Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Recession and the stock market
Old 10-30-2007, 08:10 AM   #1
Thinks s/he gets paid by the post
 
Join Date: Nov 2006
Posts: 2,268
Recession and the stock market

OK, so lets assume that we are in or will very shortly will be in a recession.

How has the stock market perforemd in previous recessions?
__________________

__________________
utrecht 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 10-30-2007, 09:53 AM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,454
If we were already in a recession, the stock market would have sold off 6 months ago - say 20%. It did sell off 10% over the summer, but since recovered to new highs and has pulled back a little.

You really can't know/predict this stuff!

Usually, the market sells off pretty hard 6 months ahead of a recession. But there are lots of other reasons why the market might sell off.

Audrey
__________________

__________________
audreyh1 is online now   Reply With Quote
Old 10-30-2007, 10:30 AM   #3
Recycles dryer sheets
 
Join Date: Oct 2007
Posts: 156
(ETF) SH might be a good bet if you think your timing and knowledge are correct.
__________________
wcv56 is offline   Reply With Quote
Old 10-30-2007, 02:35 PM   #4
Thinks s/he gets paid by the post
 
Join Date: Nov 2006
Posts: 2,268
I have no idea if we are in a recession or heading for one. Im just asking how the market has reacted in previous recessions.

Wasnt there a recesison in '90-'91? The market did pretty good during that timeframe.
__________________
utrecht is offline   Reply With Quote
Old 10-30-2007, 03:09 PM   #5
Thinks s/he gets paid by the post
twaddle's Avatar
 
Join Date: Jun 2006
Posts: 1,378
Recessions mean that earnings drop. The stock market does not like recessions. The last one was in 2001, and you remember how that went.

Here's 1990:

__________________
twaddle is offline   Reply With Quote
Old 10-30-2007, 05:03 PM   #6
Thinks s/he gets paid by the post
 
Join Date: Nov 2006
Posts: 2,268
The conditions today are even remotely close to 2001. I would bet they are closer to 1990 than 2001.

The chart shows the DJIA market flat and the Nas up during that recession. Besides, thats only 7 months. That doesnt mean much of anything.

Is there any multi - recession data?
__________________
utrecht is offline   Reply With Quote
Old 10-30-2007, 05:12 PM   #7
Thinks s/he gets paid by the post
twaddle's Avatar
 
Join Date: Jun 2006
Posts: 1,378
Quote:
Originally Posted by utrecht View Post
The conditions today are even remotely close to 2001.
You're right. We're having a *much* bigger housing bust this time. Probably Japan-1990 is a better analogy.
__________________
twaddle is offline   Reply With Quote
Old 10-30-2007, 07:35 PM   #8
Thinks s/he gets paid by the post
Spanky's Avatar
 
Join Date: Dec 2004
Location: Minneapolis
Posts: 4,046
Quote:
Originally Posted by twaddle View Post
You're right. We're having a *much* bigger housing bust this time. Probably Japan-1990 is a better analogy.
Are you pretty much in cash already?
__________________
Spanky is offline   Reply With Quote
Old 10-30-2007, 07:43 PM   #9
Thinks s/he gets paid by the post
twaddle's Avatar
 
Join Date: Jun 2006
Posts: 1,378
Quote:
Originally Posted by Spanky View Post
Are you pretty much in cash already?
No, I'm going down with the rest of you.

There's no way to predict the duration or magnitude of a recession. I think we'll probably have one, and I may do some "tactical allocation" if the indicators become more bearish.

In the meantime, I get my thrills with an occasional options-based bet.
__________________
twaddle is offline   Reply With Quote
Old 10-30-2007, 08:14 PM   #10
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,454
Quote:
Originally Posted by utrecht View Post
I have no idea if we are in a recession or heading for one. Im just asking how the market has reacted in previous recessions.

Wasnt there a recesison in '90-'91? The market did pretty good during that timeframe.
No, the market did poorly going into it.

Remember, the market sells off before the recession, during the recession - at least towards the end of it, the market recovers.

Audrey
__________________
audreyh1 is online now   Reply With Quote
Old 10-30-2007, 09:37 PM   #11
Thinks s/he gets paid by the post
 
Join Date: Nov 2006
Posts: 2,268
Well, if earnings are bad during a recession and the market sells off before a recession, then we arent in one.

Earnings have been mostly good and the market is definatley not selling off.

I think this is all just mumbo jumbo. Its like chart reading. You can make it say whatever you want it to say.
__________________

__________________
utrecht is offline   Reply With Quote
Reply


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

Advanced Search
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


Similar Threads
Thread Thread Starter Forum Replies Last Post
Hmm, stock market or Money Market/CD? Moneycoming Stock Picking and Market Strategy 4 08-14-2007 07:41 PM
Stock Market Danny Other topics 14 05-19-2006 03:32 PM
What good is the stock market? oldcrowcall FIRE and Money 39 10-21-2005 04:27 PM
Total Stock Market geeman Young Dreamers 23 09-08-2005 10:02 PM
Stock Market Overpriced? thechoson FIRE and Money 21 05-06-2005 07:54 AM

 

 
All times are GMT -6. The time now is 02:58 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.