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Old 08-08-2011, 02:56 PM   #81
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Sort of. This is what I was expecting/hoping for since it seems like an over reaction to me. I have acted on my prediction but I am not real confident. This could keep going for a while. I still have room to buy more if we keep falling. But then maybe I will be twice a fool.
I've had several things blow past my old rebalance target of 10%, which I changed to 25% after 2008-2009 caused me to catch a falling knife or two...

Like a deer in headlights... Steady as she drops goes!
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Old 08-08-2011, 02:58 PM   #82
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I am offering $1 million dollar for the rental of time machine. It just needs to go back 2 weeks and return. A $100K bonus if it looks like a Deloran.
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Old 08-08-2011, 03:08 PM   #83
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60/40 AA is now 53/47. Should I rebalance to 60/40 now or wait for the dust to settle a bit?
You should probably have some predefined criteria and stick to it or else you're likely to allow greed and fear -- two wealth-killing emotions -- sway your decision.
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Old 08-08-2011, 03:13 PM   #84
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Been buying today but am running out of ammo.
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Old 08-08-2011, 03:17 PM   #85
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Originally Posted by donheff View Post
Sort of. This is what I was expecting/hoping for since it seems like an over reaction to me. I have acted on my prediction but I am not real confident. This could keep going for a while. I still have room to buy more if we keep falling. But then maybe I will be twice a fool.
Well, if you are the fool you will have some company. I decided to rebalance and sold bonds and bought stocks for about 7% to get back to 60/40. Time will tell if I am a hero or a goat.


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You should probably have some predefined criteria and stick to it or else you're likely to allow greed and fear -- two wealth-killing emotions -- sway your decision.
You are right, and I probably should write something down, but I generally rebalance in January or when my AA gets more than 5% out of whack. It is rare that I end up doing much other than in January. (no magic to January by the way).
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Old 08-08-2011, 03:29 PM   #86
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Been buying today but am running out of ammo.
I thought of buying at the open. Good thing I'm a procrastinator. Probably won't do anything, should look at my AA sometime, but I think that took care of itself today


I've already prepared my calming statement if DW comes home wondering why everyone on the radio are screaming about the market collapse -

Honey, our NW is higher than it was one year ago, higher than it was two years ago, and higher than it was when I first retired. Now, excuse me while I wash, rinse, and dry these used zip-lock bags....


-ERD50
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Old 08-08-2011, 03:36 PM   #87
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Well, if you are the fool you will have some company. I decided to rebalance and sold bonds and bought stocks for about 7% to get back to 60/40. Time will tell if I am a hero or a goat.
I see no reason to be leery of re-balancing to your preset AA. I decided to get more conservative recently and had sold stocks getting down to my new 60/40. Luckily I sold around this year's top. The last few weeks big drop moved me all the way to my AA (and would possibly be a bit low on equities after today's close). Nevertheless, I couldn't resist taking a chance and bought more equities today - I will probably be back up around 66% equities. If I guessed wrong I have enough cash to sit tight for quite a while waiting for a recovery. If I guessed right and we bounce back toward DOW 12,500 later this year, I plan to go back down to 60/40.
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What will happen on Tuesday?
Old 08-08-2011, 03:54 PM   #88
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What will happen on Tuesday?

Time to switch the thread. Now that we saw what happened on day one post downgrade, what about day 2? Rebound or no?

I tuned in to Closing Bell to listen to all the pundits rant and everybody is anticipating a brief rally. They put some technical guy on there talking about bands, testing, and the like. The guy sounded crazier than a witch doctor. How can people take this stuff seriously? No offense to any true believers on the board.
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Old 08-08-2011, 04:06 PM   #89
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Now we know what happened on Monday.

Ouch!
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Old 08-08-2011, 04:10 PM   #90
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Time to switch the thread. Now that we saw what happened on day one post downgrade, what about day 2? Rebound or no?

I tuned in to Closing Bell to listen to all the pundits rant and everybody is anticipating a brief rally. They put some technical guy on there talking about bands, testing, and the like. The guy sounded crazier than a witch doctor. How can people take this stuff seriously? No offense to any true believers on the board.
I never watch CNBC, and I certainly won't today, sort of asking for it IMO. I am encouraged that most of the talking heads I saw yesterday and briefly on CNN this AM were warning people not to panic and do something stupid. I'll probably watch NBC news and that's it. This is no where near as dangerous as 2008, things will calm down again soon enough.
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Old 08-08-2011, 04:15 PM   #91
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Well, what we do know is the US Treasuries were downgraded, and as a result, investors sold out of as much stuff as they could so they could buy more Treasuries, bidding up the price. Makes sense to me.
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Old 08-08-2011, 04:19 PM   #92
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Well, what we do know is the US Treasuries were downgraded, and as a result, investors sold out of as much stuff as they could so they could buy more Treasuries, bidding up the price. Makes sense to me.

I am waiting for S&P folks to start complaining that they are the Rodney Dangerfield of the finance world. "Look people when we down grade something is suppose to drop in price not rise."
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Old 08-08-2011, 04:22 PM   #93
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Been buying today but am running out of ammo.
Quite the opposite for me -- I have increased my supply of ammo recently.
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Old 08-08-2011, 04:23 PM   #94
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Now we know what happened on Monday.

Ouch!
Yeah. I was wrong. Big time. I called the big dip when the markets opened (who didn't see that coming?) but thought things would recover at least a bit by day end when the bargin shoppers moved in. One thing that's worrying me now is BAC. Too big to fail and we don't have the political environment or money for another bailout. Not saying a bailout would be wise, but BAC going down could be like throwing gas on the fire.
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Old 08-08-2011, 04:34 PM   #95
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Next question: What will happen on Tuesday?
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Old 08-08-2011, 04:53 PM   #96
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Just to show my contrary nature (not contrarian in the financial sense, just contrary ), what actually happened today is that the S&P 500 closed 65% above its March 2009 low point. Hang in there, friends.
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Old 08-08-2011, 05:16 PM   #97
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... what actually happened today is that the S&P 500 closed 65% above its March 2009 low point.
Are you saying we have quite a way to go?
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Just to show my contrary nature (not contrarian in the financial sense, just contrary )...
That's my excuse for posting, too.
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Old 08-08-2011, 05:20 PM   #98
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60/40 AA is now 53/47. Should I rebalance to 60/40 now or wait for the dust to settle a bit?
You're not allowed to make up the rebalancing rules as you go along. Doing so makes you a market timer.
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Old 08-08-2011, 05:25 PM   #99
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Are you saying we have quite a way to go?
Absolutely.
I'm not saying which direction though.
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Old 08-08-2011, 05:28 PM   #100
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Absolutely.
I'm not saying which direction though.
Can you at least give us a hint?
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