How far will you ride the market down ?

You guys have nothing to worry about. Before it gets anywhere close to zero, the smart money will be back in. :)
 
MichaelB said:
If you think the market will be substantially higher in 5-7 years and can afford greater portfolio losses in the meantime, you should leave your money where it is, and if possible, prepare to increase your equity exposure as prices fall. That's my plan. As equity prices decline I'm buying.

Michael
Click to expand...
Pretty much describes me too. I am still buying although I have let our AA swing from 25 to 35%+ bonds without rebalancing. I am in it for the long term, but I am still working so I can keep working if need be. If I was retired now without pensions and/or healthcare - I don't think I could stomach this. And about 2/3rd of those retired here have pensions (many COLA'd) and some healthcare too. A completely different question for those folks...
 
I've gone tharn, for those of you familiar with Watership Down. Deer-in-the-headlights frozen. I'm not rebalancing, not looking at buying equities cheap, not even changing what I'm buying in my last month of accumulation.

Sometimes doing nothing is the best thing to do. Right now I'm just hoping it's less stupid than anything else.

Coach
 
But what if this really is the second great depression ? Are you willing to lose 90%?

Dow Jones decline rate mimics Great Depression | Business Tech - CNET News
Click to expand...
A line on a chart is just about the only thing in common with the ’29 depression.

The political, economic and monetary leadership around the world has made clear their purpose and commitment to stabilize the global financial system and vitalize the economies. They will have different levels of success, depending largely on their domestic political process and current economic well-being. That is, how much resource they have to dedicate and how well they make decisions.

IMHO, the country with the greatest probability of a positive outcome is the US.

We are net importers. That means less pain for manufacturers that must reduce output.
It also means greater opportunity for local manufacturers to step in when demand picks up again.

We have a political process that is open, transparent and subject to scrutiny. With all its shortcomings, it is still better than most of the rest of the democratic world. We can and are reacting.

We have the institutions and the very bright people needed to develop and analyze policy alternatives, then implement them.

We definitely have the resources.

A major depression is possible, but I would definitely bet that the leadership around the world are going to get their way. There may be more pain to come, a high price to pay, and the recovery may be slow, but I would not bet against these folks.




I'm pretty close to capitulation . This reminds me of being in a casino and thinking you'll get some of your losses back but you rarely do . So for me it's almost time to get out until sanity returns. I know some people have said they'll ride it down to zero but at what point do you say enough is enough .
Click to expand...
Enough is enough when you can’t afford to lose any more. Investing in equities is not betting. You are buying ownership. If you believe the companies in which you invest will survive, persevere and grow, you will have a positive return on your investment.
 
I'll be riding this to zero. And DCA'ing all the way down.

Of course by virtue of me admitting that it means I don't really think we are getting to zero.
 
Enough is enough

I have not been here awhile, because who can think of ER now? I am actually glad to have my job!

But the markets are not going to zero. That would mean that every company out there is worthless (WalMart, GE, Costco, IBM, whatever).
The only question is whether this is a V or a U or an L. Japan has pretty much been an L (fast down and then flat). I keep thinking the down is over and we will start to see the up, but who knows?

As some of the other posters have mentioned, there have been bad times before, and they ended. Is it really so different now? I call this a reverse bubble. Eventually it will burst and we will change direction (just like an upward bubble). I think it is like a hitter in baseball. You never are really as good as you are during a hot streak or as bad as you are during a cold one. Let's hope so.:)
 
Enough is Enough. I got out today. I just can not see anything in the next few months to turn this around. I may be wrong. If I am I will be back in, but this time feels different. Time will tell.

Lyle
 
I am still 100% equities, and plan to stay that way. Dividends - which provide all of my retirement income - are up and seem safe unless the economy gets much worse. Earnings are up - not for every stock I own, but the composite is. Overall, I am not too worried at this point. If a couple of dividends are cut, I can cut spending to match, but at this point I do not expect to.
 
Hello from Tarma, Peru

haha said:
Welcome Scott. Good job to only lose 20%!

Are you missionaries? Tell us a little about your environment?

Ha
Click to expand...

Hi Ha,

Thanks for asking. Thanks for the welcome, but I was a frequent contributor leading up to my departure from the US last October. Don't know why my number of posts got reset to zero.

Yes, my wife and I are missionaries. We live in the town of Tarma, at 10,016 feet above sea level, almost due west of Lima. We live in a relatively large (rented) home, about the only home in the high Andes with hot running water. The rent is $400/mo, which is extremely high for this town, but the home is fully furnished. Food here is so cheap I keep telling my wife that to a first approximation, it's free. (20 lb of potatoes for US$0.33; 8-10 fresh rolls for US$0.33; etc.) Also, we can take a mototaxi from one end of town to the other for US$0.50. My wife says we need to stay here until the stock market gets back up. We shall see.

Scott
 
I started at 50/50 AA in 2007. Chicken feathers...bluck Bluck BLUCK.
AA migrated on its own to 45/55 due to 2008 mess.
I just actively did a very minor exchange (didya hear the Psst...Wellesley siren go off?) to intentionally position myself at 40/60 for all of 2009 and most probably for all of 2010. Now I let the soup simmer.
It's not timing. I like to call it proactive damage control.
Other than that, I'm in for the long haul. I must love pain. :whistle:
 
ScottFromUtah said:
Hi Ha,

Thanks for asking. Thanks for the welcome, but I was a frequent contributor leading up to my departure from the US last October. Don't know why my number of posts got reset to zero.

Yes, my wife and I are missionaries. We live in the town of Tarma, at 10,016 feet above sea level, almost due west of Lima.
Click to expand...


Welcome again , My sister is a nun and her order has convents in Lima .
 
DW and I had the capitulation discussion last weekend. We're staying in.
We might be wrong but we realize that the only way that we can get our totals back up is to remain in equities as we are now. We are still DCAing and believe that we are buying low.

We are fortunate that we have a pension to fall back on so my comments are in some respects, "disqualified" in this discussion.

Pension or not, this is definitely going to affect our retirement. How much, remains to be seen. It is disturbing to see a good part of your savings evaporating on a daily basis but we are so far down now that the only thing to do is to stay in. We're hopeful and believe that it will come back.

This market is so crazy that I predict there will be some 1000 point upswings in a single day, so how many of those does it take before you get back in?
I don't know that answer.
 
CyclingInvestor said:
I am still 100% equities, and plan to stay that way. Dividends - which provide all of my retirement income - are up and seem safe unless the economy gets much worse. Earnings are up - not for every stock I own, but the composite is. Overall, I am not too worried at this point. If a couple of dividends are cut, I can cut spending to match, but at this point I do not expect to.
Click to expand...

I need some of your meds. ;)
 
I'm DCAing my bi-weekly contributions as always. Easy for me to say since I'm still wo*king. No plans to sell now. This past year has definitely caused me to think about the importance of nest egg preservation as I get closer to FIRE. Not to mention staying on the job a few extra years.:(
 
I was just noodling this over. There was a piece by one of the talking heads explaining that we are down from the fall of 2007 by 52%. I took my current balance and divided it by 48 then multiplied it by 100. The figure I came up with is several hundred K above my all time high. So, I will stay in and keep working it to mitigate the losses. Although I am debating cashing out a good portion and buying something like QQQQ anytime there is a 2 or 3% drop and then turning it back within a few days. I also intentionally did not include my distributions which I am living on now.

The accounts still have enough to take me through my life expectancy at a decent level. In 6 to 8 years I may be eligible for SS and can reduce my draw down then if need be. The home can be downsized for additional funds if needed as well. I have options and feel fortunate. This last 6 months we have seen wide swings in our balances. I want to be in to enjoy some of the upswings ahead of us.

And, if all else fails we can open a commune and plant a big garden again!
 
I don't have any idea when this will end or where the bottom is. But I just keep picturing a big V shaped market and hope we will get to the upper right of this thing some day soon. Realistically it may be 4 or 5 years in the future and I'll just have to be patient.

P.S. I enjoyed listening to HFWR's link to Jeff Beck music while reading some of the comments here.
 
I'm still in, and don't plan to get out. I have a pile of fresh money coming (bonus) that will go mostly to muni bonds but some will be piled into deeply discounted stocks. Just bought AA today, and if GE goes down to say $6-6.50 I'll be buying a pile to bring my average cost into line. The thing is that the market prices of so many of these companies are way below tangible equity value. The market price of AA for example is about 50% of tangible equity...crazy prices. Analysts think they will turn a profit in Q1, and we know that Dawg's meds most often come in aluminium cans....so that right there means they'll turn a profit, right?

Anyway, I'm hanging in, and if the dow/S&P continue to go down, I'll keep buying. When they start going back up I'll return to buying bonds when I end up with more than 50% in equities. At the end of the day, I also keep about 3 years of barebones cash on hand, and I'm still w*rking.

R
 
I'm starting to wonder if maybe herd mentality with regard to investing is actually the right way to do it. What was the heard doing in 98-00' - buying like mad and in internet stock of course, and even in 1-2 years they doubled their money. If the herd then soon panicked into 2000 and they panicked within a month or two, they missed most of the drop that continued through the end of 02' and sold much sooner than I did (which was never).

I would think more recently "the herd" got spooked a LONG time ago, and has had their money sitting in savings accounts and CDs for some time now. Surely, those still owning stocks by now could only be those people who think they know what they're doing despite mass hysteria on an almost daily basis. Yeah, I'm one of these people who actually went from half to almost 100% stock the past year, but I'm wondering if the jokes' been on me all the time, and that herd is giving me a funny look.

Maybe the best timing is to see what looks to be a trend, time test it a couple of months, then react, not worrying about missing the exact top or bottom.
 
Free To Canoe said:
Leave it to HFWR to come up with some good music.

Been awhile since I heard some Jeff Beck.

Thanks!

Free to Canoe
Click to expand...

Check out the Crossroads Guitar Festival Concerts with Eric Clapton and friends. Beck is amazing today, just amazing.

-ERD50
 
You must log in or register to reply here.

Similar threads

A
Is the IRS intentionally this obtuse???
2
Replies
30
Views
3K
indiajust
I
D
Sold Position - How to send the IRS a check?
Replies
9
Views
789
Sunset
Sunset
Y
How to decide if you can live off investments or need to draw them down
2 3 4
Replies
93
Views
8K
pb4uski
pb4uski
Earl E Retyre
I am a secondary market brokered CD convert
2
Replies
35
Views
2K
hpnutty
hpnutty
T
How to approach FIRE projections - llc owner, ACA ins & IDR student loans?
Replies
0
Views
211
tpac
T

Latest posts

Back
Top Bottom