Fear and Greed !

[frayne]

Purely a speculative post. The bull has been running strong for nine years. How much longer will the bovine hold up at this current pace ?

I for one am totally clueless but it is fun to watch people who have never seen a serious downturn be so enthusiastic concerning the market today. I'm afraid when the party is over there may be some serious hurt going around.

Heard some friends in their 60 & 70s with 80% in equites bragging about their returns last years and just thought to myself, oh my, my.

 

[Senator]

The tax cuts were a game changer and a large profit increase for many companies. It will run for a while yet.

 

[foxfirev5]

I was doing my first Roth conversion for this year. DW looking over my shoulder (who claims she has no idea about finances) stated that an upgrade in hotels for our vacation is in order. Lucky for me it was her IRA account. I have no idea how much longer this will last. However as long as the diveys and interest cover it I'm OK.

 

[Free bird]

Greed Trumps fear. Fear is a losers game.

 

[RobbieB]

I have seen lots of serious downturns and I'm enthusiastic about the market today.

Age 62 and 75% in equities.

 

[gerntz]

I continue to gradually increase equities percentage as I age. Staying the course trumps fear.

 

[CRLLS]

The bull has been running strong for nine years. How much longer will the bovine hold up at this current pace ?

I look at it just like flipping a coin. The chances of the market tanking in 2018 is the same as it was 9 years ago. I see no evidence that any given year is related to the previous one. I set my course and I stay the course. I'm 65 and 75% equities. Would brag about last years returns? Sure. Would I bitch if we had a major correction? Absolutely. I'm human. Would I change my plan because I was afraid of losing some money? Not a chance!

If I listened to some of the pundits, I would have been out of the market 2 years ago. Where would that have put me?

Now, adjusting AA for age is a different story. Even though I am 65, I still are planning for >30 years out. Not ready to change AA just yet. But someday.....

 

[Palmtree]

I'm thrilled with the long bull run but with the length and height of the current good times, it's getting dizzy up here. CAPE 10 is pushed way outside the comfort levels and it keeps getting stretched out more. I don't know when the party will be over but I do know that the market is cyclical and there will be a return to mean at some point. I'm trying to mentally brace myself for the eventual market correction. I know it's coming, I just don't know when. I have a 60/40 AA but when it does correct, I know it's still going to hurt.

 

[street]

I look at it just like flipping a coin. The chances of the market tanking in 2018 is the same as it was 9 years ago. I see no evidence that any given year is related to the previous one. I set my course and I stay the course. I'm 65 and 75% equities. Would brag about last years returns? Sure. Would I bitch if we had a major correction? Absolutely. I'm human. Would I change my plan because I was afraid of losing some money? Not a chance!

If I listened to some of the pundits, I would have been out of the market 2 years ago. Where would that have put me?

Now, adjusting AA for age is a different story. Even though I am 65, I still are planning for >30 years out. Not ready to change AA just yet. But someday.....

My thinking is like yours. My AA is the same as yours and don't plan to change and will ride out the storm when it happens.

 

[bw5972]

Most likely investors in their 60s & 70s HAVE seen serious downturns. Many of the people in their 20s and 30s I hear from are not in the market because it is "rigged" or a just a dangerous gamble. There is a middle ground between outright fear and irrational exuberance. Most on this site walk that balance well.

 

[jazz4cash]

I'd actually feel better if the market took a breather, say after a 5-10% from current levels with no major changes to fundamentals. Otherwise, I'm comfortable.

 

[braumeister]

The tax cuts were a game changer and a large profit increase for many companies. It will run for a while yet.

Yeah, I think that pretty well sums it up. Don't take your chips off the table yet, just keep watching until you see a trend develop.

 

[aja8888]

The Market.......

Dilley Dilley!

 

[UnrealizedPotential]

Have we reached irrational exuberance yet? My feeling is not yet, but it's getting closer. Since all I can do is guess, I would say the closer we get to 3 on the 10 year , the more dangerous it is for the stock market. Still with the tax cuts, that provides some more fuel but I am still leery. Interest rates rising too high to me is the biggest known risk .

What I fear is the Fed will have to jack up rates too fast and the market can't handle it. This of course is not the only risk in the market, there are many, but this risk I can clearly see. But right now the stock market is alive and well.

 

[donheff]

The financial press is saying that small investors are crowding into equities in the last few days. Sounds like it's time for anther round of irrational exuberance that will take us higher and higher. As always, you can't see where the end will come. It always seems to be sudden and steep so you can jump out in advance. Despite my irrational exuberance I plan to rebalance down to my 60/40 AA frequently if we keep going up.

 

[gcgang]

I'm fearful of others' greed.

 

[braumeister]

I have always appreciated the wisdom of Bernard Baruch.

When asked how he got so wealthy, his answer was "I always sold too soon."

 

[flyingaway]

I will do rebalance to maintain 70/30 or lower equities. No need to play hard when I have won the game. Of course, I am playing for the long run (not out pf the market).

 

[Chuckanut]

One theory says that with the tax-cuts most companies get an immediate bump in earnings that will drive the P/E ratio into more normal territory, thus giving room for more price gains.

Maybe. Maybe not.

 

[bobandsherry]

One looks at this market as running out of fuel, but ignore that with tax cuts and other changes in regulations new fuel as been tossed on the fire. Sure it can crash, but it can also go up. And is there anything that would prevent this from just going sideways for a period of time? To the best of my knowledge there has never been a period in US history that is even similar to the financial and economic environment we are today.

There are been those here who have called for market correction almost every year since the market rebounded. There are also "experts" who have done the same. Say it often enough and eventually you'll be right. For me, I'm sticking with my disciplines that have left money on the table in the past few years and hopefully prevent me from crashing and burning should times get tough. Get a plan, stick to the plan, don't panic, get rewarded.

 

[KenZ71]

I'll admit I've been spooked. Between China rattling sabers about being our banker which is factual. Inflation going up. And just because the ballon can only expand so much.

For the past 18 to 24 months or more I've been about 80% in leveraged ETFs which worked quite well. So now I'm rebalancing in to REITs, oil majors & some emerging markets.

Also have some stop loss orders to trim the leveraged ETFs further if / when the bottom falls out. Worst case they trigger too so then I will be where traditional allocation says. Best case I get more joy on the irrational exuberance train.

 

[gayl]

60s but pensioned out. IMHO it's wrong to lump people together by age whether discussing AA, fear, or greed. FWIW: 92% stock / 8% cash & bonds primarily and I sleep well @ night

 

[bobandsherry]

I have always appreciated the wisdom of Bernard Baruch.

When asked how he got so wealthy, his answer was "I always sold too soon."

And then there's Warren Buffett who's taken a different course, that being buy long and stay the course. I think he's done pretty good as well.

 

[W2R]

Purely a speculative post. The bull has been running strong for nine years. How much longer will the bovine hold up at this current pace ?

I for one am totally clueless but it is fun to watch people who have never seen a serious downturn be so enthusiastic concerning the market today. I'm afraid when the party is over there may be some serious hurt going around.

Heard some friends in their 60 & 70s with 80% in equites bragging about their returns last years and just thought to myself, oh my, my.

I think it's (hilarious? crazy? inexplicable?) that people can be so grim and expect doom at any minute, no matter what the market conditions. Up market? The crash is imminent. Down market? This time it's different, it will never recover.

And yet, people cannot ever be happy and optimistic about the market? Pffft.

Allowing yourself to be happy when good fortune comes your way, is part of being a human being and living a fulfilling life. Well, IMO anyway. Just something to consider. Sound investment decisions are not based on emotion anyway, so feeling happy does no harm to anyone.

 

[RobbieB]

I've always liked you. Yeah, why not be happy and spend freely in this time of abundance?