Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Who do you trust?
Old 07-18-2018, 06:56 AM   #1
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
imoldernu's Avatar
 
Join Date: Jul 2012
Location: Peru, il
Posts: 5,060
Who do you trust?

Fire and Money...While I don't invest, I'm curious enough about what's going on in the current financial news.

Roaming around the financial pundits there seems to be enough variety of thought about the near time future of the market that it gets confusing. Breaking news every day, with gloom and doom facing off with giddy excitement. Daily fluctuations but most recently the market seems to be positive, likely following the positive economy I guess.

So, just this morning, floating around the headlines, two caught my eye... one about Russia divesting of 100 Billion in US treasuries... and another horror headline from banyan hill. Yikes! But the market hardly twitches.

Back to the question... Who do you trust? If I correctly read the temperature here on ER, investing is long term, and with trusted advisors. It's like... "don't worry about the day to day".... stay the course and trust. Not to make a killing, but not to lose one's shirt.

How do you handle a headline like "Armageddon... August 1"? My own inclination is to cash out my savings accounts and buy gold.

signed,

babe in the woods
__________________

imoldernu is online now   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 07-18-2018, 06:59 AM   #2
Moderator
braumeister's Avatar
 
Join Date: Feb 2010
Location: Northern Kentucky
Posts: 11,154
Quote:
Originally Posted by imoldernu View Post
How do you handle a headline like "Armageddon... August 1"?
By ignoring it.
__________________

__________________
I thought growing old would take longer.
braumeister is online now   Reply With Quote
Old 07-18-2018, 07:05 AM   #3
Administrator
MichaelB's Avatar
 
Join Date: Jan 2008
Location: Home Sweet Home
Posts: 27,159
Quote:
Originally Posted by braumeister View Post
By ignoring it.
Or avoiding it completely. Remember this thread? Am I alone? Or do others find themselves trying to actively disengage from the news?
MichaelB is online now   Reply With Quote
Old 07-18-2018, 07:28 AM   #4
Thinks s/he gets paid by the post
Jerry1's Avatar
 
Join Date: Nov 2014
Posts: 1,207
Quote:
Originally Posted by braumeister View Post
By ignoring it.
Quote:
Originally Posted by MichaelB View Post
Agree. Iím naturally a pessimist (financially speaking only) and if I reacted to the news, Iíd be broke because I would have focused on all the bad predictions and been more of a live for today person with my money, because why bother saving/investing when the bottom is going to drop out any day now.
__________________
Retired 9am 1/17/2018 - 56yo
Jerry1 is offline   Reply With Quote
Old 07-18-2018, 07:29 AM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
imoldernu's Avatar
 
Join Date: Jul 2012
Location: Peru, il
Posts: 5,060
Quote:
Originally Posted by MichaelB View Post
Yeah, Michael... and I know you're right, because of what we've seen. Still, I'm haunted by memories of a best friend who retired in 2007, with about $800K in investments. A scary thing when it went to $400K+ in a flash. Of course it recovered, and he was okay, but a heartstopper.

Here's the headline article that prompted the thought.

https://banyanhill.com/exclusives/70...arns/?z=977296

It all sounds so real... I've been watching bitcoin, and Netflix and Google... shocker headlines and fluctuations, and predictions. Good and bad.

Am thinking it really is time to up the Prozac and turn off the TV. Back to Woodhaven to work on the seawall, and maybe to up the 1 and 1/2 oz. four o'clock martini to 2 ounces. Prosit!!!
imoldernu is online now   Reply With Quote
Old 07-18-2018, 07:38 AM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Sep 2005
Location: Northern IL
Posts: 19,697
Quote:
Originally Posted by imoldernu View Post
Yeah, Michael... and I know you're right, because of what we've seen. Still, I'm haunted by memories of a best friend who retired in 2007, with about $800K in investments. A scary thing when it went to $400K+ in a flash. Of course it recovered, and he was okay, but a heartstopper. ...!
And reading financial 'advice' wouldn't have helped. That's why most of us ignore it.

You will always find 'advice' saying "GET OUT OF THE MARKET NOW!!!!!". If we followed that, we'd never have money in the market, and we wouldn't have the gains we have.

Ignore it. Not just to calm yourself, but also realizing it is of no help whatsoever. So you're not missing anything.

-ERD50
ERD50 is online now   Reply With Quote
Old 07-18-2018, 07:56 AM   #7
Recycles dryer sheets
 
Join Date: Jun 2018
Location: Delmarva
Posts: 95
Print off that Banyan Hill article, so you can look at it on August 2, and then never again believe a hyped-up story like that.


I can look at CNBC every day and see at least one "expert" calling for an imminent crash, while another sees "Dow 40,000 by the end of the year" or whatever. I just try to average them out.
__________________
"I can't complain, but sometimes I still do." - Joe Walsh, Life's Been Good
Crabby Mike is offline   Reply With Quote
Old 07-18-2018, 08:02 AM   #8
Thinks s/he gets paid by the post
38Chevy454's Avatar
 
Join Date: Sep 2013
Location: Cincinnati, OH
Posts: 1,811
I trust historical knowledge. While my crystal ball does not have the clarity to predict tops and bottoms of the market, it does have ability to let me know over long term it will work out in my favor if I stay invested and continue on my plan of AA and widely diversified investments.


I don't react to the various articles. As each day you can find the doom and gloom. I read some for perspective, but it's entertainment mostly.
__________________
After Monday & Tuesday even the calendar says, W-T-F...

Semi-Retired 7/1/16: working part-time (60%) for now [4/24/17 changed to 80%]
Retired Aug 2, 2017; age 53
38Chevy454 is offline   Reply With Quote
Old 07-18-2018, 08:33 AM   #9
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Chuckanut's Avatar
 
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 7,634
From the Banyon Hill article (emphasis added):

Quote:
And when Bauman makes a prediction, he backs it up. True to form, in a new controversial video, Bauman uses over a dozen indisputable charts to prove his point that a 70% stock market crash is here.
Make a note of the name of the writer and the source of this article. If he's right (and you survive), the next time he says something, listen more closely. If he is wrong, make a note of how badly you were misled.
__________________
The worst decisions are usually made in times of anger and impatience.
Chuckanut is offline   Reply With Quote
Old 07-18-2018, 09:01 AM   #10
Thinks s/he gets paid by the post
OldShooter's Avatar
 
Join Date: Mar 2017
Location: City
Posts: 2,144
Dear babe,

Let me give you a couple of viewpoints that explain why most of us ignore the barrage of BS that is inflicted upon the unwary. I would also strongly recomment Nate Silver's book "the signal and the noise," particularly the chapter "How to drown in three feet of water" on the topic of economic forecasting. (If you are not interested in baseball, skip the first three chapters,)

OK, view #1:
Consider thousands of monkeys typing on keyboards and talking in videos, producing the random noise you have detected. These monkeys are slaving for web clicks, hawking advisory services, constantly trying to convince their bosses that they are a valuable monkey, or desperately trying to convince producers that they should be interviewed on-air. When something dramatic happens in the market it is inevitable that some of the monkeys will have predicted it. The most effective self-promoter among these will be crowned "genius monkey" and will stay on that perch until his subsequent failures of prediction become evident. During that time, other self-promoter monkeys are trying to claw their way onto the genius monkey pedestal. This goes on continuously. The statistics of random events also predicts that some monkeys will be right more than once. If you have 10,000 monkeys flipping coins eight times, approximately 40 of them will flip 8 heads in a row. There was a guy at Legg Mason named Bill Miller that filpped heads ten years in a row, consistently beating his benchmark and ascending to the genius monkey level. In the next two years he wiped out completely and lost more money for his investors that he had ever made for them. Statisticians have calculated the probability of one monkey, somewhere, doing this to be about 15%. Miller was the lucky monkey.
... and view #2:
Let us hypothesize that there actually is someone who knows how to reliably beat the market. Do you think that he or she would be stuffing themselves into a suit and commuting to an office building where the windows don't even open? To sell his/her expertise for a pittance to fund investors? To expose the secret sauce so that others can copy it? Of course not. He/she will be found on a tropical island sipping a drink from a glass garnished with an orchid. Every once in a while he/she will replenish the checkbook by making a few trades. The point, of course, is that if such an individual exists he or she will not be found in the cacophony of pundits or in the hordes of dark-suited fund managers desperately hoping to guess right often enough to keep their jobs.
If you liked Nate Silver, try Nassim Taleb's "Fooled by Randomness." His basic tales are of people who, having gotten lucky, conclude from that they are geniuses.
OldShooter is offline   Reply With Quote
Old 07-18-2018, 09:10 AM   #11
Thinks s/he gets paid by the post
 
Join Date: Mar 2011
Posts: 4,771
I tend to trust the market itself. If the Dow doesn't panic by a headline (or quickly recover) neither do I.
__________________
Living well is the best revenge!
Retired @ 52 in 2005
marko is online now   Reply With Quote
Old 07-18-2018, 09:17 AM   #12
Recycles dryer sheets
Lukeee's Avatar
 
Join Date: Feb 2018
Posts: 144
Quote:
Originally Posted by 38Chevy454 View Post
I trust historical knowledge. While my crystal ball does not have the clarity to predict tops and bottoms of the market, it does have ability to let me know over long term it will work out in my favor if I stay invested and continue on my plan of AA and widely diversified investments.


I don't react to the various articles. As each day you can find the doom and gloom. I read some for perspective, but it's entertainment mostly.


+1 here. Trust history.. trust your knowledge and hone your instinct. The markets are very often about psychology rather than facts and a true understand what the markets reward. There are leaders that know what makes a stock move and play that game very well and there are others work on a different strategy. Take Warren Buffet and Elon Musk. 2 very different approaches yet two very effective leaders. They IMO appeal to 2 different kinds strategies to investing.
__________________
Person who will often put his foot in his mouth and not realize it.

2020 or bust!
Or
Perhaps 2021...2022...NVM
Lukeee is offline   Reply With Quote
Old 07-18-2018, 09:19 AM   #13
Thinks s/he gets paid by the post
Koolau's Avatar
 
Join Date: Jul 2008
Location: Leeward Oahu
Posts: 3,389
I've been burned a couple of times in my investing life by believing such articles. It's true that all predictions of coming market collapses are true! We just don't know when. I've learned that the trick is to be set up for whatever comes - and in such a way that you can sleep at night.

Most here have AAs with 50% to 90% stock allocations. Mine is more like 30%. I've lost a lot of money by being such a chicken, BUT I sleep well and I can ignore all the impending-collapse stories. (AND I have "enough.") Last time we had a major correction (2007, right?) I didn't really lose anything. Not just because of my 30% stock allocation but because I had "wisely", heh, heh, invested in PMs a few years earlier. (This was part of the sleep-well-at-night strategy.)

If I'm making a point, it would be that sticking to the time-tested fundamentals of investing (wide diversification, pick-an-AA-and-stick-with-it, have an emergency fund of 6 to 12 months, ignore the financial porn industry, etc.) is still good advice IMHO.

One other idea I've used (on myself) is to run some "what-if" scenarios. What IF there's a 70% pull back? Would I have enough money? If not, maybe I need to rethink my current strategy. If 70% would mean I tighten the belt for a couple of years, I'm good. I've always had the belt, suspenders and elastic waist-band mentality, so I can (for the most part) not worry.

Don't really recommend any of this blather to others, but it seems to work for me. As always, YMMV.
__________________
Ko'olau's Law -

Anything which can be used can be misused. Anything which can be misused will be.
Koolau is offline   Reply With Quote
Old 07-18-2018, 09:48 AM   #14
Thinks s/he gets paid by the post
 
Join Date: Jun 2003
Location: Historic Florida
Posts: 2,344
The video looks on the surface like a marketing presentation.
__________________
"Arguing with an Engineer is like rolling in the mud with a pig. Just remember that the pig likes it."
ShokWaveRider is online now   Reply With Quote
Old 07-18-2018, 09:52 AM   #15
Thinks s/he gets paid by the post
 
Join Date: Aug 2013
Location: North
Posts: 1,346
I largely trust my own experience, the wisdom I've gained from other's along with the practicality of applying that to my own experience and I generally trust my judgement but have been caught off guard. Otherwise I trust no one.
__________________
AA (Stock/Bond/Cash ): 99/0/1% MIX (Small/Mid/Large): 50/25/25% BLEND(US/Foreign): 100/0%, REIT (Real Estate Equity): 50% of Assets

FIRE in 2031 @ 50yrs old (+/- 2yrs) w/ a hypothetical $2.5mil portfolio, 3 appreciated homes worth $1.0mil and rental income to fund my gap years until RMD. Assets will go to an inherited IRA where I plan on watching the investments grow until I die or the trust gets executed.
kgtest is offline   Reply With Quote
Old 07-18-2018, 10:03 AM   #16
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 6,127
1) Have a process that you will follow based on the past historical data. That is all we have to go by, past historical data.



2) Convince yourself that nobody knows the future. The market anticipates via everyone's buys and sells. It reacts to events as they happen (not in the future).
Lsbcal is offline   Reply With Quote
Old 07-18-2018, 10:14 AM   #17
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Apr 2013
Posts: 6,993
I ignore the "experts". They know nothing.
MRG is online now   Reply With Quote
Old 07-18-2018, 10:39 AM   #18
Recycles dryer sheets
 
Join Date: May 2013
Posts: 333
I trust certain authors like John Bogel and Jeremy Seigel for long term investing advice. And both say to ignore headlines and stick with a long term plan.
__________________
F.I. in my 30's, OMYing well into my 40's!
RenoJay is offline   Reply With Quote
Old 07-18-2018, 10:53 AM   #19
Recycles dryer sheets
l2ridehd's Avatar
 
Join Date: Sep 2011
Location: PWC VA
Posts: 141
All the news media is focused on is what happened in the last 30 minutes. They couldn't take a long term view if their life depended on it. And most everything they report in their opinion with very few facts. It's all about getting someone to watch them. Nothing more. They care nothing about reporting accurate information. Our forth estate has become very useless.

So ignore 99% of what they say and do what you would do if you never heard them. As to who I trust? None of them.
l2ridehd is offline   Reply With Quote
Old 07-18-2018, 11:09 AM   #20
Recycles dryer sheets
 
Join Date: Feb 2018
Posts: 99
What’s always mystified me is the pundits put their neck on the line in the name of ad revenue. They have no problem looking silly when they are wrong.

I trust nobody with regard to market predictions because time and time again the market proves nobody can time the market
__________________

Conundrum 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
Qualified Income Trust/Miller Trust tps7742 Other topics 6 09-30-2018 11:44 AM
Has Firecalc ever been wrong for you? Do you trust it 90%? cyber888 FIRE and Money 80 12-06-2015 10:24 AM
Rental property basis in trust vs. not in trust Dash man FIRE and Money 2 04-19-2014 07:20 AM
How can you trust the stock market? Read today's article Cheesehead FIRE and Money 76 10-04-2012 02:19 PM
Where to put cash if you don't trust the market.... HBH FIRE and Money 46 12-19-2006 05:07 PM

» Quick Links

 
All times are GMT -6. The time now is 08:21 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2018, vBulletin Solutions, Inc.