Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Are we are LONG on Short Term thinking?
Old 08-15-2011, 10:44 AM   #1
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Chuckanut's Avatar
 
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 6,318
Are we are LONG on Short Term thinking?

I have been browsing a number of articles concerning how the retired and soon-to-be retireed should deal with the stock market events of the past few weeks. They are in various issues of the financial press.

My impression is that they all seem to be written from a very short term point of view. The implication is that low interest rates will continue for decades, as will volatile markets that plung down more often than moving up. Am I imagining this bias?

Where is the long view? Whatever happened to staying the course, or making a few minor corrections? Certainly, with interest rates at historic lows, one can be excused for taking a WR of 3% instead of 4% and cutting spending accordingly. But, suddenly these guys are advising, dumping those risky stocks, and buying fixed annuities, moving most money to guanteed CD's and treasury bonds, etc.

It seems we are in the grips of a real herd mentality when it comes to the financial press. Today, after volatile down days, we are advised to move into CD's, treasuries, and high dividend stocks. (Why didn't these experts tell us that BEFORE the market gave back most of its yearly gains?) When the market was going up earlier in the year we were told to have a good portion in growth stocks or market indexes so as to keep up with inflation. This financial press seems to operate on the flavor of the day approach.

Your thoughts?
__________________

__________________
The worst decisions are usually made in times of anger and impatience.
Chuckanut is online now   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 08-15-2011, 11:00 AM   #2
Thinks s/he gets paid by the post
GregLee's Avatar
 
Join Date: Oct 2010
Location: Waimanalo, HI
Posts: 1,881
So far as I know, everyone agrees with the buy low/sell high strategy. And since stocks are low and bonds are high, it seems obvious what to do (if anything).
__________________

__________________
Greg (retired in 2010 at age 68, state pension)
GregLee is offline   Reply With Quote
Old 08-15-2011, 11:03 AM   #3
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,074
Quote:
Originally Posted by Chuckanut View Post
It seems we are in the grips of a real herd mentality when it comes to the financial press.
Staying the course is boring and been done. Panic, gloom & doom, and calls for an alien invasion make headlines and pumps up readership. Nothing new here.
__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Old 08-15-2011, 12:15 PM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Chuckanut's Avatar
 
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 6,318
OK, so I read an article that tells us we should have already moved most of our money out of stock to more stable investments before this all started. GREAT! But, the article does not tell us how to build a time machine, NOT SO GREAT!

Well, I found the directions on how to build a time machine on the Internet. Build Your Own Time Machine: Science Channel

But, unfortunately, the author does not define the word 'most'. Is that over 50%, 60%, 80%?? We don't know. So I will define it myself to be 75%. The same source about 8 months ago told us that we need a significant amount of money in stocks to avoid being the victims of inflation. So, I guess I will have to sell a majority of my holding in stocks (after they have given up the year's gains) and buy bond's (at historic highs) and CD's ( at historic low interest rates.) I am so thankful for this advice.
__________________
The worst decisions are usually made in times of anger and impatience.
Chuckanut is online now   Reply With Quote
Old 08-15-2011, 12:54 PM   #5
Thinks s/he gets paid by the post
Brett_Cameron's Avatar
 
Join Date: May 2011
Location: South Eastern USA
Posts: 1,010
Quote:
Originally Posted by Chuckanut View Post
...
Well, I found the directions on how to build a time machine on the Internet. Build Your Own Time Machine: Science Channel ....
__________________
Brett_Cameron is offline   Reply With Quote
Old 08-15-2011, 01:50 PM   #6
Full time employment: Posting here.
Coolius's Avatar
 
Join Date: May 2010
Posts: 681
Quote:
Originally Posted by Chuckanut View Post
OK, so I read an article that tells us we should have already moved most of our money out of stock to more stable investments before this all started. GREAT! But, the article does not tell us how to build a time machine, NOT SO GREAT!

Well, I found the directions on how to build a time machine on the Internet. Build Your Own Time Machine: Science Channel

But, unfortunately, the author does not define the word 'most'. Is that over 50%, 60%, 80%?? We don't know. So I will define it myself to be 75%. The same source about 8 months ago told us that we need a significant amount of money in stocks to avoid being the victims of inflation. So, I guess I will have to sell a majority of my holding in stocks (after they have given up the year's gains) and buy bond's (at historic highs) and CD's ( at historic low interest rates.) I am so thankful for this advice.


Yes, the very best articles on investment are written with the full benefit of hindsight. I am sure it has never failed the authors.

I get kind of amused when I read Seeking Alpha; there are articles advising to buy a particular stock, followed by another article that says to dump it - sometimes both articles coming out on the same day.

I now look at sites like SA and Motley Fool, to determine what I should NOT do.
__________________

__________________
Coolius is online now   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Market Timing Strategy Earl E Retyre FIRE and Money 141 10-28-2011 03:09 PM
More Real Estate Fraud -- Short Sales chinaco FIRE and Money 34 07-19-2011 07:57 AM
In the long run young investors will be rich. clifp FIRE and Money 35 06-28-2011 09:09 PM

 

 
All times are GMT -6. The time now is 09:02 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.