Join Early Retirement Today
Reply
 
Thread Tools Display Modes
Old 11-15-2008, 12:32 PM   #101
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2006
Posts: 11,401
Quote:
Originally Posted by Ronstar View Post
I'm not bailing out - I'm planning to live off my salary while I'm still working (3 years), then cash for 4 years, then proceeds from real estate investments for 3 years, until my equities reach an all time high (hopefully in 10 years or so), and then start tapping them.
For those of us still working, it's important to keep this long term perspective. In my own case, my target RE date is/was 2013. This meltdown has been an important reminder to build liquidity, which I will do with future earnings. I'm currently low on cash so I am compromizing by reducing DCA to $2500 per month in dividend stocks and accumulating the remainder of my (tax deferred) savings in cash. At some point I may build a bond ladder with some of that. If I can maintain my current earning power and LBYM status, by 2013 I should have accumulated sufficient cash to carry me and the taxman/woman for another 4-5 years. One would certainly hope that markets would have improved 9-10 years from now. Otherwise we might just as well go live in a cave.

Friends are not forthcoming with detailed information. Thus far I'm not aware of anyone who has baled out of the markets, but many people have said they have stopped looking at their funds. People who have planned retirement dates in the near future appear to be sticking with their plans.
Meadbh is offline   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 11-15-2008, 01:19 PM   #102
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,983
Quote:
Originally Posted by FIREdreamer View Post
Sigh... how long can I hold on to my faith in the market and the economy? I might have to unplug the phone, the TV and the internet for a while...
I feel that markets are not really a place for faith. But there is room for analysis.

Except for 1929-'32, the biggest declines in the Dow or S&P were about 50%, peak to trough. Most bear markets were much shallower. The 50%-ers bottomed in 2002/03, and 1974. In 1999/2000, valuations were unusually high, even for a market peak. 1974 is less clear. The peak in January 1973 had many stocks at very high PEs (Nifty Fifty), but overall was perhaps not very different from the recent 2007 peak.

On 10/10/2008 the Dow made an intraday low of 7774, a 48% fall from last October's peak.

Now 50% is not written in stone, but as we can see, we are spitting distance from the twin minimum bear market troughs of 1974 and 2002. One always needs to remember that the past is not the future, but the odds would seem to favor the proposition that the Dow is very close to a low. Very strange is that there have been no meaningful rallies in this trip down.

Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is offline   Reply With Quote
Old 11-15-2008, 03:23 PM   #103
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Dawg52's Avatar
 
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 9,067
Quote:
Originally Posted by haha View Post
Very strange is that there have been no meaningful rallies in this trip down.

Ha
Maybe this time it truly is different.
__________________
Retired 3/31/2007@52
Investing style: Full time wuss.
Dawg52 is offline   Reply With Quote
Old 11-15-2008, 03:29 PM   #104
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,000
Quote:
Originally Posted by Dawg54 View Post
Maybe this time it truly is different.
I'll drink to because of that...
__________________
Numbers is hard
REWahoo is offline   Reply With Quote
Old 11-15-2008, 03:39 PM   #105
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 8,797
A glimmer of hope: stopped by the library yesterday and the Nov 7th issues of Value Line had their estimate of median stock performance (their analyzed stocks) for the next 3 to 5 years of 160%. In July 07 it was only 35%. At the Oct 2002 low that number was something like 100%.

I could even live with half of this estimate since 80% means 12.5% compounded return for 5 years. If it returned 120% we are talking about 17.1% CAGR for 5 years.

Things could get better -- really .
Lsbcal is offline   Reply With Quote
Old 11-15-2008, 08:35 PM   #106
Recycles dryer sheets
Gardnr's Avatar
 
Join Date: Jul 2008
Location: ENE MO - near STL
Posts: 424
Quote:
Originally Posted by haha View Post
I feel that markets are not really a place for faith. But there is room for analysis.

Except for 1929-'32, the biggest declines in the Dow or S&P were about 50%, peak to trough. Most bear markets were much shallower. The 50%-ers bottomed in 2002/03, and 1974. In 1999/2000, valuations were unusually high, even for a market peak. 1974 is less clear. The peak in January 1973 had many stocks at very high PEs (Nifty Fifty), but overall was perhaps not very different from the recent 2007 peak.

On 10/10/2008 the Dow made an intraday low of 7774, a 48% fall from last October's peak.

Now 50% is not written in stone, but as we can see, we are spitting distance from the twin minimum bear market troughs of 1974 and 2002. One always needs to remember that the past is not the future, but the odds would seem to favor the proposition that the Dow is very close to a low. Very strange is that there have been no meaningful rallies in this trip down.

Ha
Yep, I agree. As a matter of fact I wouldn't be surprised to see a '74 scenario play out, as I think there's been an overreaction on the downside caused by the forced selling and panic/fear. That would mean a very quick upturn to recover a good bit of the loss from the high and then a sideways market for a few years bringing valuations down to historical lows, and then a big bull. Time will tell if I'm right or not but I'm betting on it by buying in with everything I can throw at the market over the next few months. It may be the only chance to get some big gains for quite some time.
Gardnr is offline   Reply With Quote
Old 11-15-2008, 09:08 PM   #107
Thinks s/he gets paid by the post
Bikerdude's Avatar
 
Join Date: Jul 2006
Posts: 1,901
Quote:
Originally Posted by novaman View Post
Yep- Had a guy just tell me earlier this week that after the Dot Com bubble burst on him and wiped at over 40% of his portfolio, he abandoned the buy and hold strategy this time around and jumped ship at the beginning of October. Went all into cash

Probably means he sold on Oct 10th, close to the current low. Time will tell if it was a smart choice short term. Long term he will have to buy in at the right time to be successful.
__________________
“I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said” Alan Greenspan
Bikerdude is offline   Reply With Quote
Old 11-16-2008, 07:29 AM   #108
Thinks s/he gets paid by the post
redduck's Avatar
 
Join Date: Mar 2005
Location: yonder
Posts: 2,851
Well, if you are looking for someone who might help bring the bottom about, here I am...sort of. I've sold off a bunch of my equities in the last three weeks (I'm thinkin' "way too late"). OK, maybe not a smart thing to do, but that's what I did. So, I'm about 1/3 cash; 1/3 bonds; 1/3 equities. And, since I'm still w*rking, I have also bought Sysco, United Tech, and added to Nucor. I used to be a buy-and-holder, but I think times have changed (at least for now). And, this time it does feel different (and, I hope I'm wrong about this). In 2002, I was OK with the market, but, not OK with this one.
redduck is offline   Reply With Quote
Old 11-16-2008, 07:41 AM   #109
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Dawg52's Avatar
 
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 9,067
Quote:
Originally Posted by redduck View Post
Well, if you are looking for someone who might help bring the bottom about, here I am...sort of. I've sold off a bunch of my equities in the last three weeks (I'm thinkin' "way too late"). OK, maybe not a smart thing to do, but that's what I did. So, I'm about 1/3 cash; 1/3 bonds; 1/3 equities. And, since I'm still w*rking, I have also bought Sysco, United Tech, and added to Nucor. I used to be a buy-and-holder, but I think times have changed (at least for now). And, this time it does feel different (and, I hope I'm wrong about this). In 2002, I was OK with the market, but, not OK with this one.
Probably smart. I'm still holding so the market will never recover as long as I own stocks. 'The Born Loser' syndrome. My bullies lost last night as expected. They will always be a loser too.
__________________
Retired 3/31/2007@52
Investing style: Full time wuss.
Dawg52 is offline   Reply With Quote
Old 11-16-2008, 11:54 PM   #110
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 35,712
Granted, the economy outlook is pretty bad, and the stock market is discounting that. But how about "deleveraging" by investors?

According to the following article in the recent BusinessWeek, hedge funds borrowed $6 for every $1 that they had. Then, funds of funds leveraged another $1 for $1. Investors in funds of funds leveraged some more. All these layers of borrowing are collapsing now. I will hold off buying for a while to see if all these margin calls have been met.

By the way, the article mentioned that funds of funds held $747 billion as of last year. Unbelievable huge amount of money!

Fall of the Funds of Funds - BusinessWeek
NW-Bound is offline   Reply With Quote
Old 11-17-2008, 07:15 AM   #111
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Dawg52's Avatar
 
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 9,067
Well I didn't even look at my Fidelity account over the weekend. Not going to for a while. My head is a little sore from all the head banging so going to give it a rest. Time for a quick shower and then make some money the only way I know how, through work. Got plenty of it for now.
__________________
Retired 3/31/2007@52
Investing style: Full time wuss.
Dawg52 is offline   Reply With Quote
Old 11-17-2008, 07:28 AM   #112
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
harley's Avatar
 
Join Date: May 2008
Location: No fixed abode
Posts: 8,764
Quote:
Originally Posted by Dawg54 View Post
Well I didn't even look at my Fidelity account over the weekend. Not going to for a while. My head is a little sore from all the head banging so going to give it a rest. Time for a quick shower and then make some money the only way I know how, through work. Got plenty of it for now.
OK, who are you and what did you do with the Born Loser?

Much better way to deal with it all. A tiny bit of positive thinking can go a long way. Go make money.
__________________
"Good judgment comes from experience. Experience comes from bad judgement." - Anonymous (not Will Rogers or Sam Clemens)
DW and I - FIREd at 50 (7/06), living off assets
harley is offline   Reply With Quote
Old 11-17-2008, 09:29 AM   #113
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Dawg52's Avatar
 
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 9,067
Quote:
Originally Posted by harley View Post
OK, who are you and what did you do with the Born Loser?

Much better way to deal with it all. A tiny bit of positive thinking can go a long way. Go make money.
Hey, I've perked up even more. Such a pretty day I'm headed to the golf course after lunch. I'll work tonight.
__________________
Retired 3/31/2007@52
Investing style: Full time wuss.
Dawg52 is offline   Reply With Quote
Reply


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


» Quick Links

 
All times are GMT -6. The time now is 05:01 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2024, vBulletin Solutions, Inc.