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Old 01-15-2016, 04:38 PM   #41
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...I was thinking more like the 2009 Jordan Cabernet.
Even at $50, this is not something I drink often, and certainly not at a restaurant where they charge 3x more.

Yes, a guy is frugal (or do you call him cheap) when he can lose a 6-figure sum in less than a week, but is extremely reluctant to pay $50 for a bottle of wine. I do pay a lot more for spirits, but then they last longer than one meal.
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Old 01-15-2016, 04:47 PM   #42
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Even at $50, this is not something I drink often, and certainly not at a restaurant where they charge 3x more.
Unfortunately I developed a taste of fine wine when we entertained customers back in the days. We don't do it often but every once in a while we splurge on a nice Filet Mignon and a Jordan at the Capital Grille.

Who knows if this may be our last for a while especially if the market drops another 20% before our next dinner....
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Old 01-15-2016, 04:47 PM   #43
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See, there's the problem. In 2008, the Fed had a lot of ammo in the form or lowering interest rates, and they pretty much used all of it. It helped avoid a total and complete meltdown of the global financial market, but the ammo they used (dropping interest rates to zero) has not recovered to be made available again.

I'm not a doomsday type but it does concern me that if it gets bad enough, there's almost nothing the Fed or other global central banks can do.
This concerns me as well. I suppose they could cease interest rate hikes and resume QE.
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Old 01-15-2016, 04:50 PM   #44
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This concerns me as well. I suppose they could cease interest rate hikes and resume QE.
Japan
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Old 01-15-2016, 05:27 PM   #45
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Good point that the Fed has fewer arrows in their quiver. Then, though, the 2008 drop was because the assets being traded or valued were in many cases worthless - mortgages based on an ability to pay that in many cases was non - existent. Those holding the mortgages were going to default in mass, and the houses were overvalued too.

Now the markets are dropping because oil is low and the Chinese economy is slowing. In some respects, oil being low is not a bad thing. People drive more, buy larger cars, buy houses further from work, ship goods cheaper, perhaps travel more as costs are cheaper - all things that will drive the economy up. And cynically, it will just take another war, a few refineries closing, the oil reserves gradually depleting as companies drill less, before oil becomes more valuable. I don't see society moving significantly away from oil for another decade. One way or another I think oil will rebound - or the energy companies will diversify into something else they can sell.

I don't see the central banks caring more for the long term economy over short term profits, even if, as was proven with the mortgage crisis, they knew what they were selling was crap,

I also don't see the Federal government doing anything to rein in the deficit, which has been a significant weakness. During the last crisis, the Russians approached the Chinese to crash the U.S. economy. At the time the Chinese refused, because they perceived their economy depended upon selling to the U.S. But though our government knew this, it continues to spend. Most Americans seem oddly clueless or careless that you shouldn't spend what you don't have and don't insist on a balanced budget. In fact, anyone suggesting that is reviled as being heartless, or racist, or something equally vile. Meanwhile, others who've struggled to pay their way and save are reviled for not being willing to pay the way for others. I don't see the government or popular trend move toward making good choices - in fact the choices made after the last crisis often seemed to perpetuate the same practices and increase the risk. But that didn't stop people after 2008 from investing in the market and doing well. The central banks naturally will be more concerned with their survival than the U.S. economy, and the Fed will assist them because these entities have become so large that the Fed can't cover their collapse. It may be out of arrows for its quiver.

So yes, if things melt down, it could get very very bad. But in that worst case scenario, is there a place where $$ are going to be safe? Stocks will crash. If the banks go en masse, can the bond market survive? The dollar may be worthless paper. After all, we're hardly on the gold standard. Some have claimed the dollar only has held what worth it has because global oil is traded in it. Even if you have your dollars not in banks but buried in your back yard, what worth will paper have in such a scenario?

I'll admit to being very ignorant, and I have no solution of where to invest in such a fiasco. But if/when it happens, seems to me that it will be a much different game. And no one, yet, has a clue what that would be. Those who have made predictions as to such a total collapse, who have recommended doing things like investing in foreign currency (if the global banks crash, good luck), buying gold, or moving to some remote, self sufficient lifestyle are branded as kooks. Considering our economy collapsed in 2008 over banks buying and insuring mortgages as a good risk that were based on overvalued houses sold to people who couldn't afford them the definition of what is a kook in such a case is kind of amusing. Who is kookier, the average investor who looks at this house of cards and is skeptical, or the engineers of the house of cards? But right now, it is a game most companies who provide 401K funds, and most investors, are tied into playing.

Will the carousel stop and crash? Perhaps, maybe probably. Our country is very young in the scheme of things, and our financial markets based upon sometimes shaky principles. But for the average retiree or future retiree, WHEN this doomsday scenario will happen is more important, and WHERE to invest until then is the choice we all have to make. I wish our politicians, government, and banks treated the debt and the money they bandy about as if it were their own. Then perhaps we would be less vulnerable. A good reason to have smaller, more independent banks - but the Fed turned their backs on that scenario, preferring to consolidate into entities that are even more "too big to fail" than before. Again, I am far from being as knowledgeable as I could wish, but in such a doomsday scenario as you put forward, won't the game be very different and the question as to whether to buy or sell in the market minor in comparison?
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Old 01-15-2016, 05:44 PM   #46
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Snip...During the last crisis, the Russians approached the Chinese to crash the U.S. economy. At the time the Chinese refused, because they perceived their economy depended upon selling to the U.S. snip
Oy Vey, Where is Rewahoo's asteroid to put us out of our misery...
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Old 01-15-2016, 06:51 PM   #47
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This concerns me as well. I suppose they could cease interest rate hikes and resume QE.
Another round of QE would help but this will be hard proof of Jim Rickards "Currency Wars" point of view as other major economies will follow the suit. It would certainly lead to hyper inflation. Mr Rickards advises on portfolio consisted on Gold, Real Estate, Land, Arts and some equities of companies "with a future". However his predictions of Gold price going through the roof yet to be seen.
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Old 01-15-2016, 07:02 PM   #48
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All these predictions are self-fulfilling prophecies. If you and everyone else believe them, then everyone will turn their stocks to cash. Yeah, everyone will sell their stocks for cash. Everyone will be selling and selling. And their prophecy will be fulfilled. If you don't follow them, and do the opposite, the bull market will be back. It's all market psychology. "The end is near .. it's doomsday .. everything in the world will crash." Let everyone repeat that mantra, and then you have a self-fulfilling prophecy. And they will be buying and buying cheap. Then, they will begin to preach "Buy now, everything is cheap", but they have already bought in cheaper.

The thing is - the market already tanked by 15%. Yeah, it might tank another 5-10%. And after all the Fear is gone, the deep discount buying starts and the price jumps up. And you're left holding cash as prices have recovered. . The question is - can you time the market ?
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Old 01-15-2016, 07:08 PM   #49
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Old 01-15-2016, 08:36 PM   #50
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Oye. DH retires in May 😯


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Old 01-15-2016, 08:42 PM   #51
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So, will RBS make a "Buy everything!" announcement? At a price lower than the ones when they said "Sell everything!" Somehow I have my doubts.

If one wants to play market timer, one needs to reasonably predict both exit and entry points, AND act on them. We all know people who sold in late 2008/early 2009 and who are STILL out of the market.


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Old 01-15-2016, 09:03 PM   #52
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All these predictions are self-fulfilling prophecies. If you and everyone else believe them, then everyone will turn their stocks to cash. Yeah, everyone will sell their stocks for cash. Everyone will be selling and selling. And their prophecy will be fulfilled. If you don't follow them, and do the opposite, the bull market will be back. It's all market psychology. "The end is near .. it's doomsday .. everything in the world will crash." Let everyone repeat that mantra, and then you have a self-fulfilling prophecy. And they will be buying and buying cheap. Then, they will begin to preach "Buy now, everything is cheap", but they have already bought in cheaper.

The thing is - the market already tanked by 15%. Yeah, it might tank another 5-10%. And after all the Fear is gone, the deep discount buying starts and the price jumps up. And you're left holding cash as prices have recovered. . The question is - can you time the market ?
I don't imagine many people here in the market for the long term selling out in a market panic now. This doesn't seem like a doomsday scenario, at least not yet. But if you have some cash, a correction like this seems like a time to consider what to buy. If you don't time it at it's lowest, if you think the market is going to rebound, you'll stiill be that much ahead when it does.
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Old 01-15-2016, 10:41 PM   #53
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This correction is an opportunity to buy stocks at a price that will increase the chances of higher returns many retired people need to have a successful safe withdrawal strategy that will finance their lives.

The least risky way I know of doing that is to re-balance to the safety of my AA that I have tested over and over again using Firecalc and a few other calculators.
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Old 01-16-2016, 01:24 AM   #54
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Unfortunately I developed a taste of fine wine when we entertained customers back in the days. We don't do it often but every once in a while we splurge on a nice Filet Mignon and a Jordan at the Capital Grille.

Who knows if this may be our last for a while especially if the market drops another 20% before our next dinner....
We have been to Ruth's Chris and Morton steakhouses a few times, but just now see that there are a couple of Capital Grille in town. I should try that next. But is there really any difference in the prime cuts offered by these different steakhouses?
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Old 01-16-2016, 06:06 AM   #55
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This correction is an opportunity to buy stocks at a price that will increase the chances of higher returns many retired people need to have a successful safe withdrawal strategy that will finance their lives.

The least risky way I know of doing that is to re-balance to the safety of my AA that I have tested over and over again using Firecalc and a few other calculators.
But what if it's different this time?
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Old 01-16-2016, 06:33 AM   #56
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We have been to Ruth's Chris and Morton steakhouses a few times, but just now see that there are a couple of Capital Grille in town. I should try that next. But is there really any difference in the prime cuts offered by these different steakhouses?
To me Ruth's Chris, Fleming's, Morton and Capital grille are about the same in their prime cuts and prices but we just like the ambiance of the Capital Grille near where we are.
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Old 01-16-2016, 06:40 AM   #57
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We have been to Ruth's Chris and Morton steakhouses a few times, but just now see that there are a couple of Capital Grille in town. I should try that next. But is there really any difference in the prime cuts offered by these different steakhouses?
We frequent them all but my favorite his Ruth's Chris. Just something about the way it comes onto the plate.

Oddly, THE best steak I ever had was 20 years ago at Ruths' Chris in Taipei; and yes, I've gone the Kobe route in Tokyo as well but that one steak was just unbelievable!
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Old 01-16-2016, 06:47 AM   #58
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Unfortunately I developed a taste of fine wine when we entertained customers back in the days. We don't do it often but every once in a while we splurge on a nice Filet Mignon and a Jordan at the Capital Grille.

Who knows if this may be our last for a while especially if the market drops another 20% before our next dinner....
Had a fairly wealthy/stingy great-uncle who's last meal was at a Chinese hole in the wall...we saw him sitting on a folding chair eating out of a carton; heart attack later that night. (no, it wasn't the food that killed him!!)

My dad always said: "I wonder if he knew it would be his last meal if he'd have gone to a much better place..."
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Old 01-16-2016, 07:52 AM   #59
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My dad always said: "I wonder if he knew it would be his last meal if he'd have gone to a much better place..."
He might have lost his appetite if he knew it was going to be his last meal. Not sure what I'd do if I knew I only had hours to live, but eating probably wouldn't be high on my list.
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Old 01-16-2016, 08:13 AM   #60
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I highly doubt that as one's lights are going out any consideration of the last meal's quality is considered.

One case up close and personal I know by having been present, is opening the fridge door, and the person being dead before hitting the floor.
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