 80/20.
It's written in my IPS.

This morning I executed the second tranche.

It's easy to do at 34. Don't know if I'd want to do this at 54. Although I'd have plenty more bonds at 54.
I executed the 3rd tranche on Friday March 20th. At that time I was 95/5.

Yesterday I capitulated and sold all quarter-million dollars of our life savings - my 403b - into VMFXX (Vanguard Money Market fund). I hit click at 3:55pm at work.

Watching the stock market go up was harder then watching it go down.

I know I have sinned. But the things I fear that come from this cannot be posted on Bogleheads.

I was able to come home, kiss my wife and my child, and be able to sleep soundly.
I guess it's time to draft up a new IPS? Maybe the new one would have only one line:
"Invest in one fund: 20xx Target Date Retirement Fund with new contribution at every paycheck. I cannot sell until I retire and start withdrawal to pay living expenses."
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Forester
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Re: U.S. stocks in free fall

Post by Forester »

Waning momentum... a lot of greedy market timers who "brought forward contributions" will have bought high.
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Stef
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Re: U.S. stocks in free fall

Post by Stef »

Rather quiet today. Everybody watching oil prices right now lol?
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Re: U.S. stocks in free fall

Post by Briscoe »

awval999 wrote: Wed Apr 15, 2020 5:31 am
awval999 wrote: Thu Mar 12, 2020 5:45 am Does anyone "rebalance" the way I do?
Default 80/20.
Then at every 10% down I go 5% more into stocks.

At -10% I'm at 85/15
At -20% I'm at 90/10
At -30% I'm at 95/5
At -40% I'm at 100/0

I then ride the wave back up to the all time high, when I go back to 80/20.
It's written in my IPS.

This morning I executed the second tranche.

It's easy to do at 34. Don't know if I'd want to do this at 54. Although I'd have plenty more bonds at 54.
I executed the 3rd tranche on Friday March 20th. At that time I was 95/5.

Yesterday I capitulated and sold all quarter-million dollars of our life savings - my 403b - into VMFXX (Vanguard Money Market fund). I hit click at 3:55pm at work.

Watching the stock market go up was harder then watching it go down.

I know I have sinned. But the things I fear that come from this cannot be posted on Bogleheads.

I was able to come home, kiss my wife and my child, and be able to sleep soundly.
I do something similar but a bit more conservative (I am 49):

At -10% Do nothing
At -20% Rebalance maintaining 60/40.
At -30% Rebalance to 70/30
At -40% Rebalance to 80/20
At -50% Rebalance to 90/10
At -60% Rebalance to 100/0

I use VT as my benchmark and I have already rebalance to -30% level above. I won't go back to 60/40 until we have fully recovered and are back to making new all-time highs.
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Re: U.S. stocks in free fall

Post by watchnerd »

Stef wrote: Mon Apr 20, 2020 1:53 pm Rather quiet today. Everybody watching oil prices right now lol?
I'm not.

Did something interesting happen?
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Re: U.S. stocks in free fall

Post by csmath »

watchnerd wrote: Mon Apr 20, 2020 2:30 pm
Stef wrote: Mon Apr 20, 2020 1:53 pm Rather quiet today. Everybody watching oil prices right now lol?
I'm not.

Did something interesting happen?
You can get paid to take oil. That is interesting right? GL w/ the storage problem though!
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Re: U.S. stocks in free fall

Post by Stinky »

csmath wrote: Mon Apr 20, 2020 2:32 pm
watchnerd wrote: Mon Apr 20, 2020 2:30 pm
Stef wrote: Mon Apr 20, 2020 1:53 pm Rather quiet today. Everybody watching oil prices right now lol?
I'm not.

Did something interesting happen?
You can get paid to take oil. That is interesting right? GL w/ the storage problem though!
That’s the craziest thing I’ve ever seen.
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Re: U.S. stocks in free fall

Post by theorist »

You have to wonder whether OPEC + Russia could have seen this coming, or whether their plans have gone really horribly wrong. It is hard to see how this benefits them (though maybe in the long term if it utterly destroys US shale?).
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watchnerd
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Re: U.S. stocks in free fall

Post by watchnerd »

csmath wrote: Mon Apr 20, 2020 2:32 pm
watchnerd wrote: Mon Apr 20, 2020 2:30 pm
Stef wrote: Mon Apr 20, 2020 1:53 pm Rather quiet today. Everybody watching oil prices right now lol?
I'm not.

Did something interesting happen?
You can get paid to take oil. That is interesting right? GL w/ the storage problem though!
Only for WTI.

So if you've got a spare swimming pool in Oklahoma, back up the truck, I guess.
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AnalogKid22
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Re: U.S. stocks in free fall

Post by AnalogKid22 »

Pandemic, unemployment, oil. Next?
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CULater
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Re: U.S. stocks in free fall

Post by CULater »

‘We’re only down 15% from the all-time high of Feb. 19... it seems to me the world is more than 15% screwed up.’
~ Howard Marks - Oaktree Capital

:confused Deflation Anybody?
On the internet, nobody knows you're a dog.
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Doom&Gloom
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Re: U.S. stocks in free fall

Post by Doom&Gloom »

And I thought negative interest rates were hard to comprehend. Perhaps they can put the oil back in the ground where they found it???
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Re: U.S. stocks in free fall

Post by drk »

CULater wrote: Mon Apr 20, 2020 3:24 pm ‘We’re only down 15% from the all-time high of Feb. 19... it seems to me the world is more than 15% screwed up.’
~ Howard Marks - Oaktree Capital

:confused Deflation Anybody?
Howard Marks is talking his book. He just raised $15 billion for a distressed debt fund, and now the federal government's response has reduced his opportunities.
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Re: U.S. stocks in free fall

Post by H-Town »

Doom&Gloom wrote: Mon Apr 20, 2020 3:32 pm And I thought negative interest rates were hard to comprehend. Perhaps they can put the oil back in the ground where they found it???
It wouldn't be hard since gravity would do all the work :mrgreen:

Oil producers keep doing their thing. Not their first rodeo.

Some oil traders, on the other hand, will crash and burn. They got caught holding the bag at the expiration date of May future contract. Oh well, there will be new oil traders next in line..
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Re: U.S. stocks in free fall

Post by madbrain »

H-Town wrote: Mon Apr 20, 2020 3:41 pm It wouldn't be hard since gravity would do all the work :mrgreen:
You are forgetting about all the marine sources.
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Re: U.S. stocks in free fall

Post by Mactheriverrat »

AnalogKid22 wrote: Mon Apr 20, 2020 3:17 pm Pandemic, unemployment, oil. Next?
Earth blows up! Film at 11:00.
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Re: U.S. stocks in free fall

Post by whodidntante »

Stef wrote: Mon Apr 20, 2020 1:53 pm Rather quiet today. Everybody watching oil prices right now lol?
We'll be talking about COVID-19 impacts and the oil crash for as long as we live. I mean, what happened to make -37 possible, and so quickly? The price chart looks like the first big hill of a roller coaster. What's next, a loop? :happy
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Re: U.S. stocks in free fall

Post by whodidntante »

CULater wrote: Mon Apr 20, 2020 3:24 pm ‘We’re only down 15% from the all-time high of Feb. 19... it seems to me the world is more than 15% screwed up.’
~ Howard Marks - Oaktree Capital

:confused Deflation Anybody?
Yeah, I saw the interview and I laughed out loud at that comment.

For what it's worth, I'm putting my bear hat back on. My taste in sports teams means I have the gear at the ready. :happy
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Re: U.S. stocks in free fall

Post by willthrill81 »

whodidntante wrote: Mon Apr 20, 2020 10:33 pm
CULater wrote: Mon Apr 20, 2020 3:24 pm ‘We’re only down 15% from the all-time high of Feb. 19... it seems to me the world is more than 15% screwed up.’
~ Howard Marks - Oaktree Capital

:confused Deflation Anybody?
Yeah, I saw the interview and I laughed out loud at that comment.
I trust this rebound as much as a politician's promises.
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Re: U.S. stocks in free fall

Post by tk1978 »

My crystal ball may be cloudy but that won’t stop me from predicting that this thread will become very active again in the coming weeks. I think the economic devastation caused by the virus will only become more pronounced as we go along, and there’s no easy way out.
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Re: U.S. stocks in free fall

Post by F150HD »

Branson, who has an estimated net worth of $5.86 billion...said he doesn’t have the necessary cash on hand to bail out his airlines himself

https://www.marketwatch.com/story/richa ... 2020-04-20

:confused
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Re: U.S. stocks in free fall

Post by vipertom1970 »

my last big purchase was 3/23/20 when the DOW was at 18,576 but got some ammo left so I am ready.
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Re: U.S. stocks in free fall

Post by steve roy »

nisiprius wrote: Mon Apr 13, 2020 10:45 am Think positive. Sure, the Black Death was a nuisance, but you have to admit we got some pretty good cathedrals out of it.
... and ultimately, the Renaissance! So everything turned out okay.
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Re: U.S. stocks in free fall

Post by morsk »

AnalogKid22 wrote: Mon Apr 20, 2020 3:17 pm Pandemic, unemployment, oil. Next?
Hopefully, equities. These valuations are pants-on-head.
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Re: U.S. stocks in free fall

Post by dukeblue219 »

whodidntante wrote: Mon Apr 20, 2020 10:30 pm
Stef wrote: Mon Apr 20, 2020 1:53 pm Rather quiet today. Everybody watching oil prices right now lol?
We'll be talking about COVID-19 impacts and the oil crash for as long as we live. I mean, what happened to make -37 possible, and so quickly? The price chart looks like the first big hill of a roller coaster. What's next, a loop? :happy
Is there any information on the volume traded? That was my suspicion, that it was simply no volume. Nobody wanted to or could buy at any price and yet a few speculating sellers had to close out, and would have sold even if oil had fallen to several hundred negative dollars. But maybe I'm way off.

Looks like JUNE WTI plunged this morning as low as $11 before recovering. Now down just 20%.
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Re: U.S. stocks in free fall

Post by morsk »

dukeblue219 wrote: Tue Apr 21, 2020 6:56 am
whodidntante wrote: Mon Apr 20, 2020 10:30 pm
Stef wrote: Mon Apr 20, 2020 1:53 pm Rather quiet today. Everybody watching oil prices right now lol?
We'll be talking about COVID-19 impacts and the oil crash for as long as we live. I mean, what happened to make -37 possible, and so quickly? The price chart looks like the first big hill of a roller coaster. What's next, a loop? :happy
Is there any information on the volume traded? That was my suspicion, that it was simply no volume. Nobody wanted to or could buy at any price and yet a few speculating sellers had to close out, and would have sold even if oil had fallen to several hundred negative dollars. But maybe I'm way off.

Looks like JUNE WTI plunged this morning as low as $11 before recovering. Now down just 20%.
You can find the charts on CME Group. It was just a moderate trading day in terms of volume (for 2020)

But yes, that was the essentially case. Oil is the most actively traded commodity and there are 20x (or more, I remember one of my profs giving us an estimate in my energy markets class) more speculative traders than actual physical traders. These specs simply cannot take delivery and didn't want to end up holding the bag, so they had to beg (pay) anyone who could take delivery of the crude they're holding. The problem is storage is hard to come by these days, including for the physical guys so they'll only accept crude if you pay them a pretty premium.

Check out Plains All-American's price bulletin posted yesterday.
Last edited by morsk on Tue Apr 21, 2020 7:36 am, edited 1 time in total.
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CULater
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Re: U.S. stocks in free fall

Post by CULater »

Looks like it could be another bad day in the market...

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Re: U.S. stocks in free fall

Post by morsk »

New non-manufacturing data from Philly FED

April v. March
* New Orders: -67.2 v -16.4
* Revenues: -87.9 v -4.9
* FT Employees: -47.5 v -1.7
* PT Employees: -58.9 v -11.2
* Average Employee Workweek: -50.7 v -5.2
* CAPEX - Physical Plants: -41.3 v 10.6
* CAPEX - Software/Equipment: -40.5 v 22.6

But yeah, no biggie...SPX just 16% off from ATH, let's keep buying!
minimalistmarc
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Re: U.S. stocks in free fall

Post by minimalistmarc »

morsk wrote: Tue Apr 21, 2020 7:45 am New non-manufacturing data from Philly FED

April v. March
* New Orders: -67.2 v -16.4
* Revenues: -87.9 v -4.9
* FT Employees: -47.5 v -1.7
* PT Employees: -58.9 v -11.2
* Average Employee Workweek: -50.7 v -5.2
* CAPEX - Physical Plants: -41.3 v 10.6
* CAPEX - Software/Equipment: -40.5 v 22.6

But yeah, no biggie...SPX just 16% off from ATH, let's keep buying!
“Let’s keep buying” - yep. What else is there to do. I just bought 20k of vanguard all world with new money today.
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