U.S. stocks in freefall

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JoMoney
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Re: ???

Post by JoMoney » Fri Apr 06, 2018 3:09 pm

lostdog wrote:
Fri Apr 06, 2018 3:07 pm
bi0hazard wrote:
Fri Apr 06, 2018 2:58 pm
oldnewinvestor wrote:
Fri Apr 06, 2018 2:52 pm
Anyone buying today? :D
yes
yep, the 401k deposited today.
yup.... but not much, my bigger buy will come at the end of next week (so I feel confident in predicting it will be higher then).
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Re: ???

Post by lazydavid » Fri Apr 06, 2018 3:22 pm

oldnewinvestor wrote:
Fri Apr 06, 2018 2:52 pm
Anyone buying today? :D
Yep. I've been travelling for the past two weeks, so haven't paid attention to my AA shifting as we've bounced around. the 3% downturn as of mid-afternoon had me do some math, which in turn directed me to exchange $20k of bonds for (mostly, but not entirely US) equity.

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Re: U.S. stocks in freefall

Post by WorkToLive » Fri Apr 06, 2018 3:29 pm

I had been sitting on about $24k of cash and just dumped it in today. I am committed to not looking again at the market for at least 6 months. I want to get out of the habit of looking at it period.

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Re: U.S. stocks in freefall

Post by rudeboy » Fri Apr 06, 2018 3:32 pm

WorkToLive wrote:
Fri Apr 06, 2018 3:29 pm
I had been sitting on about $24k of cash and just dumped it in today. I am committed to not looking again at the market for at least 6 months. I want to get out of the habit of looking at it period.
Jack Bogle would approve. Good move.

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Re: U.S. stocks in freefall

Post by oldcomputerguy » Fri Apr 06, 2018 3:35 pm

Funny, I didn't even know what the market had been doing until I came here and saw this thread at the top of the list again. I've been out in the back yard, doing some modification on a small deck. Given the drop in the market, I guess I was doing something more fun. :D
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Re: U.S. stocks in freefall

Post by Doom&Gloom » Fri Apr 06, 2018 4:31 pm

In days of yore it was Fridays like this that I loved watching Louis Rukeyser on WSW. I'm sure it wouldn't be the same with a post-Bogle mindset though.

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Re: ???

Post by dougger5 » Fri Apr 06, 2018 7:55 pm

oldnewinvestor wrote:
Fri Apr 06, 2018 2:52 pm
Anyone buying today? :D
Nope - thought about it though. But I figured I'd just stick with the plan. Which has a Roth contribution scheduled for Monday, so I'll certainly be interested to see where this goes then.

This recent volatility has reinforced my decision to rebalance once a year. Wouldn't want to be fretting over bands in an environment like this.
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Re: U.S. stocks in freefall

Post by NYCwriter » Fri Apr 06, 2018 8:52 pm

I added a small bit to index funds in taxable and Roth, my usual monthly adds. My last retirement deposit was on 3/29 so I probably wasn't as lucky. But that's the Welly fund, and since I rarely check it I'm always pleasantly surprised to see I'm ahead of where I expected to be, year over year.

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Re: U.S. stocks in freefall

Post by Veiled » Sat Apr 07, 2018 7:12 am

My first investing emotion since my initiation into passive index fund investing: I'm rather bummed that I can't take advantage of the relative sale right now. I'm not slated to invest more until the fourth quarter (an unfortunately inflexible plan made before these market vacillations). Oh well.
Pardon me as I read these one hundred and fifty-seven SP vs LLC vs Scorp threads...

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Re: U.S. stocks in freefall

Post by fortyofforty » Sat Apr 07, 2018 7:32 am

Veiled wrote:
Sat Apr 07, 2018 7:12 am
My first investing emotion since my initiation into passive index fund investing: I'm rather bummed that I can't take advantage of the relative sale right now. I'm not slated to invest more until the fourth quarter (an unfortunately inflexible plan made before these market vacillations). Oh well.
I know the feeling. Sometimes, when starting out, I'd invest and then be bummed when the market dropped soon after. It was a lot harder to know exactly when your investment would be processed, because it was done via a check in the mail sent off with a stamp, but the emotion was the same. I wasn't upset that I had lost money, but that I could have bought more if I had bought later.

From the perspective of time, don't worry about such fluctuations. You'll never catch the absolute bottom for a purchase, or the pinnacle for a sale. Just stick with your plan and stay the course.

Bon chance! :beer
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Re: U.S. stocks in freefall

Post by fortyofforty » Sat Apr 07, 2018 7:36 am

Does the Total Bond Market provide a real cushion during market swings? If the purpose of bonds in a portfolio is to provide stability, is a fund containing long-term bonds the best for such a function? Would a short- or mid-term bond fund do a better job at this? Didn't bonds usually move inversely to stocks, generally (excluding "junk" bonds, of course)?
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Re: U.S. stocks in freefall

Post by ReformedSpender » Sat Apr 07, 2018 9:31 am

Monday could provide another 'discount'

SPX was down more than -2% after another -2% day within the past 5 trading days. Though sample size is small (n=22), data on the following trading day since 1950 shows 10 of the last 14 have been negative.

Image
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JoMoney
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Re: U.S. stocks in freefall

Post by JoMoney » Sat Apr 07, 2018 9:37 am

My guess is that it won't go much lower next week, primarily because my regular paycheck contribution will be going on and it feels like I'm always hitting the up-trends rather than the down.
Also, there seems to be support on the S&P just above the $2,580 level, it's bounced off that area on down-turns a couple times this year.
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Re: U.S. stocks in freefall

Post by nedsaid » Sat Apr 07, 2018 9:54 am

JoMoney wrote:
Sat Apr 07, 2018 9:37 am
My guess is that it won't go much lower next week, primarily because my regular paycheck contribution will be going on and it feels like I'm always hitting the up-trends rather than the down.
Also, there seems to be support on the S&P just above the $2,580 level, it's bounced off that area on down-turns a couple times this year.
Wow. A Benjamin Graham disciple is taking a stab at technical analysis. :wink:

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Re: U.S. stocks in freefall

Post by livesoft » Sat Apr 07, 2018 10:08 am

ReformedSpender wrote:
Sat Apr 07, 2018 9:31 am
Monday could provide another 'discount'

SPX was down more than -2% after another -2% day within the past 5 trading days.
[...]
VTI (Vanguard Total Stock Market Index ETF was UP 4.5% last week from the Monday low to the Thursday high. :)
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Re: U.S. stocks in freefall

Post by ReformedSpender » Sat Apr 07, 2018 10:14 am

livesoft wrote:
Sat Apr 07, 2018 10:08 am
ReformedSpender wrote:
Sat Apr 07, 2018 9:31 am
Monday could provide another 'discount'

SPX was down more than -2% after another -2% day within the past 5 trading days.
[...]
VTI (Vanguard Total Stock Market Index ETF was UP 4.5% last week from the Monday low to the Thursday high. :)
Not following how selectively choosing the intra-day low and highs correlates to the intent of the original post. VTI as a whole was down 1.36% last week.

https://finviz.com/quote.ashx?t=vti

:beer
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Re: U.S. stocks in freefall

Post by pleeson » Sat Apr 07, 2018 10:34 am

fortyofforty wrote:
Sat Apr 07, 2018 7:36 am
Does the Total Bond Market provide a real cushion during market swings? If the purpose of bonds in a portfolio is to provide stability, is a fund containing long-term bonds the best for such a function? Would a short- or mid-term bond fund do a better job at this? Didn't bonds usually move inversely to stocks, generally (excluding "junk" bonds, of course)?
I would avoid any mid/long bond funds, rather buy individual bonds and hold to maturity.
Bond funds are tricky right now - read up on the burgeoning deficit, consumer debt, quantitative tightening.
Not a time to be holding long term bond funds, IMO.

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Re: U.S. stocks in freefall

Post by ruralavalon » Sat Apr 07, 2018 10:48 am

pleeson wrote:
Sat Apr 07, 2018 10:34 am
fortyofforty wrote:
Sat Apr 07, 2018 7:36 am
Does the Total Bond Market provide a real cushion during market swings? If the purpose of bonds in a portfolio is to provide stability, is a fund containing long-term bonds the best for such a function? Would a short- or mid-term bond fund do a better job -grade bonds this? Didn't bonds usually move inversely to stocks, generally (excluding "junk" bonds, of course)?
I would avoid any mid/long bond funds, rather buy individual bonds and hold to maturity.
Bond funds are tricky right now - read up on the burgeoning deficit, consumer debt, quantitative tightening.
Not a time to be holding long term bond funds, IMO.
Bonds don't generally move "inversely" (the opposite direction) to stocks. Bond movements generally have a low correlation to movements in stocks. Junk bond movements are more highly correlated to stock movements than are the movements of investment-grade bonds.
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Re: U.S. stocks in freefall

Post by LadyGeek » Sat Apr 07, 2018 11:27 am

To say "bonds have a low correlation to stocks" another way: Bonds don't care what stocks do, they move for their own reasons.

This is very different than the inverse relationship between a bond's price and it's yield. See the wiki: Bond pricing
wiki wrote:Since I is in the denominator of the bond price equation, increasing I will decrease the price (the other variables are fixed). Therefore, a bond's price will always theoretically move in the opposite direction to its yield.
^^^ The market also has an influence on bond prices, but this is the underlying principle.

The math follows the basic Time Value of Money equation.

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Re: U.S. stocks in freefall

Post by longinvest » Sat Apr 07, 2018 11:36 am

LadyGeek wrote:
Sat Apr 07, 2018 11:27 am
To say "bonds have a low correlation to stocks" another way: Bonds don't care what stocks do, they move for their own reasons.

This is very different than the inverse relationship between a bond's price and it's yield. See the wiki: Bond pricing
Something much more more important to consider than correlations is magnitude:

et tu, Vanguard? Stock/Bond zig-zag myth
nisiprius wrote:
Sat Aug 06, 2016 4:14 pm
[...]

We always have to look at magnitude, not just direction.

Starting from 12/31/2007, during 2008-2009, stocks (VTSMX, blue) fell 52% (3/6/2009). To be as fair as possible I'll take the local peak for Total Bond, green, $10,615 on 1/16/2009.

Source
Image

So, yes. Stocks went down. Bonds went up. Opposite directions. But what about magnitude?

Stocks went down 52%.
"Bonds" as represented by Total Bond went up 6.2%.
Stocks made a 52% ZZZZZZIGGG!
Bonds made a 6.2% zag.

[...]
Last edited by longinvest on Thu Apr 12, 2018 6:41 am, edited 1 time in total.
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Re: U.S. stocks in freefall

Post by fortyofforty » Sat Apr 07, 2018 2:15 pm

Thanks for the replies, LG, longivest, nisiprius, ruralavalon and freeson!

My thought was that, as money flowed out of stocks, it might flow into bonds, thereby lowering yields and causing the prices of existing bonds to rise.

I do realize that the magnitude of price movements in investment grade bonds is generally far less than that of stocks. Besides low correlation, that provides some stability. For that purpose, isn't there an argument to be made to avoid long-term bonds?

Also, as far as the mix between short, medium and long duration bonds, doesn't the bond "market" account for these risks by pricing them accordingly? Everyone knows, for example, that the Federal Reserve has signaled its intention to raise the Fed Funds rate several more times this year. Isn't that already priced in?
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Re: ???

Post by Leif » Sat Apr 07, 2018 2:30 pm

oldnewinvestor wrote:
Fri Apr 06, 2018 2:52 pm
Anyone buying today? :D
I Roth converted. Does that count?

Fridays seem to be a good day to buy/convert. Seems like it is often down when the market is volatile.

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Re: U.S. stocks in freefall

Post by WhiteMaxima » Sat Apr 07, 2018 2:48 pm

The question is: Are you ready for a -40% drop, interest back to 7~8% normal level, unemployment rate up to 10% , inflation rate +5~6%?

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Re: U.S. stocks in freefall

Post by minimalistmarc » Sat Apr 07, 2018 3:04 pm

WhiteMaxima wrote:
Sat Apr 07, 2018 2:48 pm
The question is: Are you ready for a -40% drop, interest back to 7~8% normal level, unemployment rate up to 10% , inflation rate +5~6%?
Sure, I'm ready for any hypothetical situation you want to imagine.

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Re: U.S. stocks in freefall

Post by LadyGeek » Sat Apr 07, 2018 3:12 pm

longinvest wrote:
Sat Apr 07, 2018 11:36 am
LadyGeek wrote:
Sat Apr 07, 2018 11:27 am
To say "bonds have a low correlation to stocks" another way: Bonds don't care what stocks do, they move for their own reasons.

This is very different than the inverse relationship between a bond's price and it's yield. See the wiki: Bond pricing
Something much more more important to consider than correlations is magnitude:
That's an excellent point, thanks.
Leif wrote:
Sat Apr 07, 2018 2:30 pm
oldnewinvestor wrote:
Fri Apr 06, 2018 2:52 pm
Anyone buying today? :D
I Roth converted. Does that count?

Fridays seem to be a good day to buy/convert. Seems like it is often down when the market is volatile.
I also like market dips on Fridays. Why? I have an employer retirement plan (401(k)). Purchases are automatically made on Friday. If I can get a lower price, that's great.
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Re: U.S. stocks in freefall

Post by H-Town » Sat Apr 07, 2018 3:14 pm

WhiteMaxima wrote:
Sat Apr 07, 2018 2:48 pm
The question is: Are you ready for a -40% drop, interest back to 7~8% normal level, unemployment rate up to 10% , inflation rate +5~6%?
I've seen worse.

People will survive... one way or the other.

Those who have high leverage in house mortgage, car loan, credit card debt, etc. will be the first to go out.

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Re: U.S. stocks in freefall

Post by david1082b » Sat Apr 07, 2018 3:36 pm

WhiteMaxima wrote:
Sat Apr 07, 2018 2:48 pm
The question is: Are you ready for a -40% drop, interest back to 7~8% normal level, unemployment rate up to 10% , inflation rate +5~6%?
Is 7 to 8% really a normal level? https://fred.stlouisfed.org/series/FEDFUNDS

It seems to be too variable to call any level normal.

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Re: U.S. stocks in freefall

Post by thx1138 » Sat Apr 07, 2018 3:49 pm

ReformedSpender wrote:
Sat Apr 07, 2018 9:31 am
Monday could provide another 'discount'

SPX was down more than -2% after another -2% day within the past 5 trading days. Though sample size is small (n=22), data on the following trading day since 1950 shows 10 of the last 14 have been negative.
Erm - you realize none of those figures even break a single standard deviation much less the more typical metric of two or three to be considered statistically significant?

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Re: U.S. stocks in freefall

Post by wrongfunds » Sat Apr 07, 2018 4:56 pm

I sort of understand the concept of "resistance" etc for a security but how does that concept work for market indices? Has the ETF really distorted it so much so that concept of earnings, future growth, investor confidence in upper management etc for a security now can be similarly to the basket of securities?

Because if that is NOT the case, then this technical analysis applied to indices seems to be just a laughably stupid concept.

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Re: U.S. stocks in freefall

Post by willthrill81 » Sat Apr 07, 2018 5:06 pm

wrongfunds wrote:
Sat Apr 07, 2018 4:56 pm
I sort of understand the concept of "resistance" etc for a security but how does that concept work for market indices? Has the ETF really distorted it so much so that concept of earnings, future growth, investor confidence in upper management etc for a security now can be similarly to the basket of securities?

Because if that is NOT the case, then this technical analysis applied to indices seems to be just a laughably stupid concept.
Actually, trend following, which uses the concept of 'resistance', actually works much better with indices than with individual stocks.
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Re: U.S. stocks in freefall

Post by MotoTrojan » Sat Apr 07, 2018 5:35 pm

wrongfunds wrote:
Sat Apr 07, 2018 4:56 pm
I sort of understand the concept of "resistance" etc for a security but how does that concept work for market indices? Has the ETF really distorted it so much so that concept of earnings, future growth, investor confidence in upper management etc for a security now can be similarly to the basket of securities?

Because if that is NOT the case, then this technical analysis applied to indices seems to be just a laughably stupid concept.
Interesting thought but have you not compared the daily movements of the S&P500 to the underlying securities? Kind of scary how correlated they are.

It is a two-way street in terms of feedback. A company can drag an index up/down but the index will also drag all its constituents as well.

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Re: U.S. stocks in freefall

Post by cfs » Mon Apr 09, 2018 12:11 am

Here we are, another week, get ready for "The Running of the Bulls" and no, we are not talking about the historic city of Pamplona. 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 oldcomputerguy » Mon Apr 09, 2018 5:04 am

MotoTrojan wrote:
Sat Apr 07, 2018 5:35 pm
Interesting thought but have you not compared the daily movements of the S&P500 to the underlying securities? Kind of scary how correlated they are.
I would imagine that the correlation between an index and its underlying securities would by nature be extremely high. It's the value of the underlying securities that makes up the value of the index, isn't it? Or am I missing a factor?
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Split from: U.S. stocks in freefall

Post by wrongfunds » Mon Apr 09, 2018 8:28 am

oldcomputerguy wrote:
Mon Apr 09, 2018 5:04 am
MotoTrojan wrote:
Sat Apr 07, 2018 5:35 pm
Interesting thought but have you not compared the daily movements of the S&P500 to the underlying securities? Kind of scary how correlated they are.
I would imagine that the correlation between an index and its underlying securities would by nature be extremely high. It's the value of the underlying securities that makes up the value of the index, isn't it? Or am I missing a factor?
It was supposed to be sarcastic comment. I got the sarcasm part of it. Unfortunately, he really did not address the main point that I was making:- Most of the reasoning behind trend analysis of a security price do not exist for an index. If it is mostly based on the investor sentiment (and/or stupidity) which means affinity for "round numbers", applying that concept to index means ETFs have to have very significant market share as compared to the individual securities when it comes to trading. I do not know if that is the case or not.

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Re: U.S. stocks in freefall

Post by oldcomputerguy » Mon Apr 09, 2018 9:05 am

wrongfunds wrote:
Mon Apr 09, 2018 8:28 am
It was supposed to be sarcastic comment. I got the sarcasm part of it.
Oh, okay. Sorry about that, I think sometimes that my sarcasm detector doesn't kick in until after the second cup of coffee.
:oops:
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Re: U.S. stocks in freefall

Post by wrongfunds » Mon Apr 09, 2018 9:39 am

It is obvious that underlying securities directly affect the index. But does that automatically imply index affects underlying securities? The snarky comment implied index is related to securities but that fact was never in dispute.

Oh well, trend analysis is really a study in investor psychology and and I am amused by it. Some of you might think there is real mathematics (aka science) behind it. I still laugh at that though.

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Re: U.S. stocks in freefall

Post by livesoft » Mon Apr 09, 2018 9:48 am

wrongfunds wrote:
Mon Apr 09, 2018 9:39 am
Oh well, trend analysis is really a study in investor psychology and and I am amused by it. Some of you might think there is real mathematics (aka science) behind it. I still laugh at that though.
I know you didn't mean Investor Psychology was unimportant. :)

After all Richard Thaler won an award for essentially work in the study of Investor Psychology and there were some previous awards, too. :sharebeer
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Re: U.S. stocks in freefall

Post by MotoTrojan » Mon Apr 09, 2018 10:32 am

wrongfunds wrote:
Mon Apr 09, 2018 9:39 am
It is obvious that underlying securities directly affect the index. But does that automatically imply index affects underlying securities? The snarky comment implied index is related to securities but that fact was never in dispute.

Oh well, trend analysis is really a study in investor psychology and and I am amused by it. Some of you might think there is real mathematics (aka science) behind it. I still laugh at that though.
Poor language, yes. Snark, no. Sorry again.

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Re: U.S. stocks in freefall

Post by cfs » Mon Apr 09, 2018 11:44 am

Already then . . .

Time to get back on track with the stocks in free fall . . .

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 cfs » Tue Apr 10, 2018 2:34 pm

The Running of the Bulls

And the good thing, no bad fake news to slow the running (as of this moment).

Good luck, y gracias por leer ~cfs~

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Re: U.S. stocks in freefall

Post by LadyGeek » Tue Apr 10, 2018 4:27 pm

I removed several posts related to people with STEM (Science Technology Engineering Math) backgrounds. This may be a misunderstanding of intent, but the thread was getting derailed.
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Re: U.S. stocks in freefall

Post by carofe » Wed Apr 11, 2018 9:20 am

I read recently in the WSJ that people were overdoing it when purchasing houses with at least 10% of them going over 45% debt-to-income ratio. Living on the edge with the mortgage. Now I got today in the Moneybeat magazine that the oil price is going up, expecting a $80 a barrel by the end of the year.
I expect some trouble ahead if that continues: the rise of oil price will impact the price of basic necessities like transportation and food, and that will derail people living on the edge with little margin of safety regarding cash flow.
On top of that there is no much new houses being built and that trend seems to be a very hard one to correct this time (in another WSJ article).
The only way this would be sostainable is if the income raised more than all that.
All this current volatily in the stock market is based on the news, speculation. I don’t see much real data showing bad stuff ... yet.
US Total Stock Market + Intermediate Term Bond. That's it.

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willthrill81
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Re: U.S. stocks in freefall

Post by willthrill81 » Wed Apr 11, 2018 9:24 am

carofe wrote:
Wed Apr 11, 2018 9:20 am
I read recently in the WSJ that people were overdoing it when purchasing houses with at least 10% of them going over 45% debt-to-income ratio.
A big part of this is that the biggest cities in the U.S. have become extremely expensive in terms of homes. In cities like New York, San Francisco, Seattle, San Jose, etc., it's typical for mortgages to exceed 40% of the borrower's net income, and many are over 50%.
“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 MotoTrojan » Wed Apr 11, 2018 9:29 am

willthrill81 wrote:
Wed Apr 11, 2018 9:24 am
carofe wrote:
Wed Apr 11, 2018 9:20 am
I read recently in the WSJ that people were overdoing it when purchasing houses with at least 10% of them going over 45% debt-to-income ratio.
A big part of this is that the biggest cities in the U.S. have become extremely expensive in terms of homes. In cities like New York, San Francisco, Seattle, San Jose, etc., it's typical for mortgages to exceed 40% of the borrower's net income, and many are over 50%.
A lot easier to go 40-50%+ when you make $400K.

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Re: U.S. stocks in freefall

Post by cfs » Wed Apr 11, 2018 10:57 am

The Running of the Bulls

Yes, they are running again . . . and you just don't want to be out of this market for ONE day!

Gracias por leer ~cfs~
~ Member of the Active Retired Force since 2014 ~

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Re: U.S. stocks in freefall

Post by 2015 » Wed Apr 11, 2018 12:13 pm

MotoTrojan wrote:
Wed Apr 11, 2018 9:29 am
willthrill81 wrote:
Wed Apr 11, 2018 9:24 am
carofe wrote:
Wed Apr 11, 2018 9:20 am
I read recently in the WSJ that people were overdoing it when purchasing houses with at least 10% of them going over 45% debt-to-income ratio.
A big part of this is that the biggest cities in the U.S. have become extremely expensive in terms of homes. In cities like New York, San Francisco, Seattle, San Jose, etc., it's typical for mortgages to exceed 40% of the borrower's net income, and many are over 50%.
A lot easier to go 40-50%+ when you make $400K.
See this as well:

https://slate.com/business/2018/04/you- ... ng-it.html
There are two types of cities in America. In some of them, the people moving in are better educated and make more money than the people moving out. In others, the opposite is true.

In the former category, we have, of course, San Francisco, where over the past 12 years the median in-migrant has earned $12,640 a year more than the median out-migrant did before he or she left. New York, Los Angeles, and Miami are also metro areas where new arrivals make, at the median, more than $5,000 more than their outgoing counterparts. There is something intuitive about this: People are liable to move away when things aren’t going well, and arrive because they’ve gotten a great job.
As to the "freefall", still waiting on my TLH opportunity...

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Re: U.S. stocks in freefall

Post by cfs » Thu Apr 12, 2018 9:53 am

The Running of the Bulls

Investors on the higher floors are feeling better this morning! Oh by the way, you just don't want to be out of this market for ONE day!

Gracias por leer ~cfs~
~ Member of the Active Retired Force since 2014 ~

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Re: U.S. stocks in freefall

Post by willthrill81 » Thu Apr 12, 2018 10:52 am

MotoTrojan wrote:
Wed Apr 11, 2018 9:29 am
willthrill81 wrote:
Wed Apr 11, 2018 9:24 am
carofe wrote:
Wed Apr 11, 2018 9:20 am
I read recently in the WSJ that people were overdoing it when purchasing houses with at least 10% of them going over 45% debt-to-income ratio.
A big part of this is that the biggest cities in the U.S. have become extremely expensive in terms of homes. In cities like New York, San Francisco, Seattle, San Jose, etc., it's typical for mortgages to exceed 40% of the borrower's net income, and many are over 50%.
A lot easier to go 40-50%+ when you make $400K.
It's not just easier; it's necessary to have a significantly higher than national median income. If your income, sales, and property taxes and mortgage consume 60-70% or more of your income, the only way you can survive on the remaining 30-40% is if your starting income was quite high to start with.
“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 JoMoney » Fri Apr 13, 2018 5:15 pm

JoMoney wrote:
Sat Apr 07, 2018 9:37 am
My guess is that it won't go much lower next week, primarily because my regular paycheck contribution will be going on and it feels like I'm always hitting the up-trends rather than the down.
Also, there seems to be support on the S&P just above the $2,580 level, it's bounced off that area on down-turns a couple times this year.
That played out as expected. No idea what happens from here, long term I expect UP UP UP... but it would seem typical for me if it dropped a little more next week since my regular contribution just went in.
"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 cfs » Mon Apr 16, 2018 11:32 am

The Running of the Bulls

Oh boy, they are back, at least for the past couple of minutes.

You just don't want to be out of this market for ONE day!

Gracias por leer ~cfs~
~ Member of the Active Retired Force since 2014 ~

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