[Market is acting like late August, 2000, or late October, 2007]

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midareff
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[Market is acting like late August, 2000, or late October, 2007]

Post by midareff » Fri Feb 14, 2020 5:58 pm

[Title was "It's starting to smell like " --admin LadyGeek]

late August, 2000, or late October, 2007. New record repeated day, after day, after day, doesn't always lead to good things. AT 48% equities I'm not very twitchy about it although this can't go on forever.

Your thoughts?

Pierre Delecto
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Re: It's starting to smell like

Post by Pierre Delecto » Fri Feb 14, 2020 5:59 pm

midareff wrote:
Fri Feb 14, 2020 5:58 pm
late August, 2000, or late October, 2007. New record repeated day, after day, after day, doesn't always lead to good things. AT 48% equities I'm not very twitchy about it although this can't go on forever.

Your thoughts?
Keep these types of posts coming! The more people see bubbles, the less likely we’re to be in one.

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White Coat Investor
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Re: It's starting to smell like

Post by White Coat Investor » Fri Feb 14, 2020 6:03 pm

If I was only 48% equities, I'm not sure I would spend any time worrying about the stocks in my portfolio. :)
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course

Shamb3
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Re: It's starting to smell like

Post by Shamb3 » Fri Feb 14, 2020 6:03 pm

After I thought I smelled it (but did nothing) in 2011, 2013, 2015 and 2018...
I kind of decided my nose doesn't work.

It will happen someday. :beer
I wouldn't mind if it went sideways for a few years.

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Bluce
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Re: It's starting to smell like

Post by Bluce » Fri Feb 14, 2020 6:04 pm

IT'S GOING TO CRASH! :oops:

We just don't know when. :(

Lee_WSP
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Re: It's starting to smell like

Post by Lee_WSP » Fri Feb 14, 2020 6:07 pm

Or does it smell like 1996 or 2005? For all we know, it'll crash back to today's levels or slightly under and then bounce back quickly to today's levels where it'll bounce around for a bit, and then continue on like nothing happened.

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JoeRetire
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Re: It's starting to smell like

Post by JoeRetire » Fri Feb 14, 2020 6:08 pm

midareff wrote:
Fri Feb 14, 2020 5:58 pm
late August, 2000, or late October, 2007. New record repeated day, after day, after day, doesn't always lead to good things. AT 48% equities I'm not very twitchy about it although this can't go on forever.

Your thoughts?
I'm not smelling it.
Very Stable Genius

depressed
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Re: It's starting to smell like

Post by depressed » Fri Feb 14, 2020 6:09 pm

I shifted down from my usual asset allocation to 15% stock at the market close yesterday and I slept much better than usual last night.

CoastalWinds
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Re: It's starting to smell like

Post by CoastalWinds » Fri Feb 14, 2020 6:10 pm

It smells like beans.

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Devil's Advocate
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Re: It's starting to smell like

Post by Devil's Advocate » Fri Feb 14, 2020 6:12 pm

Teen Spirit?

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oldzey
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Re: It's starting to smell like

Post by oldzey » Fri Feb 14, 2020 6:13 pm

What's in your coffee cup?

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

Elysium
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by Elysium » Fri Feb 14, 2020 6:20 pm

Don't recall posts like this in August 2000 or October 2007, so.... may be it is not, just sayin'

bitdocmd
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Re: It's starting to smell like

Post by bitdocmd » Fri Feb 14, 2020 6:23 pm

midareff wrote:
Fri Feb 14, 2020 5:58 pm
late August, 2000, or late October, 2007. New record repeated day, after day, after day, doesn't always lead to good things. AT 48% equities I'm not very twitchy about it although this can't go on forever.

Your thoughts?
Most of my net worth is in the market. I know it's a bubble, but a bubble that the Fed will continue to support. What other choice do I have but to put my cash into the market? The search for yield as they say...

I also have bitcoin as a hedge.

Pierre Delecto
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Re: It's starting to smell like

Post by Pierre Delecto » Fri Feb 14, 2020 6:23 pm

depressed wrote:
Fri Feb 14, 2020 6:09 pm
I shifted down from my usual asset allocation to 15% stock at the market close yesterday and I slept much better than usual last night.
Will be interesting to see if you regret this move ultimately. I’d rather just ride the roller coaster and not have to worry about making such decisions.

minesweep
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Re: It's starting to smell like

Post by minesweep » Fri Feb 14, 2020 6:24 pm

There is still a lot of cash sitting on the sidelines that could push the stock market to higher levels.
These fund assets now stand at $3.6 trillion, the highest level in more than 10 years, but still below the $3.9 trillion peak in January 2009.

Investors pulled their cash out of the market in droves during the recession caused by the financial crisis. The economy recovered, and the S&P 500 has rallied more than 250% since then. But money market asset levels show that some investors are still cautious.
Stocks are near record highs, but people are still not investing

MotoTrojan
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Re: It's starting to smell like

Post by MotoTrojan » Fri Feb 14, 2020 6:25 pm

depressed wrote:
Fri Feb 14, 2020 6:09 pm
I shifted down from my usual asset allocation to 15% stock at the market close yesterday and I slept much better than usual last night.
What’s usual?

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Watty
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by Watty » Fri Feb 14, 2020 6:31 pm

midareff wrote:
Fri Feb 14, 2020 5:58 pm
AT 48% equities I'm not very twitchy about it although this can't go on forever.

Your thoughts?
Everytime it goes up a bit I sell off some stocks to buy some more bonds.

Of course that is just my target date fund rebalancing each day.

depressed
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Re: It's starting to smell like

Post by depressed » Fri Feb 14, 2020 6:53 pm

MotoTrojan wrote:
Fri Feb 14, 2020 6:25 pm
depressed wrote:
Fri Feb 14, 2020 6:09 pm
I shifted down from my usual asset allocation to 15% stock at the market close yesterday and I slept much better than usual last night.
What’s usual?
Lately, "usual" has meant waking around 2 to 3am and not getting back to sleep until 5 or 6.

Pierre Delecto
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Re: It's starting to smell like

Post by Pierre Delecto » Fri Feb 14, 2020 6:54 pm

depressed wrote:
Fri Feb 14, 2020 6:53 pm
MotoTrojan wrote:
Fri Feb 14, 2020 6:25 pm
depressed wrote:
Fri Feb 14, 2020 6:09 pm
I shifted down from my usual asset allocation to 15% stock at the market close yesterday and I slept much better than usual last night.
What’s usual?
Lately, "usual" has meant waking around 2 to 3am and not getting back to sleep until 5 or 6.
Jeepers. That’s rough!

Trader Joe
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by Trader Joe » Fri Feb 14, 2020 6:56 pm

midareff wrote:
Fri Feb 14, 2020 5:58 pm
[Title was "It's starting to smell like " --admin LadyGeek]

late August, 2000, or late October, 2007. New record repeated day, after day, after day, doesn't always lead to good things. AT 48% equities I'm not very twitchy about it although this can't go on forever.

Your thoughts?
My thoughts are that you should tune out the noise and stay the course.

lostdog
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by lostdog » Fri Feb 14, 2020 7:05 pm

There is no FOMO from the non-investor crowd.
World market cap equity.

manatee2005
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by manatee2005 » Fri Feb 14, 2020 7:30 pm

Is your Uber driver giving you hot stock picks?

Are high school kids opening brokerage accounts to trade?

If no, then it’s nothing like 2000.

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firedup
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by firedup » Fri Feb 14, 2020 7:42 pm

I have no ability to predict the future (darn) so I just keep on keepin' on...
"We are more alike, my friends, than we are unalike" --Maya Angelou

stocknoob4111
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by stocknoob4111 » Fri Feb 14, 2020 7:52 pm

The only thing going up is the S&P 500. All the other indexes and asset classes are not doing too well...

Small Caps (S&P 600 and Russell 2000 are struggling and have been for a while now)
Bonds (they are flashing RED for a while now with the curve inverting again couple weeks ago)
International (not just because of the Coronavirus - this asset class was not doing so hot even before this whole virus thing)

When the S&P 500 is the lone actor rocketing to new highs in a sea of others that are sputtering then one has to be rather naive to think that all is well :!:

Triple digit golfer
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by Triple digit golfer » Fri Feb 14, 2020 8:19 pm

stocknoob4111 wrote:
Fri Feb 14, 2020 7:52 pm
The only thing going up is the S&P 500. All the other indexes and asset classes are not doing too well...

Small Caps (S&P 600 and Russell 2000 are struggling and have been for a while now)
Bonds (they are flashing RED for a while now with the curve inverting again couple weeks ago)
International (not just because of the Coronavirus - this asset class was not doing so hot even before this whole virus thing)

When the S&P 500 is the lone actor rocketing to new highs in a sea of others that are sputtering then one has to be rather naive to think that all is well :!:
The S&P 500 basically is the market. So yes, the only thing going up is the market.

GoldenFinch
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by GoldenFinch » Fri Feb 14, 2020 8:23 pm

After watching the market go down day after day after day, some years ago, can’t we just have a reprieve?

ballons
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by ballons » Fri Feb 14, 2020 8:37 pm

manatee2005 wrote:
Fri Feb 14, 2020 7:30 pm
Is your Uber driver giving you hot stock picks?

Are high school kids opening brokerage accounts to trade?

If no, then it’s nothing like 2000.
Yes.

https://www.telegraph.co.uk/technology/ ... la-shares/

https://old.reddit.com/r/wallstreetbets/

https://www.bloomberg.com/news/videos/2 ... enzy-video
@ 1:00 mark.

stocknoob4111
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by stocknoob4111 » Fri Feb 14, 2020 8:48 pm

Triple digit golfer wrote:
Fri Feb 14, 2020 8:19 pm
The S&P 500 basically is the market. So yes, the only thing going up is the market.
The equity market comprises of various other asset classes so no the S&P 500 isn't the "market", it's only *part* of the market namely Large Cap Blend. Even within the S&P 500 it's only the megacap techs that are performing strongly, there are a large percentage in there that are not doing too well.

Let's look at the S&P 500's January performance under the hood:

XLU (Utilities): +6.75%
XLK (Technology): +3.99%
XLRE (Real Estate): +1.45%
XLP (Consumer Staples): +0.32%

XLY (Consumer Discretionary): -0.08%
XLI (Industrials): -0.44%
XLF (Financials): -2.66%
XLV (Healthcare): -2.67%
XLB (Materials): -6.17%
XLE (Energy): -10.99%


The sectors doing good are the very defensive sectors (Utilities, Real Estate) and Tech while everything else was in the RED.

z3r0c00l
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by z3r0c00l » Fri Feb 14, 2020 8:53 pm

I would guess this is the early 90's. A minor recession will be followed with another boom, then I can retire.

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whodidntante
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Re: It's starting to smell like

Post by whodidntante » Fri Feb 14, 2020 8:55 pm

bitdocmd wrote:
Fri Feb 14, 2020 6:23 pm
midareff wrote:
Fri Feb 14, 2020 5:58 pm
late August, 2000, or late October, 2007. New record repeated day, after day, after day, doesn't always lead to good things. AT 48% equities I'm not very twitchy about it although this can't go on forever.

Your thoughts?
Most of my net worth is in the market. I know it's a bubble, but a bubble that the Fed will continue to support. What other choice do I have but to put my cash into the market? The search for yield as they say...

I also have bitcoin as a hedge.
What does bitcoin hedge? Dollars?

Triple digit golfer
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by Triple digit golfer » Fri Feb 14, 2020 8:56 pm

stocknoob4111 wrote:
Fri Feb 14, 2020 8:48 pm
Triple digit golfer wrote:
Fri Feb 14, 2020 8:19 pm
The S&P 500 basically is the market. So yes, the only thing going up is the market.
The equity market comprises of various other asset classes so no the S&P 500 isn't the "market", it's only *part* of the market namely Large Cap Blend. Even within the S&P 500 it's only the megacap techs that are performing strongly, there are a large percentage in there that are not doing too well.

Let's look at the S&P 500's January performance under the hood:

XLU (Utilities): +6.75%
XLK (Technology): +3.99%
XLRE (Real Estate): +1.45%
XLP (Consumer Staples): +0.32%

XLY (Consumer Discretionary): -0.08%
XLI (Industrials): -0.44%
XLF (Financials): -2.66%
XLV (Healthcare): -2.67%
XLB (Materials): -6.17%
XLE (Energy): -10.99%


The sectors doing good are the very defensive sectors (Utilities, Real Estate) and Tech while everything else was in the RED.
Yes. But by definition, the market is doing well and in fact is at an all time high.

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TheTimeLord
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by TheTimeLord » Fri Feb 14, 2020 8:56 pm

midareff wrote:
Fri Feb 14, 2020 5:58 pm
[Title was "It's starting to smell like " --admin LadyGeek]

late August, 2000, or late October, 2007. New record repeated day, after day, after day, doesn't always lead to good things. AT 48% equities I'm not very twitchy about it although this can't go on forever.

Your thoughts?
See January 2018. How quickly we forget.
IMHO, Investing should be about living the life you want, not avoiding the life you fear. | Run, You Clever Boy! [9085]


rascott
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by rascott » Fri Feb 14, 2020 9:07 pm

stocknoob4111 wrote:
Fri Feb 14, 2020 8:48 pm
Triple digit golfer wrote:
Fri Feb 14, 2020 8:19 pm
The S&P 500 basically is the market. So yes, the only thing going up is the market.
The equity market comprises of various other asset classes so no the S&P 500 isn't the "market", it's only *part* of the market namely Large Cap Blend. Even within the S&P 500 it's only the megacap techs that are performing strongly, there are a large percentage in there that are not doing too well.

Let's look at the S&P 500's January performance under the hood:

XLU (Utilities): +6.75%
XLK (Technology): +3.99%
XLRE (Real Estate): +1.45%
XLP (Consumer Staples): +0.32%

XLY (Consumer Discretionary): -0.08%
XLI (Industrials): -0.44%
XLF (Financials): -2.66%
XLV (Healthcare): -2.67%
XLB (Materials): -6.17%
XLE (Energy): -10.99%


The sectors doing good are the very defensive sectors (Utilities, Real Estate) and Tech while everything else was in the RED.


I'm someone with a healthy small cap tilt..... but the "market" is most certainly the SP500.... at least it is when discussing the US equity market. This holds true both in finance and academia.

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TheTimeLord
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by TheTimeLord » Fri Feb 14, 2020 9:23 pm

rascott wrote:
Fri Feb 14, 2020 9:07 pm
stocknoob4111 wrote:
Fri Feb 14, 2020 8:48 pm
Triple digit golfer wrote:
Fri Feb 14, 2020 8:19 pm
The S&P 500 basically is the market. So yes, the only thing going up is the market.
The equity market comprises of various other asset classes so no the S&P 500 isn't the "market", it's only *part* of the market namely Large Cap Blend. Even within the S&P 500 it's only the megacap techs that are performing strongly, there are a large percentage in there that are not doing too well.

Let's look at the S&P 500's January performance under the hood:

XLU (Utilities): +6.75%
XLK (Technology): +3.99%
XLRE (Real Estate): +1.45%
XLP (Consumer Staples): +0.32%

XLY (Consumer Discretionary): -0.08%
XLI (Industrials): -0.44%
XLF (Financials): -2.66%
XLV (Healthcare): -2.67%
XLB (Materials): -6.17%
XLE (Energy): -10.99%


The sectors doing good are the very defensive sectors (Utilities, Real Estate) and Tech while everything else was in the RED.


I'm someone with a healthy small cap tilt..... but the "market" is most certainly the SP500.... at least it is when discussing the US equity market. This holds true both in finance and academia.
100% Agree. S&P 500 = The U.S. Market
IMHO, Investing should be about living the life you want, not avoiding the life you fear. | Run, You Clever Boy! [9085]

Grt2bOutdoors
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Re: It's starting to smell like

Post by Grt2bOutdoors » Fri Feb 14, 2020 9:26 pm

minesweep wrote:
Fri Feb 14, 2020 6:24 pm
There is still a lot of cash sitting on the sidelines that could push the stock market to higher levels.
These fund assets now stand at $3.6 trillion, the highest level in more than 10 years, but still below the $3.9 trillion peak in January 2009.

Investors pulled their cash out of the market in droves during the recession caused by the financial crisis. The economy recovered, and the S&P 500 has rallied more than 250% since then. But money market asset levels show that some investors are still cautious.
Stocks are near record highs, but people are still not investing
Yes, there is cash out there but you are dreaming if you think the cash is going to come back into the market. The cash is there for reasons other than being invested in securities. It could be used for consumption, investing in other non public assets, payment of taxes, buying a house or having a large emergency fund in case of the boogey man.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

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TheTimeLord
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by TheTimeLord » Fri Feb 14, 2020 9:27 pm

stocknoob4111 wrote:
Fri Feb 14, 2020 8:48 pm
Triple digit golfer wrote:
Fri Feb 14, 2020 8:19 pm
The S&P 500 basically is the market. So yes, the only thing going up is the market.
The equity market comprises of various other asset classes so no the S&P 500 isn't the "market", it's only *part* of the market namely Large Cap Blend. Even within the S&P 500 it's only the megacap techs that are performing strongly, there are a large percentage in there that are not doing too well.

Let's look at the S&P 500's January performance under the hood:

XLU (Utilities): +6.75%
XLK (Technology): +3.99%
XLRE (Real Estate): +1.45%
XLP (Consumer Staples): +0.32%

XLY (Consumer Discretionary): -0.08%
XLI (Industrials): -0.44%
XLF (Financials): -2.66%
XLV (Healthcare): -2.67%
XLB (Materials): -6.17%
XLE (Energy): -10.99%


The sectors doing good are the very defensive sectors (Utilities, Real Estate) and Tech while everything else was in the RED.
I think I saw that on CNBC today.
IMHO, Investing should be about living the life you want, not avoiding the life you fear. | Run, You Clever Boy! [9085]

Slick8503
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Re: It's starting to smell like

Post by Slick8503 » Fri Feb 14, 2020 9:40 pm

Grt2bOutdoors wrote:
Fri Feb 14, 2020 9:26 pm
minesweep wrote:
Fri Feb 14, 2020 6:24 pm
There is still a lot of cash sitting on the sidelines that could push the stock market to higher levels.
These fund assets now stand at $3.6 trillion, the highest level in more than 10 years, but still below the $3.9 trillion peak in January 2009.

Investors pulled their cash out of the market in droves during the recession caused by the financial crisis. The economy recovered, and the S&P 500 has rallied more than 250% since then. But money market asset levels show that some investors are still cautious.
Stocks are near record highs, but people are still not investing
Yes, there is cash out there but you are dreaming if you think the cash is going to come back into the market. The cash is there for reasons other than being invested in securities. It could be used for consumption, investing in other non public assets, payment of taxes, buying a house or having a large emergency fund in case of the boogey man.
Also, I would imagine that as a percentage of the investable assets the 3.6 2009 number represents a lot larger portion than the 3.9 2020 number. Asset values are much much higher now than then.

Random Walker
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Re: It's starting to smell like

Post by Random Walker » Fri Feb 14, 2020 9:49 pm

White Coat Investor wrote:
Fri Feb 14, 2020 6:03 pm
If I was only 48% equities, I'm not sure I would spend any time worrying about the stocks in my portfolio. :)
Even with 48% equities, probably 75-80% of the portfolio risk is on the equity side.

Dave
Last edited by Random Walker on Fri Feb 14, 2020 9:52 pm, edited 1 time in total.

gorow
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Re: It's starting to smell like

Post by gorow » Fri Feb 14, 2020 9:53 pm

Bluce wrote:
Fri Feb 14, 2020 6:04 pm
IT'S GOING TO CRASH! :oops:

We just don't know when. :(
Or not. Maybe fall a bit, but maybe crash. Or maybe not.
Retired 1/1/2019. Not concerned about sequence of returns because two years here taught me what I need to know.

pasadena
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by pasadena » Fri Feb 14, 2020 10:06 pm

In 2000, I was 26 years old, had 0 money invested, and didn't pay much attention to the stock market, if at all. I was, however, watching the news, and working in tech, personally riding the rise of the Internet (not professionally). I vividly remember all those million dollars deals where people were buying and investing in tech startups with zero business model. Like hey, I created a free webmail site, have a few thousand people on it, please buy me out and give me 5 million dollars. Even me, knowing nothing about big money, was thinking "this is stupid".

Irrational exuberance was spot-on.

I don't see that today. I see 20 years of incredible technological progress with a field that has cleared out by now, big companies with smart people at the lead, solid finances for most of them, and fascinating prospects in terms of more technological progress. I do believe cloud computing is the future of corporate IT, and that is just beginning. And that is just one example. These tech companies are also very much diversified.

I have no idea what was going on in 2005-2007, as this originated almost exclusively from the US and I wasn't living there.

Will it get back to earth a little? A lot? Will it take a breather? Will the US elections have any impact? Maybe. Is there something else lurking that we don't see, like in 2007? Maybe. But comparing what's going on today with what was happening in 2000 is incorrect, imo.

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zaboomafoozarg
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Re: It's starting to smell like

Post by zaboomafoozarg » Fri Feb 14, 2020 10:22 pm

Pierre Delecto wrote:
Fri Feb 14, 2020 5:59 pm
Keep these types of posts coming! The more people see bubbles, the less likely we’re to be in one.
When the prices hit a "permanently high plateau", that's when you gotta worry.

MotoTrojan
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Re: It's starting to smell like

Post by MotoTrojan » Sat Feb 15, 2020 1:44 pm

depressed wrote:
Fri Feb 14, 2020 6:53 pm
MotoTrojan wrote:
Fri Feb 14, 2020 6:25 pm
depressed wrote:
Fri Feb 14, 2020 6:09 pm
I shifted down from my usual asset allocation to 15% stock at the market close yesterday and I slept much better than usual last night.
What’s usual?
Lately, "usual" has meant waking around 2 to 3am and not getting back to sleep until 5 or 6.
Glad to hear that improved. I meant what is your usual asset allocation :greedy .

thelateinvestor43
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by thelateinvestor43 » Sun Feb 16, 2020 12:28 am

How come it's not wise to pull most of your stocks out BEFORE a crash? Pardon me, I'm still only 3 months into investing.

For example, I hear people here say "Take a little money off the table" quite a bit, like that's ok. Why isn't it ok to take most of it off the table if we think the coronavirus and other things are gonna tank us 30-50% or more?

flaccidsteele
Posts: 253
Joined: Sun Jul 28, 2019 9:42 pm
Location: Canada

Re: [Market is acting like late August, 2000, or late October, 2007]

Post by flaccidsteele » Sun Feb 16, 2020 12:32 am

midareff wrote:
Fri Feb 14, 2020 5:58 pm
[Title was "It's starting to smell like " --admin LadyGeek]

late August, 2000, or late October, 2007. New record repeated day, after day, after day, doesn't always lead to good things. AT 48% equities I'm not very twitchy about it although this can't go on forever.

Your thoughts?
I agree

As someone who started investing in the 90s and went through the 2000 and 2007 crashes, today feels similar. That is, it’s almost impossible for me to find anything to do with my portfolio except watch capital gains and cash pile up

I wouldn’t worry about it. It’s just part of a cycle that’s been repeating for longer than anyone on this forum has been alive
The US market always recovers. It’s never different this time. Retired in my 40s. Investing is a simple game of rinse and repeat

Ping Pong
Posts: 518
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Re: It's starting to smell like

Post by Ping Pong » Sun Feb 16, 2020 2:59 am

minesweep wrote:
Fri Feb 14, 2020 6:24 pm
There is still a lot of cash sitting on the sidelines that could push the stock market to higher levels.
Isn’t cash just short-short-term bonds? For every buyer there is a seller, so if all the cash were used to buy stock, you’d still have the same amount of cash and stock out there. They would just have new owners.

Gemini1962
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Joined: Sun Jan 26, 2020 5:22 am

Re: [Market is acting like late August, 2000, or late October, 2007]

Post by Gemini1962 » Sun Feb 16, 2020 5:39 am

thelateinvestor43 wrote:
Sun Feb 16, 2020 12:28 am
How come it's not wise to pull most of your stocks out BEFORE a crash? Pardon me, I'm still only 3 months into investing.

For example, I hear people here say "Take a little money off the table" quite a bit, like that's ok. Why isn't it ok to take most of it off the table if we think the coronavirus and other things are gonna tank us 30-50% or more?
Because nobody can predict where the market is going and studies show that market timing doesn't work. You have to be right twice, once when you sell and again when you buy back. There's a great chapter on it in Charlie Ellis's book Winning the Loser's Game.

thelateinvestor43
Posts: 468
Joined: Fri Nov 15, 2019 2:02 am
Location: Westbrook, Maine

Re: [Market is acting like late August, 2000, or late October, 2007]

Post by thelateinvestor43 » Sun Feb 16, 2020 6:27 am

Gemini1962 wrote:
Sun Feb 16, 2020 5:39 am
thelateinvestor43 wrote:
Sun Feb 16, 2020 12:28 am
How come it's not wise to pull most of your stocks out BEFORE a crash? Pardon me, I'm still only 3 months into investing.

For example, I hear people here say "Take a little money off the table" quite a bit, like that's ok. Why isn't it ok to take most of it off the table if we think the coronavirus and other things are gonna tank us 30-50% or more?
Because nobody can predict where the market is going and studies show that market timing doesn't work. You have to be right twice, once when you sell and again when you buy back. There's a great chapter on it in Charlie Ellis's book Winning the Loser's Game.
Yes but with this virus I think it will crash. Basically China is shut down. We'll see what happens on Tuesday, but I'm getting scared.

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firebirdparts
Posts: 700
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Re: [Market is acting like late August, 2000, or late October, 2007]

Post by firebirdparts » Sun Feb 16, 2020 7:39 am

thelateinvestor43 wrote:
Sun Feb 16, 2020 12:28 am
How come it's not wise to pull most of your stocks out BEFORE a crash? Pardon me, I'm still only 3 months into investing.
It just doesn't work. You can try it. It just doesn't work. What happens is you decide when the crash is going to be (like for our purposes let's say the crash is going to come March 1. So then you take your money out around February 25th just to give it a wide margin. Then it doesn't crash on march 1, so we wait for it to crash. Then what? You're just sitting there holding the bag. Market goes up another 10% and then it's Christmas. Then what?

So what's the problem? The problem is you deciding it's going to crash on March 1. It's not up to you.
A fool and your money are soon partners

thelateinvestor43
Posts: 468
Joined: Fri Nov 15, 2019 2:02 am
Location: Westbrook, Maine

Re: [Market is acting like late August, 2000, or late October, 2007]

Post by thelateinvestor43 » Sun Feb 16, 2020 8:30 am

firebirdparts wrote:
Sun Feb 16, 2020 7:39 am
thelateinvestor43 wrote:
Sun Feb 16, 2020 12:28 am
How come it's not wise to pull most of your stocks out BEFORE a crash? Pardon me, I'm still only 3 months into investing.
It just doesn't work. You can try it. It just doesn't work. What happens is you decide when the crash is going to be (like for our purposes let's say the crash is going to come March 1. So then you take your money out around February 25th just to give it a wide margin. Then it doesn't crash on march 1, so we wait for it to crash. Then what? You're just sitting there holding the bag. Market goes up another 10% and then it's Christmas. Then what?

So what's the problem? The problem is you deciding it's going to crash on March 1. It's not up to you.
Yeah, I think I get it, but I'm still worried.

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