it's the crash of October 2014 all over again

[jim584672]

Don't worry. The Fed will have to buy all that defaulting high yield oil paper with a new round of QE.

Bad news = exploding market

Rates at 0% for the next decade at least.

 

[daylatedollarshort]

Same here. But counting from personal top, it's $178K gone!

Well, it's still the money that the market god [-]gave[/-] loaned. It still hurts though.

We decided we didn't have the nerves of steel to withstand losses like that any more at our ages and not having full time employment any longer to offset it.

We just keep working on lowering our expenses instead so we can live off a very conservative AA and withdrawal rate. I'm just not a good risk taker.

 

[NW-Bound]

The way I look at it, if I weren't in the market I would not have that money to "lose" in the first place. And also, life would not be as exciting.

Lemme see after today's drop, how much I have "lost" since that personal top. It's...

Oh wait! I forgot to account for our withdrawal for spending since that high watermark. So, it's only $147K, even after today's loss. Ah, I feel better now.

 

[mathjak107]

So we can claim any return we want because changes in the market might make it eventually true?



Which 15 year period?

Again showing real returns with dividends reinvested here: S&P 500 Return Calculator - Don't Quit Your Day Job...

Even the peark March 2000 you mentioned shows over a 2% return to today. I'm not doubting one exists (I sure haven't run every 15 year period) but sure am having trouble getting that calculator to back up either your original 1.3% claim or your later 1.73%.

Nov 99 to Nov 2014 shows 1.954% real return with dividends reinvested, does that mean failure for a portfolio? It would be interesting to know which percentage of portfolios would fail after a 2% return over first 15 years, especially if you keep in mind very few people are 100% stocks during withdrawal phase and much of the last 15 years has been a bond bull.

according to kitces the math needed to sustain the 4% rule in the lab with no real world spending patterns is you must sustain at least a 2% real returen average over the first 15 years of any 30 year retirement period.

mathamatically you would have failed every time so far that you didn't.

y2k retirees so far have not done that but so far that is the only recent period that clocked in less than 2% real return .

there were a number of time frames that did not in the past and they all ended up being failure periods.

 

[2B]

The whole purpose of this market tanking is to rattle my nerves so I'll sign up for OMY. It's not working so far so we can expect it to get really ugly now. I've got two "in office" days left until my Jan 5 resignation/retirement.

Nominal 10% market corrections are pretty normal. There can be several in any given calendar year and the market can still be positive for the year. It's hard to get too excited until a 20+% plunge happens. It's definitely more fun to watch it go up.

 

[tuixiu]

according to kitces the math needed to sustain the 4% rule in the lab with no real world spending patterns is you must sustain at least a 2% real returen average over the first 15 years of any 30 year retirement period.

mathamatically you would have failed every time so far that you didn't.

y2k retirees so far have not done that but so far that is the only recent period that clocked in less than 2% real return .

y2k retirees with 100% of their assets in the stock market, do you think this is common?

 

[tuixiu]

So, it's only $147K, even after today's loss. Ah, I feel better now.

Kinda weird when you consider that loss compared to the stats one always seen thrown around in those avg net worth oh-my-gosh type articles. You probably lost from peak more than most people ever had.

 

[audreyh1]

The way I look at it, if I weren't in the market I would not have that money to "lose" in the first place. And also, life would not be as exciting.

Lemme see after today's drop, how much I have "lost" since that personal top. It's...

Oh wait! I forgot to account for our withdrawal for spending since that high watermark. So, it's only $147K, even after today's loss. Ah, I feel better now.

Right! I don't bother to see how much I "lost" during a given period, because I gained that much earlier in the year, so it really doesn't matter.

 

[UnrealizedPotential]

I want to be the first to panic that this downturn will be ruiness.

Remember how bad it was in October? We are headed for at least that kind of calamity, possible worse this time. In fact we may never recover again. It may be a new normal in which stock owners report to work each day because the laborers are in charge of investment capital.


I just saw a dog living with a cat and they had a pet duck.

Even if we enter bear market territory with this current downturn, it should be of no concern to the long term investor. I know watching your accounts go down is no fun. What has worked for me is to invest whatever I can regardless of the market strength. You have to have an iron will to be a stock investor.

 

[NW-Bound]

Kinda weird when you consider that loss compared to the stats one always seen thrown around in those avg net worth oh-my-gosh type articles. You probably lost from peak more than most people ever had.

Yes, I did not think that I would get used to seeing that kind of "loss". It was because I had a lot higher loss in the past, both in terms of dollars amount as well as percentage of portfolio. In the tech rout of 2002, I truly lost $600K when I capitulated and sold most of my tech stocks to buy something else. But I did not leave the game, chalked it to experience and tried to do better.

And the above happened when our small business floundered, and I was sitting in our office suite by myself (I was the one to turn out the light at this local office), wondering what [-]to do with the rest of my life[/-] to buy food with.

Heh heh heh... My life is nowhere as exciting as that of many I have read, but it has a bit more varieties than if I had just stayed at megacorp. Heh heh heh...

 

[daylatedollarshort]

The way I look at it, if I weren't in the market I would not have that money to "lose" in the first place. And also, life would not be as exciting.

Lemme see after today's drop, how much I have "lost" since that personal top. It's...

Oh wait! I forgot to account for our withdrawal for spending since that high watermark. So, it's only $147K, even after today's loss. Ah, I feel better now.

I have realized that is one reason I am more conservative with investing than most here. We didn't acquire most of our savings from the stock market. It was more from just working and saving and we don't want to have to do that all over again at our ages.

I am glad your losses are not as high as you originally thought.

 

[NW-Bound]

PS. My wife is getting more seasoned too. I would tell her what we gain or lose at the end of each day when the last MF reports in, and Quicken has tallied it all up. She used to be scared at big drops, but now she would just say "That's bad", then went back to watching her Internet video.

 

[2B]

PS. My wife is getting more seasoned too. I would tell her what we gain or lose at the end of each day when the last MF reports in, and Quicken has tallied it all up. She used to be scared at big drops, but now she would just say "That's bad", then went back to watching her Internet video.

I think I've successfully desensitized my wife. I'll say something like "We lost as much today as our 3 week Italy trips cost." Part of it is to get her to not sweat the cost of our vacations. A major vacation is literally market noise on our portfolio value.

I will say that your portfolio must be significantly larger than ours. We're not anywhere near $147,000 in losses.

 

[NW-Bound]

I have realized that is one reason I am more conservative with investing than most here. Our money didn't come mainly from the market.

I do not know exactly how much of our money comes from the market, but I want people to know that it is not a gain of 5X or 10X like someone who happened to luck out on a hot stock. As money comes and goes from our accounts (my pay was irregular and so are our expenses), an accurate accounting is difficult. But I can be sure that if I managed to beat the market over all my investment years, it was not that much. I might just have had a lot more fluctuations.

So, as a LBYM'er, I could have obtained the same by putting all my savings in Wellesley, who knows? But I would not have stories to tell. Heh heh heh...

 

[NW-Bound]

I think I've successfully desensitized my wife. I'll say something like "We lost as much today as our 3 week Italy trips cost." Part of it is to get her to not sweat the cost of our vacations. A major vacation is literally market noise on our portfolio value.

I will say that your portfolio must be significantly larger than ours. We're not anywhere near $147,000 in losses.

I have a bit of energy and basic material stocks, plus emerging markets. These sectors have been hurting more than the S&P. My performance tracked the S&P for a while even though I am only 70% in stocks (higher alpha!), but then it decoupled from the S&P. My portfolio peaked on July 3rd, while the S&P did not peak till Sep 18. Then, when things got ugly, mine dropped more.

The "loss" I quoted was counted from that personal high on July 3rd. It was 5 months ago, and of course what I have spent since then has to be accounted for. Hence, the real loss is not as bad as I first computed.

 

[marko]

The 29th in 29. It was IN the papers!

Not a funny story but interesting from a personal perspective:

October 29th of 1929 my great grandmother died. Gr. Granpa had just come back from downtown and told her "the markets have crashed; the banks are closed".

She dropped dead right there in the doorway.

 

[bob boag]

Before today (another $10K loss?) I am down $43K over the last 7 trading days. About 1.5% of my investable assets; 0.9% of my net worth. Pretty comfortable with my AA.

 

[jim584672]

Before today (another $10K loss?) I am down $43K over the last 7 trading days. About 1.5% of my investable assets; 0.9% of my net worth. Pretty comfortable with my AA.

3MM investable - Nice to have.

 

[imoldernu]

For the chartists....
(hope I don't get banned for linking this)
anyway... very colorful.

http://www.zerohedge.com/news/2014-12-16/total-chaos-massive-market-moves-spark-selling-panic-close

25 charts.

 

[M Paquette]

Meh.

Maybe it will turn out to be a bear market. Gosh, then I might have to rebalance the portfolio, if it happens to be out of balance on my annual check date.

For those who like to read the [-]entrails[/-] charts, there are usually three cyclic (short term; months) bear markets within a secular (long term; several years) bear market. If this is a cyclic bear market starting, it will be the third one in a secular bear market.

I'm going back to sleep. Hey, someone ring a bell when we're at the bottom, OK?

 

[Major Tom]

You have to have an iron will to be a stock investor.

Either that, or simply have the constitution where you don't get easily worked up about things. If you have the right temperament, "setting and forgetting" your portfolio, with the exception of occasional rebalances, is a particularly easy thing to do. If you're talking about individual stocks, as opposed to a lazy portfolio with funds, I'd suggest that a similar temperament is equally beneficial.

 

[dallas27]

Personally i've learned to "enjoy" the losses. I take great pride in how much i can lose in a day/month/quarter and nothing really changes. I can't wait to be able to lose a million!


Sent from my iPhone using Early Retirement Forum

 

[NW-Bound]

The only real requirement to lose a million is to have a million in the first place. After that, losing it is no feat. Hanging on to it might be.

 

[harley]

For the chartists....
(hope I don't get banned for linking this)
anyway... very colorful.

http://www.zerohedge.com/news/2014-12-16/total-chaos-massive-market-moves-spark-selling-panic-close

25 charts.

Whoa, flashback to the acid 70s. Tracers, dude.

 

[bingybear]

crap... not again... another 3 week bust and boom... and I'll likely miss it.

if this is another 2008-9... likely worth looking at.