Hang on!!!!!

[VFK57]

I don't see it.

Unlike 08, there is no major financial crisis causing the market panic. This is a crisis of confidence as the result of a multi-year run up in stock prices. By comparison, it "should" reach bottom reasonably soon - but that doesn't mean it won't be ugly.

There is a high level threat of financial crises due to the oil prices dramatic drop. Our oil industry is heavily indebted and with low oil prices they will not be able to repay $$ billions to their lenders, many oil companies cannot even operate at oil prices below $40 per barrel.

 

[REWahoo]

I think the oil price issue, while disruptive, is relatively small potatoes compared to what happened to banking/financial systems in 08.

 

[W2R]

If this turns into a major crash, well, most of us have "been there done that" and know that while it isn't fun, there is money to be made by investing low.

Meanwhile, I am hoping for a "blue light special" on Wall Street today, since I was planning to invest the money I just got from selling my paid off house. My plan is to invest half of it today and DCA the rest.

 

[jetpack]

Not a good idea to try and catch falling knives. I have about 5% in cash that I'm looking to put back in the market when it settles down a bit.

 

[eytonxav]

It goes to show you that W2R is clairvoyant again. I always get a laugh out of this pic:

 

[W2R]

It goes to show you that W2R is clairvoyant again. I always get a laugh out of this pic:

I love that pic! I'm hoping that you are right about me being clairvoyant because my nestegg could use a nice boost after buying my dream house this summer.

Maybe because I am on Social Security this time, with a paid off home as well as lower expenses due to being retired, the idea of a major crash honestly doesn't bother me NEARLY as much as it did in 2008. We'll all be fine. Those of us who have "been there, done that" can remind the others that it isn't the end of the world.

I like having a nice cash cushion to invest during such a crash so I'm all set in that respect.

 

[project2501]

Hey Gents, Ladies, just checking in again and thought I'd post due to recent market numbers. This forum is great for when the sky falls excitement. This is definitely enough dip of 10%+ so can't be as easily ignored.

This time last year actually but wasn't as bad so mostly went unnoticed. S&P was 2019 on 19 SEP 2014. It dipped below 1817 on 16 OCT 2014 to close at 1886.

I'll admit every time it dips hard it looks sketchy. But I'm looking to buy more near bottom. I've a couple funds that rebound hard when it happens so probably squeeze on more there.

Watching for another day or three for the sales event. Keep your sweaty hands dry for the keyboards.

 

[DallasGuy]

It's times like this that makes me glad I only have about 15% of my savings in equities.

 

[audreyh1]

Meh. Wake me when it's 20% off the high. I might need to rebalance...


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Over half way there now!

 

[W2R]

Yikes, the Dow is down 939 points in the first 7 minutes! OK, that's it, I'm pretty excited.

This summer I moved to my "dream home" which (as you probably guessed) is nicer and more expensive than my old house. When you add in the cost of moving, maintaining two houses for a month and a half before closing on the sale of my old house, upgrading some things in my dream home, paying closing costs, and so on, the total cost of this moving escapade came to around $65K.

I'd love to make that much back by buying low! Oh rats, while I wrote this post the Dow rose to where it is only down 662 points.

 

[audreyh1]

I don't see it.

Unlike 08, there is no major financial crisis causing the market panic. This is a crisis of confidence as the result of a multi-year run up in stock prices. By comparison, it "should" reach bottom reasonably soon - but that doesn't mean it won't be ugly.

I think you have it pegged. Sometimes selling begets selling until the players are exhausted.

And maybe investors are so tired of waiting for the Fed to raise interest rates they decided to have a tantrum.

Some big players caught on margin. This and that. But there doesn't seem to be any pending crisis or news to precipitate a big sell off. China has been slowing for years. Oil went bust almost a year ago. Nothing on the Europe front. No new ebola outbreak.

 

[petershk]

Right. Panic selling and forced selling are very different beasts. This seems like a minor panic to me... Not margin calls and infinite deep holes shutting down entire industries.

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[project2501]

I think you have it pegged. Sometimes selling begets selling until the players are exhausted.

And maybe investors are so tired of waiting for the Fed to raise interest rates they decided to have a tantrum.

Some big players caught on margin. This and that. But there doesn't seem to be any pending crisis or news to precipitate a big sell off. China has been slowing for years. Oil went bust almost a year ago. Nothing on the Europe front. No new ebola outbreak.

Exactly what we talked about this time last year in the other "10% correction thread". Oil was tanking and the ebola outbreak happened. China was already decreasing.

Reaches for bag of popcorn....this could be good; finger over buy button!

 

[eytonxav]

I love that pic! I'm hoping that you are right about me being clairvoyant because my nestegg could use a nice boost after buying my dream house this summer.

Maybe because I am on Social Security this time, with a paid off home as well as lower expenses due to being retired, the idea of a major crash honestly doesn't bother me NEARLY as much as it did in 2008. We'll all be fine. Those of us who have "been there, done that" can remind the others that it isn't the end of the world.

I like having a nice cash cushion to invest during such a crash so I'm all set in that respect.

I didn't realize you started SS; I'm still on the fence on when to start. Your situation sounds ideal to me and yes, we've learned the lesson of not to get too nervous over times like this. In 2009, I looked at it as a buying opportunity and we may be at a similar opportunity at this point, although I am going to wait a little while longer. I was tempted at the opening though.

 

[W2R]

I didn't realize you started SS; I'm still on the fence on when to start.

When I reached FRA, I claimed half of my ex-husband's SS. That won't affect what he gets. My own SS will continue to grow until age 70, when I plan to claim it instead.

Your situation sounds ideal to me and yes, we've learned the lesson of not to get too nervous over times like this. In 2009, I looked at it as a buying opportunity and we may be at a similar opportunity at this point, although I am going to wait a little while longer. I was tempted at the opening though.

Yeah, instead of the Dow being down over 1000 (as it was earlier), now it is only down 193. Not as much of a buying opportunity as I had hoped. Oh well. Easy come, easy go.

 

[petershk]

But it did end up down 600. I pushed in a bit of excess cash after the close (I try not to do anything during trading day).

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[VFK57]

I think the oil price issue, while disruptive, is relatively small potatoes compared to what happened to banking/financial systems in 08.

Credit analysts at UBS say there are $1.2 trillion outstanding in loans to the U.S. oil industry!

 

[jetpack]

oil loans sold to "investors".. who took the bait?
Banks Struggle to Unload Oil Loans - WSJ

 

[Chuckanut]

Somebody wake me up when the S&P is down 25% or more. I may do some buying at that time.

Where is a new Luis Rukeyser when we need him?

 

[Helen]

This is the first downturn since I retired almost 2.5 years ago. I have been out enjoying the wilderness too much to even have noticed the downturn until today. We have enough in cash, Ibonds and a variety of other things to worry about this.

Now, back to having fun

 

[explanade]

Saw somewhere that the market went down 5-10% in 2011.

I don't recall that, anyone? Of course I was working then.

 

[audreyh1]

Saw somewhere that the market went down 5-10% in 2011.

I don't recall that, anyone? Of course I was working then.

Yes, I remember - during the year. It was the start of the Euro crisis. S&P500 market index ended up only down fractionally for the year though, essentially flat. Total return on the S&P500 was 2% that year once you included dividends.

You can see a graph here. S&P 500 Unchanged for 2011 - MarketBeat - WSJ

 

[NW-Bound]

On 2011/08/08, the Dow dropped 635 points (only 4 years ago!). The S&P was down 6.7%.

The above is from my diary. I did not note what event prompted it, however.

 

[Running_Man]

I think the bigger item that is about to happen is long term treasury bonds getting hammered. There are just too many countries that are going to be needing funds and instead of treasury bonds being a source of safety they may be a source of funds to shore up local economies.

Stocks could get hammered too, it would be different from 2007-2009 in that bonds from here have great potential for major declines meaning if the same type of fall occurred portfolio damage might be quite a bit larger.

Bloomberg business reporting China selling treasuries and plans to sell more for remainder of year, I am expecting a decent rise in 30 year treasuries somewhere near 4 percent would not be unexpected by early next year.

China Sells U.S. Treasuries to Support Yuan - Bloomberg Business

 

[Dawg52]

Bloomberg business reporting China selling treasuries and plans to sell more for remainder of year, I am expecting a decent rise in 30 year treasuries somewhere near 4 percent would not be unexpected by early next year.

China Sells U.S. Treasuries to SupportÂ*Yuan - Bloomberg Business

I think the bigger item that is about to happen is long term treasury bonds getting hammered. There are just too many countries that are going to be needing funds and instead of treasury bonds being a source of safety they may be a source of funds to shore up local economies.

Stocks could get hammered too, it would be different from 2007-2009 in that bonds from here have great potential for major declines meaning if the same type of fall occurred portfolio damage might be quite a bit larger.

So you're betting that this is just a short term bounce and more blood is on the horizon?