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Old 08-04-2009, 08:34 PM   #221
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Wow - I really did miss the market rally watching party!

Read the whole thing - quite an interesting stroll through the recent past.

So this is where all the rebalancing is going on.

Audrey
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Old 08-04-2009, 09:53 PM   #222
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Wow - I really did miss the market rally watching party!

Read the whole thing - quite an interesting stroll through the recent past.

So this is where all the rebalancing is going on.

Audrey
Despite all the self-proclaimed affinity to Bogle's philosophy, there's always a market timer inside every investor, itching to click on "buy" or "sell". Come on over to the dark side.

Yes, market timing can be fun if one does it the "clean" way, not the "dirty" way. Remember that we are all "rebalancing" and not "trading".
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Old 08-05-2009, 06:39 AM   #223
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Despite all the self-proclaimed affinity to Bogle's philosophy, there's always a market timer inside every investor, itching to click on "buy" or "sell". Come on over to the dark side.

Yes, market timing can be fun if one does it the "clean" way, not the "dirty" way. Remember that we are all "rebalancing" and not "trading".
There is a small group of us who like watching the market from the sidelines, cheering or groaning ! One can "Whee!!" to one's heart's content and be happy and ecstatic about market conditions without doing anything whatsoever. I know I haven't. I am still thrilled with the market recovery.

Rebalancing - - ah yes, that can be tricky if you let emotions enter the picture. Still, I would imagine that rebalancing according to objective guidelines that we have written down is still Bogle-ish since I don't recall where he would say not to have an asset allocation. Don't remember where I read the suggestion to write down my financial plan, but it does help.

Of course, nobody's perfect and the subjective can sometimes enter the picture, as happened for those of us who did *not* rebalance in March despite their criteria for rebalancing being surpassed. (There is no emoticon for it, but here you can imagine the "See no evil, speak no evil, hear no evil" monkeys as we try to pretend we didn't really SEE the market going that low on March 9th.). I am pretty sure that that kind of paralysis is not approved. This is where UncleMick's Target Retirement funds shine - - they are rebalanced for you, no matter what emotions one may have.
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Old 08-05-2009, 08:51 AM   #224
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YEAH! What She Said!

Those of us who had a plan that said we had to rebalance if portfolio got X% out of whack (in either direction), track portfolio on a spreadsheet, portfolio reaches that criteria - you gotta rebalance!

Did it on the way down. Now doing it on the way up.

Audrey
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Old 08-05-2009, 09:12 AM   #225
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(There is no emoticon for it, but here you can imagine the "See no evil, speak no evil, hear no evil" monkeys as we try to pretend we didn't really SEE the market going that low on March 9th.).
You didn't look hard enough...
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Old 08-05-2009, 09:37 AM   #226
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Well, I was just teasing. There is a lot of Bogle's sayings that I heed. The most important thing is to not churn your portfolio. It must be given time to work. There might be some people who are good at daytrading, but I could never figure out the short-term movements of a particular stock.

On the other hand, if one takes everything or anything he said as dogma...

I remember once reading Bogle's advice that one only needs to look at her portfolio once a year. Perhaps that was OK 20 or 30 years ago, but nowadays with the market volality we have seen, one would miss the trading, er rebalancing, opportunity of a lifetime. Well, it will come again and again a few more times in my remaining lifetime, I am afraid. So, I keep my eyes peeled to fine tune my trading, er rebalancing skills.
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Old 08-05-2009, 10:49 AM   #227
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Well, I don't use a crystal ball; I use tea leaves.

I'm happy that the market is up. I'm 55% in equities and pleased to see some improvement.

But history is a harsh teacher sometimes and in 1933 the stock market went up 172% and lasted 249 days. You know what happened after that. Fundamentals are important. From what I can see in my tea leaves, the only thing propping up this economy is government stimulus. That can't last forever.

So get out there and spend like it's 2006!
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Old 08-05-2009, 11:18 AM   #228
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You crystal ball and tea leaves folks are pikers! Chicken entrails is the only way to go.
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Well, I don't use a crystal ball; I use tea leaves.

....

But history is a harsh teacher sometimes and in 1933 the stock market went up 172% and lasted 249 days. You know what happened after that. Fundamentals are important. From what I can see in my tea leaves, the only thing propping up this economy is government stimulus. That can't last forever.
I take a little solace in the belief that we are not going to repeat 1932. Conventional wisdom seems to be that in 1932 the government blinked, became frightened of the mounting deficits and tried to balance the budget. Whatever blunders today's economists in Washington might make, they are not about to repeat that mistake.

You are right: government subsidies can't last forever. I wonder just how much money Uncle Sam can borrow. I don't think we are anywhere near WWII debt levels yet. OTOH, that may be a bad comparison. Everything might now depend on the the willingness of the Chinese and Indians to by U.S. bonds.
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Old 08-05-2009, 11:27 AM   #229
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I remember once reading Bogle's advice that one only needs to look at her portfolio once a year. Perhaps that was OK 20 or 30 years ago, but nowadays with the market volality we have seen, one would miss the trading, er rebalancing, opportunity of a lifetime. Well, it will come again and again a few more times in my remaining lifetime, I am afraid. So, I keep my eyes peeled to fine tune my trading, er rebalancing skills.
I think this recommendation comes because Bogle wants to prevent people from panic selling at the lows. If they only look at their portfolio once a year, they minimize this reaction.

After all, how many of us suffered some sort of paralysis during the downturn?

Fortunately, most of us only experienced paralysis and the luckier ones, some opportunistic rebalancing. Few it appears sold. But people were selling, or else the market wouldn't have gone down. And based on how much it went down, there was a helluvalot of selling.
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Old 08-05-2009, 11:33 AM   #230
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It's most likely we are not having Great Depression II. In fact, I saw in BW (or is it Time) a columnist already coined the term Great Recession to call this one. The gummint will not make the same mistake. It will make a new one. This is OK, as it agrees with my principles. Why repeat the same mistakes, while the possibilities of new ones are endless?

I am looking to the East. Other countries' living standards are so low compared to ours, and they can grow. How do we grow? When I bought my home in 1989, at 2400sqft (later remodeled to 2800), it was the largest anyone ever owned in my extended family. In 2007, 2400sqft is the average size of new homes being built. My younger brothers' houses dwarfed mine. Pray tell me, where do we go from here? Mc Mansions of 4000 sqft and cars with V-10 engine for everybody? Where's the growth?

I am holding and keeping stocks of US multinational companies and also foreign stocks. It's my story, and I am sticking to it for now (but if I turn out to be wrong in a year or two, I will not be hard-headed about it).
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Old 08-05-2009, 11:37 AM   #231
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I think this recommendation comes because Bogle wants to prevent people from panic selling at the lows. If they only look at their portfolio once a year, they minimize this reaction.

After all, how many of us suffered some sort of paralysis during the downturn?

Fortunately, most of us only experienced paralysis and the luckier ones, some opportunistic rebalancing. Few it appears sold. But people were selling, or else the market wouldn't have gone down. And based on how much it went down, there was a helluvalot of selling.
Yes, I would say that listening to Bogle would give an investor a better fate than to join the stampede.

But as always, it is better to understand the true meaning of the words than to take them literally. As a great philosopher once said "When I point to the moon, do you look at the moon or do you look at my finger?".
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Old 08-05-2009, 12:41 PM   #232
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You didn't look hard enough...
Perfect!! <~~~ THAT's what some of us were doing on March 9th.
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Old 08-05-2009, 01:36 PM   #233
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... Everything might now depend on the the willingness of the Chinese and Indians to by U.S. bonds.
The Chinese are wising up. They can't dump US bonds without hurting themselves. However, they are looking to buy more private and hard assets. Recently, I have read that there will be more takeovers like Lenovo buying IBM laptop business a few years ago.
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Old 08-05-2009, 02:32 PM   #234
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The Chinese are wising up. They can't dump US bonds without hurting themselves. However, they are looking to buy more private and hard assets. Recently, I have read that there will be more takeovers like Lenovo buying IBM laptop business a few years ago.
The investment cycle is interesting. Lenovo buys up IBM personal computer division, calls it Lenovo now, and many of the former IBM facilities in my county are now Lenovo, with all the same people still working there for the most part. I just ordered a laptop bag from them recently, and was surprised that this "chinese company" shipped it to me from their international warehouse no more than 40 miles up the road.

And here we are, in the US, snapping up emerging markets mutual funds, such as Vanguard's VEIEX, which owns Lenovo as one of its portfolio holdings.

In a way it is an example of a locally owned local company, at least for me.
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Old 08-05-2009, 02:34 PM   #235
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Despite all the self-proclaimed affinity to Bogle's philosophy, there's always a market timer inside every investor, itching to click on "buy" or "sell". Come on over to the dark side.

Yes, market timing can be fun if one does it the "clean" way, not the "dirty" way. Remember that we are all "rebalancing" and not "trading".
Buy and hold is soooo last year!
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Old 08-06-2009, 09:04 PM   #236
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The Chinese are wising up. They can't dump US bonds without hurting themselves. However, they are looking to buy more private and hard assets. Recently, I have read that there will be more takeovers like Lenovo buying IBM laptop business a few years ago.
Wellll - I hope they do a better job than the Japanese (late 80's) when they were going to buy America and really show us how an economy should be run.

I did like the Sean Connery murder mystery(Rising Sun 1993) though.

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Old 08-06-2009, 09:17 PM   #237
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Yes, the Japanese did lose their shirts buying American real estate.

However, they did have some successes in other areas, or making inroad into the US markets, such as cars, electronics, etc... Now, in these areas the Japanese are losing out to the Korean and the Chinese too, it seems.
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Old 08-08-2009, 07:10 AM   #238
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Sure got quiet on this thread!

What? Did everyone decide this rally really was for real? No more discussion needed?

My technical analysis buddies note that all the various 50/200 daily moving averages on various index charts have made definite crossovers on the upside. This is usually a long-term very bullish sign.

Of course, I already rebalanced and thus took some profits - early as usual, but I don't care.

Audrey
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Old 08-08-2009, 08:40 AM   #239
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Sure got quiet on this thread!

What? Did everyone decide this rally really was for real? No more discussion needed?
Either it is for real, or I am dreaming. If it's the latter, please don't awaken me!

This rally is a dream come true and I really didn't expect it this close to my ER date. My ER plans have always assumed a market crash and massive inflation coinciding with ER. Instead, we had a market crash and real estate crash, but may have neither by my ER in November.

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My technical analysis buddies note that all the various 50/200 daily moving averages on various index charts have made definite crossovers on the upside. This is usually a long-term very bullish sign.
That's very encouraging! Let's hope they are right. My crystal ball says that we will have ups and downs, but that we have seen the worst of it.

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Of course, I already rebalanced and thus took some profits - early as usual, but I don't care.
I think that is wonderful and rebalancing is the right thing to do, if/when needed. You can always do it again when your criteria are once again exceeded on the way up.
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Old 08-08-2009, 09:05 AM   #240
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I think that is wonderful and rebalancing is the right thing to do, if/when needed. You can always do it again when your criteria are once again exceeded on the way up.
Exactly! If this rally is as powerful and goes far as my TA buddies seem to believe, I may indeed get to rebalance again due to exceeded allocation limits on the upside (knock on wood!!!!!!). Otherwise, I did get to rebalance and take some of the profits! Either way - whatever.

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