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Old 07-22-2009, 09:25 AM   #161
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I'm not particularly optimistic, and I still see problems, especially too much debt: gumment, corporate, and consumer. Lots of excess inventory, but mostly in real estate. I think most corporations are lean and mean in that regard. "Structural" unemployment is probably 4-6% (swag), so everything above that is "real"... heh, heh

Edited to add: There's a lot of cash out there looking for yield...
True, and these two things seem to be competing against each other for investment capital where equities are concerned; the former suggests "sell" and the latter suggests "buy" to some.

I've been noticing in the last few months that more and more people are sick and tired of earning 1% or less in cash and are starting to become more willing to put some at risk in order for higher expected return. I think that's at least some of the bounce in the markets since March -- that and the increasing belief that even if the economy still sucks, we averted the potential meltdown of the entire financial system that looked very possible 6-9 months ago.

But yeah, there are a lot of structural problems, and even though I think a mild recovery (or at least stabilization) is underway I don't see any catalyst for a major upswing in demand for "stuff". Perhaps some people are hoping that even if stocks flatline for a couple of years, dividend yields are higher than returns on cash. So I see no significant catalyst to continue stocks on the upswing, but as I mentioned earlier, even if they thrash and flatline for a while, dividend yields are higher than cash and eventually demand will recover, bringing stocks back with it.
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Old 07-22-2009, 10:04 AM   #162
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I think this has the clear signs of a sucker rally.......
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Old 07-22-2009, 11:53 AM   #163
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Why the sad face? If that's your belief, place your bet accordingly and you would do well.

In a way, FD is right! The S&P first reached the 900 levels in Nov 1997, proceeded to exceed 1500 in Aug 2000, before retreating back to 800 level in Sep 2002. It then climbed back to the 1500 level in Oct 2007, dropped below 700 in March this year, and ended back to the 900 level now.

So, surely, recently there was a long "sucker rally" from Nov 97 to Aug 2000, and another one from Sep 2002 to Oct 2007. A 3-yr sucker rally, and another 5-yr long. How long is this sucker rally going to last?
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Old 07-22-2009, 04:26 PM   #164
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Why the sad face? If that's your belief, place your bet accordingly and you would do well.

In a way, FD is right! The S&P first reached the 900 levels in Nov 1997, proceeded to exceed 1500 in Aug 2000, before retreating back to 800 level in Sep 2002. It then climbed back to the 1500 level in Oct 2007, dropped below 700 in March this year, and ended back to the 900 level now.

So, surely, recently there was a long "sucker rally" from Nov 97 to Aug 2000, and another one from Sep 2002 to Oct 2007. A 3-yr sucker rally, and another 5-yr long. How long is this sucker rally going to last?
I understand the press of your question. However, today's economic, business and geopolitical situation is probably overall quite a bit worse. I at least am not expecting another run to 1500 any time soon.

Ha
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Old 07-22-2009, 06:20 PM   #165
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By investing aggressively in late 2008 - early 2009, we were able to recoup much of our losses from the past 18 months. But I no longer feel as bullish as I did a few month ago. I like where our portfolio is right now and I have decided to keep our AA around 50/50. I am very ambivalent about the current situation and I think that prudence is probably the best course of action.
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Old 07-22-2009, 10:11 PM   #166
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I don't usually check the numbers until the end of the month but I checked yesterday's numbers and everything I own was up, both stocks and bonds. The last time I noticed that the DOW was hovering in the mid-13,000s. I'm not saying that hasn't happened other times, I just happened to notice it then and now and for some reason it scared me both times.
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Old 07-23-2009, 06:44 AM   #167
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I also went pretty aggressive to recoup my losses . I am pretty close to my goal so I'll soon re balance down to 60/40.
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Old 07-23-2009, 09:48 AM   #168
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Wheee!!!! Dow over 9000 at the moment.

I don't even *care* if it is a sucker's rally. This is so cool!! Recession? WHAT recession? (just kiddin' around)
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Old 07-23-2009, 09:52 AM   #169
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Oh my! Here we go again.
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Old 07-23-2009, 09:54 AM   #170
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I'm not normally much of a dirty market timer, but it's really starting to feel like it's time to take a little off the table...

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Wheee!!!! Dow over 9000 at the moment.
Uh-oh. SELL!!!!!
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Old 07-23-2009, 10:02 AM   #171
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Well, I have around 100 stock positions, and they are all up at this moment except 3.

Soooo, which ones do I sell? The ones that W2R holds?
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Old 07-23-2009, 10:09 AM   #172
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Everyone is going to do the dow 9000 dance, maybe get a little exuberant and then we'll just be back to TheSweetLife's down 20%. Or is it 25% now?

Seriously, it is kinda scary looking at the chart since July 10. 13 days and we are up 11% already. 9 business days of gains every day. I guess we had similar charts on the way down back in late 2008 and early 2009. Eventually it will level off, maybe go down.

I had to LOL at the dow jones index page at yahoo finance. The two top headlines are "Dow 10,000 by end of year" and "Dow 15,000 here we come!". If that isn't a sell indicator, I don't know what is! Where were these prognosticators on March 6 at dow 6,400?
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Old 07-23-2009, 10:12 AM   #173
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Seriously, it is kinda scary looking at the chart since July 10. 13 days and we are up 11% already. 9 business days of gains every day. I guess we had similar charts on the way down back in late 2008 and early 2009. Eventually it will level off, maybe go down.
I heard yesterday that the Nasdaq has been up for 11 straight days (working on a 12th now unless we sell off). That hasn't happened since the tech bubble days of 1998, apparently...
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Old 07-23-2009, 10:15 AM   #174
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How about the times the market went down for weeks straight?

Isn't it fair that investors get compensated for that now?
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Old 07-23-2009, 10:20 AM   #175
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Don't mind me but if some of us sell now, it again will be the bears and he bulls duking it out, stocks up/down, up/down and on and on. It still looks like a buying opportunity to me, with the DOW under 10,000 and the S&P under 1000.

Yes, I could go ahead and but I'm holding.
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Old 07-23-2009, 10:26 AM   #176
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Well, I have around 100 stock positions, and they are all up at this moment except 3.

Soooo, which ones do I sell? The ones that W2R holds?
For your convenience, the funds I hold that include equities would be
VTSAX (Vanguard Total Stock Market Index)
VWIAX (Vanguard Wellesley Income Fund)
VFWIX (Vanguard FTSE All-World Ex-US Index Fund)

and a tiny bit of
VWNDX (Vanguard Windsor Fund)
VEIEX (Vanguard Emerging Markets)

I have no individual stock holdings at present.

Helpfully yours,

.......W2R (Wheee!!! We're all gonna make out like bandits this year!)
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Old 07-23-2009, 10:33 AM   #177
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Darn! I do not want to short entire markets, seeing that you only hold broad-based MFs.

Sooo, I will continue to hold the stocks I have which are, in my naive opinion, better than the broad markets.

There! I will measure myself against your MFs later. The race is on!
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Old 07-23-2009, 12:14 PM   #178
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I understand the press of your question. However, today's economic, business and geopolitical situation is probably overall quite a bit worse. I at least am not expecting another run to 1500 any time soon.
Ha
As described in my earlier post, it took the S&P 5 years to climb from 2003 low back to where it was in 2000. This time may be even longer. Who knows? And then, even if the S&P comes back to that level, it might be with other sectors leading, not the financials that will not reclaim their 30% presence. In fact, many financials have disappeared by bankruptcy or M&A, and they were the high-flyers in the S&P in 2007, similar to the dot-coms and tech stocks that propelled the NASDAQ to nose-bleed altitude in 2000.

But even so, there are several non-glamorous companies that are profitable, paying dividends that exceed the paltry interest rate now, and faced with better times ahead (meaning next quarter to next year). Until their conditions change, I will continue to hold them. That's all I can do, using the info I have at the present time.
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Old 07-23-2009, 12:24 PM   #179
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But even so, there are several non-glamorous companies that are profitable, paying dividends that exceed the paltry interest rate now, and faced with better times ahead (meaning next quarter to next year). Until their conditions change, I will continue to hold them. That's all I can do, using the info I have at the present time.
True. Some of them are in relatively stable and recession-resistant sectors, are rock-solid businesses that aren't going anywhere soon and pay 3-5% in dividends.

For truly long-term money, I don't see how this can be a worse deal than CDs earning 1-2% or money market funds paying 0.5% if that.
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RIP to Reemy, my avatar dog (2003 - 9/16/2017)
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Old 07-26-2009, 01:45 PM   #180
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This latest two week runup has made no sense. Before that, we had a 10% correction which I had been waiting awhile for and that made sense to me as I do believe the market got way ahead of itself. I wanted to see things get a bit cheaper and then start buying. Lo and behold the market took off. Oil had gone from 74 down to 58 and now it's back to 68ish. Can anyone explain this? The longer I'm invested the more I truly believe that this is like a casino in the short term. My only hope is that in the long term this is not a huge fool's game. Having said all that, I do believe we will be lower than current levels at the end of the year by about 15%.
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