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Old 03-12-2016, 07:16 AM   #61
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. . . but only earned about $1,000 per year.
But the house was appraised at more than twice the $12K at the time. He essentially picked up the outstanding mortgage; much to the bank's pleasure.
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Old 03-12-2016, 09:44 AM   #62
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Been thinking about the market and what's been transpiring. I'm not a market historian but it feels like we can draw some parallels to 1932 and we all know that was a dead market for the next 15 years, til the end of WW2. Fed raised too quickly after the big crash... sent the economy into a stagnant state til the end of the war. War didnt help, of course, but could we be on the verge (as Bogle suggests) of very anemic (or even negative REAL) returns for the next decade?

Ben B was at least well schooled and studied this time period. Janet less so....

Thinking of sequence of returns risks... Anyway, just wonder if we have any economists or historians (or those who might have lived through it...ya never know) who studied that period of time indepth that can share parallels and/or perpendiculars...

I don't believe the depression era leaders had any macroeconomic tools or even solid theory to work from, the way we do today. Gold standard severely severely severely limited what could be done on the supply side.


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Old 03-12-2016, 10:25 AM   #63
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After looking at that chart...The dog and I buried all our investments in the back yard. Is it time to dig it up, now?

I just thought I would revive this thread with a little sarcasm. The sky is falling sells magazines.

Whew! I was worried until I noticed this was a graph of the DJIA.
No worries. I don't invest in the Dow /sarcasm
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Old 03-12-2016, 10:50 AM   #64
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Perhaps part of the confusion is that the title of your post should have been "Is this Market Like 1937." That makes more sense to me, keeping in mind that the aftermath of 2008/2009 was nothing like that of 1928/29 because the response by government's world wide was much, much better.

We do, surprisingly enough, learn from history (well, at least institutions like the Fed do.)

Which also leads us to the reasonable possibility that the Fed will not blindly keep tightening monetary policy in the face of all evidence in 2016 and beyond. Thus far they've raised rates by 0.0025 and are not honor bound to raise any more. Futures markets have dramatically cut the odds of another Fed increase.

If inflation continues to be a no-show and the labor market softens, I'd say the Fed tightening will be "one and done."
Well, we haven't enacted any crippling tariffs or any started trade wars like they did in 1930 -- yet.
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Old 03-13-2016, 10:31 AM   #65
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OTOH, in 1932 my grandfather was able to buy a foreclosed 6 bedroom oceanfront home for $12,000.

Problem/Opportunity
+1. My dear great grandfather (DGGF?) was born on a farm but later had a pharmacy in rural GA and used the profits to come out of the Depression with 6,000 acres of timberland. The rest of the story is that he turned down an opportunity to buy Coca Cola stock from a salesman from Atlanta because land was more useful than some flavored carbonated water drink company, and what fool would waste good money on that?
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Old 03-14-2016, 05:06 AM   #66
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To be fair turning down a slick (traveling?) salesman from the big city peddling stock is a very good decision rule to live by

And farmland returns aren't too shabby it seems (random google):
https://www.extension.iastate.edu/ag.../EdwMay10.html
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Is this market like 1932 ?
Old 03-14-2016, 01:03 PM   #67
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Is this market like 1932 ?

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To be fair turning down a slick (traveling?) salesman from the big city peddling stock is a very good decision rule to live by

And farmland returns aren't too shabby it seems (random google):
https://www.extension.iastate.edu/ag.../EdwMay10.html
Interesting article. Not to get us even further off-topic but, interestingly, professional pine forest managers on the SE coastal plain often aim for about a 4% sustainable annual return to landowners, i.e. just like farming stock/bond portfolios for a SWR! :-)
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Old 03-21-2016, 12:02 PM   #68
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The attached article is rather interesting and gets us back on topic:

Stocks are catching spring fever. The Dow Jones industrial average and S&P 500 officially wiped out their year-to-date losses this week, as the weight of the Fed was lifted from investors' shoulders. If the Dow can hold its gains through the end of the month, it would mark the biggest quarterly comeback since 1933.



Of course...we all know what happened next ...



The Dow is doing something it hasn't done since 1933
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Old 03-31-2016, 06:49 AM   #69
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One more as we close out Q1 today.

The Dow is poised to close out the first three months of the year in the green, after the worst start ever to a year. The Dow's quarterly comeback was its biggest reversal since 1933. (CNBC)

Pretty fascinating. I'm no macro economist but I wonder what other parallels we will see going forward.

The market reversal and similarities to 1932 (ok 1933) certainly lend some pause for thought
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Old 03-31-2016, 10:35 AM   #70
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The market reversal and similarities to 1932 (ok 1933) certainly lend some pause for thought
Why? Why would today's huge, complicated, insanely fast market have any relation whatsoever to the 1930's market?
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Old 03-31-2016, 10:51 AM   #71
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The market reversal and similarities to 1932 (ok 1933) certainly lend some pause for thought
So what exactly do you see between these two markets that looks similar to you?
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Old 03-31-2016, 11:17 AM   #72
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For me, given that markets contain a human element and humans tend to repeat their behaviors, I suppose it's the behavioral finance aspect of market crashes and market rallies that are interesting to me.
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Old 03-31-2016, 11:29 AM   #73
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So what exactly do you see between these two markets that looks similar to you?
The lines seem to go from Left to Right?
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Old 03-31-2016, 11:32 AM   #74
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The lines seem to go from Left to Right?
Markets go up, markets go down and sometimes crashes happen?
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Old 03-31-2016, 02:23 PM   #75
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Why would today's huge, complicated, insanely fast market have any relation whatsoever to the 1930's market?
It wouldn't. Human brains have a tendency to look for patterns in data. This was apparently good for our ancestors toward finding food, but gets us in a lot of trouble with our investments now. I recommend Your Money and Your Brain by Jason Zweig.
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Old 03-31-2016, 02:36 PM   #76
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http://blogs.wsj.com/moneybeat/2015/...son-for-stocks.

Billionaire hedge-fund manager Ray Dalio outlined parallels between 1937 and the current market in a letter in March, listing a series of events that began in the late 1920s that correlate to what’s been happening in the market since the financial crisis. Now, other investors are pointing to the same similarities.

Perhaps just pattern recognition. Perhaps not.
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Old 03-31-2016, 02:53 PM   #77
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Why 2015 Might Be Like 1937 for Stocks - MoneyBeat - WSJ.

Billionaire hedge-fund manager Ray Dalio outlined parallels between 1937 and the current market . . .

I'll read the article but before I do let me just recap the history of this thread you started with the title "is this market like 1932?"

You recently revived the thread by moving the date to 1933. And in your most recent comment its 1937.

But when I said this . . .

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Perhaps part of the confusion is that the title of your post should have been "Is this Market Like 1937." That makes more sense to me, . . .
You responded thusly . . .

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Well. I did mean 1932.....
So if you're asking whether I see similarities between markets of ever-changing time frames with seemingly arbitrary starting dates I admit that I don't.

I do however see tenuous parallels between now and 1937 but only in that there was fear that the Fed might tighten too aggressively and prematurely cut off recovery this time, as they did then. But last time monetary policy was hugely influenced by a gold standard that no longer exists today. And also the Fed has learned something since then, as evidence by the current go-slow approach and the fact that the Fed waited until unemployment got below 5% to start tightening this time rather than above 14% as it was in 1937.
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Is this market like 1932 ?
Old 03-31-2016, 04:05 PM   #78
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Is this market like 1932 ?

No need to re-cap. We can all read here. We can also agree to disagree !

No need to get snarky either ..
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Old 03-31-2016, 04:13 PM   #79
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Why? Why would today's huge, complicated, insanely fast market have any relation whatsoever to the 1930's market?

My premise is that humans have not evolved much in the past 90 years.....20,000 years yes...but not 90 years and so the human element of the market , despite all the technology, interconnectedness, and global growth, is the same and just can not be ignored.

Patterns repeat. Behaviors repeat.
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Old 03-31-2016, 04:13 PM   #80
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No need to get snarky either ..
Even if it's a good snark?
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