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Old 11-11-2007, 11:10 PM   #21
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Because the Asian/Australian markets are open ahead of us it looks like a down day 11/12. Doesn't bode well or our opening tomorrow.

Stocks will fluctuate but I don't see an up trend-line in the next couple months. Save a little cash to pick up good stocks.
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Old 11-11-2007, 11:38 PM   #22
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I entered a contest last December and I picked DOW 12,900 for YE. Sadly I am getting more correct every day. maybe even optimistic! When it was over 14k, my peers thought I was a pessimist.
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Old 11-12-2007, 02:09 AM   #23
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After consulting the oracle, throwing the bones, reading the tea leaves, and extensively calculating the relative positions of the sun, moon and stars, (also taking into account, of course, the prophecies of Nostrodamus)
You do that too? And here I was thinking that I am the only one...

Sometimes it's nice to feel a little less alone in this crazy world
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Old 11-12-2007, 02:13 AM   #24
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As I read the DJI chart, it is still in an uptrend, with higher highs and lower lows. It wold take a close below about 12,500, or a filure to best about 14,200 on the next upswing. So, the DJI at least is still trending upward and not a lot can be said about what might happen from a technical POV.

Not that technical POV necessarily matters.

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Old 11-12-2007, 08:37 AM   #25
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Their are some indications of a economic slow down - not a recession. Companies are beginning to project lower 2008 earnings, indicating that they see their growth in revenue shrinking. This may also be related the price of fuel. Living thru several recessions and the stagflation period in the 70's the one component that struck me was high un-employment. We are as close to full-employment as you can get. When people have jobs they spend. I believe that the banking industry has another year or two to filter out their bad debt and that will be a drag on the financial sector in 2008. The good thing is that many of the lenders have announced their exposure - allowing for the impact to be priced into their stock price. If you look at the dollar value dropping - It can be viewed as an economic boost. Instead of money leaving the US it will be coming in - especially in the housing market - which started this mess.

I keep holding to my portfolio allocation of 40/40/20 to help keep my sanity. The 20 is 4-5 years of living expenses which reduces my need to take knee jerk reactions. I have stopped listening to the news casts as one day everything is rosy and the next its in the toilet - reminding me that news is not advise but noise to sell advertisement!

Every time I get a little nervous I read my Early Retirement books re-visit my holdings and gain re-assurance.

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The hidden economy
Old 11-12-2007, 11:35 AM   #26
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The hidden economy

For all those who go ballistic with the number of undocumented from Mexico, in the west a large percentage work home construction. When home construction tanks they don't file for unemployment so they don't show up in the statistics. Remittances to Mexico have fallen significantly.

Consider the possibility that these undocumented workers live largely a subsistence life in the US because they are supporting families in Mexico, their situation has little impact on non-food retail sales. The larger economic impact is in Mexico.

I think the level of unemployment is higher than reported, but so long as the economic adjustment is largely limited to home construction it will have little impact.
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Old 11-12-2007, 11:45 AM   #27
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I read the title to this thread, so I have to go check for myself to see if the "Dow is way down" ....

Nope, the Dow is about where it was in April and in August. I conclude that the sky is not falling.
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Old 11-12-2007, 01:24 PM   #28
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There is a line of tax increases in the works. History says that will create an economic slowdown.
As in 1994?
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Old 11-12-2007, 02:33 PM   #29
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I read the title to this thread, so I have to go check for myself to see if the "Dow is way down" ....

Nope, the Dow is about where it was in April and in August. I conclude that the sky is not falling.
Good point!!

Like many others here who are in the accumulation phase, I have more in my accounts than I did last summer. So, that confirms it. The bright blue sky is still pasted up there where it belongs. For now, anyway....
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Old 11-12-2007, 06:04 PM   #30
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Well - at the start of the season - I was wildly optimistic about the Saints and pesimistic about the stock market.

Anything between 100% to 50% wrong will be ok.

heh heh heh - although I would like the Saints to win a few more games.
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Old 11-13-2007, 06:41 AM   #31
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Old 11-13-2007, 10:31 PM   #32
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I am no market Maven but the gyrations of the stock market right now are disconcerting. Way up one day, way down the next gives me the feeling that this is a trader, not a fundamental, market. Manic depressive is my diagnosis and the 'secured' debt situation has not unwound.

Anyone else feeling like things are not quite right?
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Old 11-13-2007, 10:59 PM   #33
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As in 1994?
Right. Those 1994 tax increases created the longest recession the US has ever seen. It was tough, I tell ya, tough. No jobs, stagflation, no innovation.....
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Old 11-13-2007, 11:06 PM   #34
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Doom! Doom! (OK, I'm right only about half the time.)
Which half? - ERD50
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Old 11-13-2007, 11:41 PM   #35
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I am no market Maven but the gyrations of the stock market right now are disconcerting. Way up one day, way down the next gives me the feeling that this is a trader, not a fundamental, market. Manic depressive is my diagnosis and the 'secured' debt situation has not unwound.

Anyone else feeling like things are not quite right?
You are suffering from recency bias. In the past, I believe the market was routinely more volatile than it is nowadays. This year we have had (so far) a couple of 8-10% drops (over the course of a few days or weeks).

Let me ask you this: What do you think happened in 1998? In 1997?
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Old 11-14-2007, 02:35 AM   #36
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Don't know about the sky... but my portfolio has given back a few point.
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Old 11-14-2007, 06:47 AM   #37
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So what's the best portfolio mix to be in during these times?
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Old 11-14-2007, 08:05 AM   #38
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So what's the best portfolio mix to be in during these times?
Cash on the down days, highly volatile stocks on the up days.

But, since you are unlikely to know which is which ahead of time*, you've got to pick an asset allocation, and stick with it. That's what it's for.

'These times' will only be apparent in the rear-view mirror. As soon as you adjust your portfolio for 'these times' you may find yourself in 'some other times'. And then you may be wondering why your portfolio is doing so poorly, you seem to always be in the wrong mix. What went wrong?

-ERD50

* If you do figure out how to do this, PM me please.
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Old 11-14-2007, 09:59 AM   #39
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So what's the best portfolio mix to be in during these times?
The same as the other times.
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Old 11-14-2007, 12:06 PM   #40
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I am no market Maven but the gyrations of the stock market right now are disconcerting. Way up one day, way down the next gives me the feeling that this is a trader, not a fundamental, market. Manic depressive is my diagnosis and the 'secured' debt situation has not unwound.
Geez, Brat, now they have you doing it too?!?

Maybe the best response to these types of threads is to simply say "Yes, Virginia, you're absolutely right, the sky really is falling, get thee to a bomb shelter!" and to just get on with our lives.

But stock-market volatility (measured by the VIX) has been at an all-time low over the last couple years, and the last few months doesn't even approach the late 1990s-- let alone 2000-2003. It's worth noting that the difference between the Dow dropping from 14,000 to 13,000 is 1000 points. That may be nearly twice the points of the Oct 1987 drop but today it's a measly 7%-- less than one-third of the Black Monday percentage drop. Just a blip on the investing radar.

Traders look for "true selling" and "true buying" days of at least 1%... that's over 130 points now. So 250 points should be making the traders happy, and 500 points should be making them ecstatic. Instead hordes of "investors" race to the nearest discussion board, drop to the ground, and start writhing in agony & foaming at the mouth.

As for the magnitude of the volatility in one's personal portfolio, it could be measured in scary "years of salary" numbers or it could be assessed in percentages. Despite all these walls of worry being pelted by falling skies, our portfolio value has only oscillated by a couple percent. We're up 8.7% YTD (ooh, but Berkshire Hathaway is up today!) and I bet the year-end number is between 6-10%. Truly terrifying.

BTW if the price of gold at its 1980 peak of $850/oz was adjusted for inflation, today it'd be over $2075/oz. So I wouldn't worry until gold at least doubles from its current price...
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