Going to 100% cash

[NW-Bound]

I have not posted for a while. Been RVin', ya know, and where we've been staying most of the time, there's no Internet, no cell phone signals.

And when I do get Internet access, I am just too tired at the end of the day to surf much. Too busy with travelin', hikin', sight seein'...

Right now, I just happen to be at a public library in a small Californian town to check my portfolio. Compared to its value on 8/23 when this thread started, I am doing quite OK. Though I am opposite Dex on our recent trades, I respect his opinion and action. "You pay your money, and you take your chances".

And by the way, at a National Park RV campground in Utah, I saw a man with a Casita and I though of Dex. No, I observed but did not ask him :-) Well, it could be him, and I would also have to reveal myself

Will have to log off soon to resume what we have been doin'... Life is still good... Just a quick post to let everyone knows I am still alive and kickin'...

[Zathras]

Quote:

Originally Posted by Martha I give Dex credit for saying what he was doing when he did it and why. I appreciate that far more than the people who come here and say months after the fact that they sold at the near term high or bought at the near term low. Even if that is all true, you don't get many who are willing to say they bought at the high and sold at the low. I thank Dex for taking a risk before a tough audience.

+1

Very much agree.

[dex]

It appears there are a lot of market timers here. This is a slo motion asset re-allocation. As everyone knows I do not time the market (speak with audreyh1 about that).

I have no problem posting what I do financially and how my net worth has performed. It might help those thinking about ER. The past few years have been challenging for investors. And if my net worth (excluding home) is down 1% from 2006 - I think I'm doing OK.

I too think it was gauche for some to post at the low of the market that they were glad they got out earlier. Comments like that reveal more about the poster than what I am doing.

Quote:

Originally Posted by dex Mentally, I am prepared to be in cash until the end of the year. I'll be watching along the way for an entry point. My weighting would be heavier in High Yield Corp bonds than stocks - if any. This would provide me with a good interest rate and some appreciation if there is a rally. There may be rallies in the future but they will have lower highs and of shorter duration than the recent one.

[REWahoo]

Quote:

Originally Posted by dex This is a slo motion asset re-allocation. As everyone knows I do not time the market ...

OFGS!

Dex, I love your sense of humor.

[BigNick]

Quote:

Originally Posted by haha [COLOR=black][FONT=Arial] We end with a word about momentum. This month was the best September for the market since 1939, when the Dow was up 11.1%. Yet, the market dropped 30% by June 1940 and 41% by April 1942. The September 1939 top was not reached again until June 1949, almost ten years later. The market was also up 9.7% in March 2000, before dropping more than 50% over the next 2 ½ years. Momentum can and sometimes does turn on a dime, particularly when not supported by fundamentals.

Yeah, you never know when the Germans will invade France and the Japanese will take Singapore.

[TromboneAl]

Quote:

Originally Posted by samclem I guess if T-Al hadn't put the smiley-thang in, and if the timing weren't quite so amazing, and if dex hadn't already proven that he's eager to engage in the to-and-fro of the board, and if dex's arguments in favor of market timing weren't so adamant, then maybe I'd take exception to T-Al's comment. Anyway, dex may get the last laugh when the timescale of that chart has a chance to expand a bit, and he'll get to recall T-Al's post with glee.

Right. I hesitated to post that, and hoped the that smiley would indicate the good-natured ribbing that was intended.

I also think that a time-frame of one month isn't enough to prove dex's move right or wrong.

[Gone4Good]

Quote:

Originally Posted by shotgunner The lesson I take away from this is that none of us can predict the future with any great degree of accuracy.

The lesson I take away is that the human mind has a remarkable capacity to see patterns in randomness (have you ever looked at the constellations?). Technical analysis is no different.

[ERD50]

Quote:

Originally Posted by TromboneAl Right. I hesitated to post that, and hoped the that smiley would indicate the good-natured ribbing that was intended. I also think that a time-frame of one month isn't enough to prove dex's move right or wrong.

That's how I see it too. And I would expected dex to chuckle at the joke too. He was bold and brave enough to lay it out there, he knows this crowd, he has to expect a little joking/push-back. And the timing was an eerie co-incidence (or maybe not?). I don't think any explanation is needed T-Al, but that's just me.

Anyhow, I'm glad to see that dex posted the OP, and glad to see the responses. It gets me thinking, and that's good. I guess I'd say that I am, in my heart, a dirty market timer (two Hail Marys and an Our Father?) I don't think I'm alone, and I also don't think I'm alone in admitting that at this stage, I just don't trust my instincts enough to risk doing anything like a 100% of anything. But... (and I'm also a contrarian, economically and otherwise ), so this fast run up really does have me thinking about checking to see if a re-balance is on order, or even taking a degree of market timing, and adjusting my AA to a bit more conservative level (I'm pretty aggressive, ~ 75% now), but nothing drastic.

It's all good, that's what I say.

-ERD50

[clifp]

I am dirty market timer also and a stock picker, option seller and am I guilty of other financial high crimes and misdemeanors. In truth I am not happy if I am not thinking about buying or selling something.


The things that keeps me out of trouble is that only buy and sell about 1/3 of the time that I think about it. And all of my wheeling and dealings only affect about 1/3 of my total portfolio. Meaning basically I have a slightly larger testosterone than Uncle Mick

[bbbamI]

Quote:

Originally Posted by NW-Bound I have not posted for a while. Been RVin', ya know, and where we've been staying most of the time, there's no Internet, no cell phone signals.

Ye gawds man...how have you been survivin'.......

Quote:

Originally Posted by NW-Bound Will have to log off soon to resume what we have been doin'... Life is still good... Just a quick post to let everyone knows I am still alive and kickin'...

Y'all be safe and have a good time.

[haha]

Quote:

Originally Posted by REWahoo I give dex high marks for courage and certainly hold his actions far above the after-the-fact "I told you so" types. However, I think anyone who posts here about their attempt to time the market should expect criticism or praise once the results of their gamble strategy plays out. Simple human nature.

As best I can tell, Dex is engaged in strategic market timing, or variable allocation. As I understand his techniques, he gets out when he perceives risk to be high.

The fact that one month later he is not ahead of where he would be if he had not sold IMO is meaningless. People confuse a plan to over time beat the market on a risk adjusted basis with a plan to always, every week and every month and every year beat the market. No one has done the latter as far as I know, but plenty people have done the former, whatever apostles of failure might say about it.

And no, I am not interested in debating this question. Differences of opinion are good, I don't want to change anyone's opinions, and I won't pay any attention to anyone who might attempt to change mine.

Ha

[Purron]

Quote:

Originally Posted by haha Differences of opinion are good, I don't want to change anyone's opinions, and I won't pay any attention to anyone who might attempt to change mine. Ha

Agree. And I'd never try to change your opinion

[easysurfer]

Quote:

Originally Posted by shotgunner The lesson I take away from this is that none of us can predict the future with any great degree of accuracy. It is easy to become fearful and it's just as easy to get greedy. I have no idea what the future holds so I will continue to keep a portfolio with a mix of equities and fixed income and try to keep it balanced while ensuring I have several years of "guaranteed" monies.

That's why I believe that things aren't as black and white as all-or-none (0 or 100%). Everything in moderation. Sometimes, balanced, boring, middle of the road isn't too bad

[harley]

Quote:

Originally Posted by TromboneAl Right. I hesitated to post that, and hoped the that smiley would indicate the good-natured ribbing that was intended. I also think that a time-frame of one month isn't enough to prove dex's move right or wrong.

I tend to agree with Dex on this particular issue, although he's bolder than I am.

That said, the chart and comment were pretty funny.

[ERD50]

Quote:

Originally Posted by haha No one has done the latter as far as I know, but plenty people have done the former, whatever apostles of failure might say about it. Ha

"apostles of failure" - wow, that's a good one, haha! Google search comes up with only 40 hits, most of those duplicates of three or four refs.

Gotta tuck that away for the proper moment... apostles of failure, apostles of failure, apostles of failure - got it - Thanks!

-ERD50

[Dawg52]

Quote:

Originally Posted by ERD50 All well and good, but... inflation? -ERD50

As long as I can keep the med's coming in.........I'm happy. FIRECalc says I have it covered.

[REWahoo]

Quote:

Originally Posted by haha And no, I am not interested in debating this question. Differences of opinion are good, I don't want to change anyone's opinions, and I won't pay any attention to anyone who might attempt to change mine.

Ha, you need one of those "write only" computers...

[traineeinvestor]

Quote:

Originally Posted by Gone4Good The lesson I take away is that the human mind has a remarkable capacity to see patterns in randomness (have you ever looked at the constellations?). Technical analysis is no different.

"Chaos is not dangerous until it begins to look orderly" - Max Gunther.

[Moemg]

Quote:

Originally Posted by Martha you don't get many who are willing to say they bought at the high and sold at the low.

Have you seen my vanguard trades ?

[shotgunner]

FWIW I can relate to Dex.

In early January 2000 I went with my gut feeling and sold all my equity positions and went to 100% cash. Some of the factors I considered important to my decision were really not factors in what happened to the market that year. During February and early March I was not feeling all that great about what I did. Then the March 2000 crash came. I continued to stay out of the equity's market and then 9/11/2001 happened. I stayed in fixed income accounts until Aug 2003.

Sad to say in the Apr 2008 - Aug 2008 I had the same urge, to get out. It seemed to me that with the Fed raising interest rates and oil at $147 a barrel two BIG brakes were being applied to the economy. Seemed simple enough to me. I moved some money out of equities, about 10% and decided against moving more because of cap gain taxes . Then Sep '08 - Feb '09 came and I was feeling pretty stupid for not following my gut once again.

I don't know which is worse getting burned when one does not follow their gut feeling or getting burned because you do. Both scenarios have a "what if" regret component.

I am think finally coming to terms with keeping at least 5 years of guaranteed money to live on and maintain a portfolio mixed with equities and fixed income and stop worrying (I am working on the latter).

For me it's been hard not to worry some nights especially since the meltdown in '08. FIRECALC has said all along I am good. My FA says I am good. Sometimes it's hard to believe that. I'd probably do better if I avoided watching cable tv, especially CNBC. I hope it does not hurt anyone's feelings but sometimes I think I should limit my visits here when times are bad or markets anxious. Some threads here are informative for sure, others can needlessly fuel anxiety.

ER can be tricky trying to balance not running out of money before one runs out of life and yet try to enjooy one's money as much as possible before checking out. Even a mixed or balanced portfolio requires some faith. I don't know about anyone else here but the last two years of really tested my faith. I am still OK yet still a bit nervous. ER'ing in spring 2008 was it seems setting out on a voyage around the world only to run into a hurricane a few miles off shore. My ship is bit battered, the crew is fine, but the crew is jumpy about being hit with a rogue wave. It would be easy to get more nervous than greedy and try market timing again. I keep looking at FIRECalc and fight the urge.

Dex what does FIRECalc say about your 100% cash position vs. expected/needed longevity?

PS. I ended up taking a long nap today on a rainy afternoon, I am paying for it now.