Sleeping Well in this crazy market?

[cyclone6]

Yet another Bear Stearns hedge fund is on the ropes...

UPDATE 3-Bear Stearns halts redemptions in third hedge fund | News | Market News | Reuters

No, they haven't said its worthless - yet. You just can't take your money out because they don't want investors to sell at such an inopportune time. Funny - I thought it was **my** money. Guess not.

Sounds to me like they're simply trying to stop a run.

This housing situation is a slow-motion disaster occurring right before our eyes. I believe anyone who thinks this will be contained within the housing market has been smoking something illegal. Dow 15000?

I'd take a bet - with odds, of course - that 10000 is more likely.

As for me, I've decided that having more than 100k in any individual bank at this time is foolhardy. I've got 300+k in an E*Trade bank complete savings account yielding 5.05%.

Not a bad interest rate, but its only FDIC insured to 100k.

And they are in the mortgage business as well as banking...

Time to spread it around...

 

[yona]

in the event of a
BIG correction (10% or more) how much should I expect this dividend
stream will shrink ??

I think that if you are reasonably diversified, you probably won't face a decrease in dividend payment unless there is a real economic recession (something I don't see happening in the near future)

Here is a list of "Dividend Aristocrats" - S&P 500 companies that have had increasing dividends for the past 25 years:

3M Co
Abbott Laboratories
Altria Group
Anheuser-Busch Cos
Archer-Daniels-Midland
Automatic Data Proc
Avery Dennison Corp
Bank of America
Bard (C.R.)
BB&T Corp
Becton, Dickinson
CenturyTel Inc
Chubb Corp
Cincinnati Financial
Clorox Co
Coca-Cola Co
Comerica Inc
Compass Bancshares
Consolidated Edison
Dover Corp
Emerson Electric
Family Dollar Stores
Fifth Third Bancorp
First Horizon Natl
Gannett Co
Genl Electric
Grainger (W.W.)
Johnson & Johnson
Johnson Controls
KeyCorp
Kimberly-Clark
Leggett & Platt
Lilly (Eli)
Lowe's Cos
M&T Bank
McDonald's Corp
McGraw-Hill Companies
Nucor Corp
PepsiCo Inc
Pfizer, Inc
PPG Indus
Procter & Gamble
Progressive Corp,Ohio
Questar Corp
Regions Financial
Rohm & Haas
Sherwin-Williams
Sigma-Aldrich
SLM Corp
Stanley Works
State Street Corp
Supervalu Inc
Synovus Financial
Target Corp
U.S. Bancorp
VF Corp
Wal-Mart Stores
Walgreen Co
Wrigley, (Wm) Jr

 

[whitestick]

Dow 15000?

I'd take a bet - with odds, of course - that 10000 is more likely.

How about a bet that the Dow may hit both of those numbers in the same month? What do you figure those odds need to be?

 

[al_bundy]

What indeed? Now I have another question, if you know the answer. AHM was the "10th largest". How many between 1 and 10 do we have to go?

i think new century was #1 at one time. now comes the part where all the banks thought they could sell foreclosures for more than the amount owed

 

[cyclone6]

How about a bet that the Dow may hit both of those numbers in the same month? What do you figure those odds need to be?

Nah - I figure that would take at least 2 months to occur...

That wouldn't be a bad time to be in the VIX volatility futures though, would it?

 

[Jeb-NY]

Because of procrastination and vacations I shifted from 60 Stocks - 40 Bonds/Cash to 42 Stocks - 58 Bonds/Cash back around the end of May beginning of June. I moved about 1/3 of my total assets out of a company 401K to VanGuard and in sat in my Money Market Account for the waiting period. I then started to rebalance back to 60/40 but decided to do it in two chucks since it was a lot of money and didn't want to hit a peak.

So after watching the 14,000+ peak with all this extra cash and think now would be a dumb time to jump in and now watching all the swings I'm feeling pretty comfortable staying in cash right now. At 20 months into ER I'm sleeping well and probably would be sleeping well at my 60/40 split also.

Now the problem of deciding when to jump back into to rebalance to 60/40.

Jeb

 

[CuppaJoe]

So after watching the 14,000+ peak with all this extra cash and think now would be a dumb time to jump in and now watching all the swings I'm feeling pretty comfortable staying in cash right now. At 20 months into ER I'm sleeping well and probably would be sleeping well at my 60/40 split also.

Now the problem of deciding when to jump back into to rebalance to 60/40.

Jeb

I'll drink to that, make mine green, maybe a mint julep.

 

[whitestick]

Nah - I figure that would take at least 2 months to occur...

That wouldn't be a bad time to be in the VIX volatility futures though, would it?

Yep, although I'm in options now, and really enjoying the wild swings. Can't believe what some people are willing to pay right now. Wouldn't surprise me if I could find a put and call straddle that would return 100% of the underlying stock price over a 6 month period. Haven't found it yet, but I'm looking.