Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 05-19-2016, 12:35 PM   #61
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 19,441
Quote:
Originally Posted by Fedup View Post
I've heard it's around 16. But in 2009, it was outrageous, like 120-70, yet it was time to buy. Is this a reliable signal? I wonder.
In the middle of the Great Recession, P/E temporarily went to hell because there was no E.

Hence, the idea of PE10 to average out the extreme swings.
__________________

__________________
"Old age is the most unexpected of all things that can happen to a man" -- Leon Trotsky
NW-Bound 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 05-19-2016, 12:55 PM   #62
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,525
Quote:
Originally Posted by mathjak107 View Post
I went from jan 2000 to dec2015 since those are the last completed years. The 1.83% real return is with dividends.

That means any older money you had accumulated up until 2000 basically hit a wall. New money did fine but if you had a sizeable balance and went to sleep for 15 years and woke up you would be like what the heck.
That may be for the S&P500, but our net worth from Jan to dec 2015 is up 15% after inflation, taxes and all spending. So it depends on how you were invested (and how much you spent).

It was up over 26% in April 2015, and so gave some back over the rest of the year.

In general, if our net worth after taxes and spending still breaks even with inflation I feel like we're doing great.
__________________

__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is online now   Reply With Quote
Old 05-19-2016, 12:58 PM   #63
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2005
Posts: 5,414
Net worth increasing from adding new money or cutting spending does not change the dismal performance money in equity's saw that was existing pre 2000. Thankfully i did well in real estate after 2000 so i saw decent growth on new money put in the markets.

but money in equity's i already had invested was pretty below average
__________________
mathjak107 is offline   Reply With Quote
Old 05-19-2016, 01:01 PM   #64
Thinks s/he gets paid by the post
Fedup's Avatar
 
Join Date: Mar 2014
Location: Southern Cal
Posts: 2,930
Quote:
Originally Posted by audreyh1 View Post
That may be for the S&P500, but our net worth from Jan to dec 2015 is up 15% after inflation, taxes and all spending. So it depends on how you were invested (and how much you spent).

It was up over 26% in April 2015, and so gave some back over the rest of the year.

In general, if our net worth after taxes and spending still breaks even with inflation I feel like we're doing great.
I think if I remember correctly, you invest 35% in emerging market. Emerging market did well this year.
__________________
Fedup is offline   Reply With Quote
Old 05-19-2016, 04:06 PM   #65
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Gone4Good's Avatar
 
Join Date: Sep 2005
Posts: 5,381
Quote:
Originally Posted by Fedup View Post
I've heard it's around 16. But in 2009, it was outrageous, like 120-70, yet it was time to buy. Is this a reliable signal? I wonder.
I think what you mean is that a PE based on trailing earnings spiked in 2009 because earnings collapsed. CAPE meanwhile fell to around 11x in March 2009 and some of us said at the time that future returns would be higher as a result.

Now those excess future returns have been realized and it's payback time again.
__________________
Retired early, traveling perpetually.
Gone4Good is offline   Reply With Quote
Old 05-19-2016, 04:27 PM   #66
Recycles dryer sheets
 
Join Date: Aug 2013
Posts: 402
up 15% .. nice. what did you invest in ?

Quote:
Originally Posted by audreyh1 View Post
That may be for the S&P500, but our net worth from Jan to dec 2015 is up 15% after inflation, taxes and all spending. So it depends on how you were invested (and how much you spent).

It was up over 26% in April 2015, and so gave some back over the rest of the year.

In general, if our net worth after taxes and spending still breaks even with inflation I feel like we're doing great.
__________________
No to consumerism, Living a simple life, enjoying the experience - not the material stuff
cyber888 is offline   Reply With Quote
Old 05-19-2016, 05:04 PM   #67
Recycles dryer sheets
 
Join Date: Jan 2013
Posts: 69
Quote:
Originally Posted by mathjak107 View Post
[...]any older money you had accumulated up until 2000 basically hit a wall. New money did fine but if you had a sizeable balance and went to sleep for 15 years and woke up you would be like what the heck.
I think this is technically correct but doesn't really tell the full story.

It just so happens that Jan 2000 was a rather pronounced local maximum for the stock market.

Yes, if you measure from that point, returns look dismal, but what if you had gone to sleep in Jul of '02, when the S&P was close to 800? Or what if you fell asleep three years earlier when the S&P also was around 800? The run-up in the tail end of the dot com boom is part of what created that local maximum and needs to be taken into account when considering the return of your "old money".

It's easy to pick points in time to make any story, and I think you said the right thing in another post - it's the individual case that matters and when money gets put into the market.

Ultimately there's a fair amount of guesswork involved in what the actual long-term rate will be - and the idea that this return is constant (even when looked at over 30+ year timeframes) is almost certainly also an oversimplification.
__________________
ulrichw is offline   Reply With Quote
Old 05-19-2016, 05:07 PM   #68
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,525
Quote:
Originally Posted by mathjak107 View Post
Net worth increasing from adding new money or cutting spending does not change the dismal performance money in equity's saw that was existing pre 2000. Thankfully i did well in real estate after 2000 so i saw decent growth on new money put in the markets.

but money in equity's i already had invested was pretty below average
1999 was when I retired, so I often use Jan 1 2000 net worth as the "are we sinking or sailing" benchmark - and IMO it's a really tough one. If I look at August 1999 when I actually retired, the numbers are a good bit better. Given all the concerns about 1999 and 2000 retirees, I am encouraged to see that we are still beating inflation even though we haven't earned any wages since 1999.

Given that our allocation was not 100% equities going in, and that we rebalanced (buying more equities) during down market times, we don't feel bad about the money invested in equities during the period. We were far more broadly diversified than the S&P500.
__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is online now   Reply With Quote
Old 05-19-2016, 05:13 PM   #69
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,525
Quote:
Originally Posted by cyber888 View Post
up 15% .. nice. what did you invest in ?
A whole bunch of different stuff.

What looks like "only" 15% real is 56% nominal, AND 16 years of taxes and living expenses were paid out of that net worth. So we feel pretty good about it in general.
__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is online now   Reply With Quote
Old 05-19-2016, 05:15 PM   #70
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,525
Quote:
Originally Posted by Fedup View Post
I think if I remember correctly, you invest 35% in emerging market. Emerging market did well this year.
No - not me. I have 0% invested in emerging markets, and my portfolio is more or less flat this year (so far).
__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is online now   Reply With Quote
Old 05-19-2016, 05:36 PM   #71
Thinks s/he gets paid by the post
Fedup's Avatar
 
Join Date: Mar 2014
Location: Southern Cal
Posts: 2,930
I certain wish I had discovered ER back in 2009. I was thinking of buying when the Dow was 6000 plus, but my husband talked me out of it because Cramer said it was going to go down to 4000. I at least should take a nibble. My screen name would be RichEnough.
__________________
Fedup is offline   Reply With Quote
Old 05-20-2016, 12:24 AM   #72
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 19,441
Quote:
Originally Posted by Fedup View Post
I think if I remember correctly, you invest 35% in emerging market. Emerging market did well this year.
EM was lousy the first two months of the year, same as the S&P. Then, it bounced back stronger than the S&P, up till mid April. Now it has given it all back, and ends up flat YTD, same as the S&P. All that down, then up, then down. Going nowhere.

The sectors still doing well YTD are natural resources, basic materials, and energy.
__________________
"Old age is the most unexpected of all things that can happen to a man" -- Leon Trotsky
NW-Bound is online now   Reply With Quote
Old 05-20-2016, 03:04 AM   #73
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Gone4Good's Avatar
 
Join Date: Sep 2005
Posts: 5,381
Quote:
Originally Posted by Fedup View Post
I certain wish I had discovered ER back in 2009. I was thinking of buying when the Dow was 6000 plus, but my husband talked me out of it because Cramer said it was going to go down to 4000. I at least should take a nibble. My screen name would be RichEnough.
You'd have found plenty of folks pooping the sheets here just like everywhere else in 2009.

Following forums like this through multiple market cycles provides a front row seat to mass-investor sentiment. After long bull runs the optimists come out and you see plenty of articles about 100% equity allocations and various leveraging strategies to goose returns. Then when stocks cool you get posts like this one. When stocks fall you see people running for the hills.
__________________
Retired early, traveling perpetually.
Gone4Good is offline   Reply With Quote
Old 05-20-2016, 03:16 AM   #74
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2005
Posts: 5,414
Quote:
Originally Posted by ulrichw View Post
I think this is technically correct but doesn't really tell the full story.

It just so happens that Jan 2000 was a rather pronounced local maximum for the stock market.

Yes, if you measure from that point, returns look dismal, but what if you had gone to sleep in Jul of '02, when the S&P was close to 800? Or what if you fell asleep three years earlier when the S&P also was around 800? The run-up in the tail end of the dot com boom is part of what created that local maximum and needs to be taken into account when considering the return of your "old money".

It's easy to pick points in time to make any story, and I think you said the right thing in another post - it's the individual case that matters and when money gets put into the market.

Ultimately there's a fair amount of guesswork involved in what the actual long-term rate will be - and the idea that this return is constant (even when looked at over 30+ year timeframes) is almost certainly also an oversimplification.
which is why i said that you can't judge things hypothetically for all the reasons i listed above . the only time frames that matter are your own .

since i did not have much money invested in the 1980's the great bull did not help me much .

whatever i did manage to accumulate hit a wall in 2000 . the newer money did just fine . today with full fuel tanks i am in my 2nd retirement year and things have been dismal since retiring . .

it is so far the last 2 years that count the most for me .

i was never one to watch random time frames since it really meant little to me .
__________________
mathjak107 is offline   Reply With Quote
Old 05-20-2016, 07:22 AM   #75
Recycles dryer sheets
 
Join Date: Aug 2013
Posts: 402
A whole bunch of different stuff ? Can you give a specific Fund, Stock, Bonds, etc ? Thanks.

Quote:
Originally Posted by audreyh1 View Post
A whole bunch of different stuff.

What looks like "only" 15% real is 56% nominal, AND 16 years of taxes and living expenses were paid out of that net worth. So we feel pretty good about it in general.
__________________
No to consumerism, Living a simple life, enjoying the experience - not the material stuff
cyber888 is offline   Reply With Quote
Old 05-20-2016, 08:40 AM   #76
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,525
Quote:
Originally Posted by cyber888 View Post
A whole bunch of different stuff ? Can you give a specific Fund, Stock, Bonds, etc ? Thanks.
I'm very widely diversified. Mostly mutual funds. Ignoring the most volatile asset classes like high yield bonds, commodities, and emerging markets. A fixed asset allocation around ~55% equities with a modest international exposure. Rebalance as needed.

There was no single magic investment. No point in going into details.
__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is online now   Reply With Quote
Old 05-20-2016, 09:46 AM   #77
Thinks s/he gets paid by the post
Fedup's Avatar
 
Join Date: Mar 2014
Location: Southern Cal
Posts: 2,930
I had to reread some posts. I thought Audrey was up 15% YTD, from Jan to Dec 2015 meant Jan 2015 to Dec2015. I think she meant Jan 2000 to Dec 2015.
Phew, for a minute I thought I did something wrong because I was only up 6-7% last year.
__________________
Fedup is offline   Reply With Quote
Old 05-20-2016, 09:58 AM   #78
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,525
Quote:
Originally Posted by Fedup View Post
I had to reread some posts. I thought Audrey was up 15% YTD, from Jan to Dec 2015 meant Jan 2015 to Dec2015. I think she meant Jan 2000 to Dec 2015.
Phew, for a minute I thought I did something wrong because I was only up 6-7% last year.
Yes, I was talking inflation adjusted growth in net worth over a 16 year time period since retiring. It's not the "return" either as plenty of money was spent over the same time period on taxes and expenses.
__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is online now   Reply With Quote
Old 05-20-2016, 10:18 AM   #79
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 19,441
The "2000" was missing in the original post, so I also took that as the 15% as return for the year 2015. Plus the thread was talking about the last 2 year performance.

I was down last year.
__________________
"Old age is the most unexpected of all things that can happen to a man" -- Leon Trotsky
NW-Bound is online now   Reply With Quote
Old 05-20-2016, 10:26 AM   #80
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,525
Oops - well I was responding to and quoted Mathjak's post where he was clearly discussing the S&P500 performance from Jan 2000 to Dec 2015. And my subsequent posts clarified it.
__________________

__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is online now   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
200k to 250k in a flat market UnrealizedPotential FIRE and Money 15 11-09-2015 11:24 AM
The Coming Market Environment (long) boont FIRE and Money 12 07-16-2008 11:05 AM
S&P flat for 9 years? laurence FIRE and Money 34 06-14-2008 04:11 AM
Top 7 Ways to Tell a Bear Market is Coming........ FinanceDude FIRE and Money 25 10-02-2006 02:17 PM
Market direction for this coming week ? frayne Other topics 28 07-19-2006 11:04 AM

 

 
All times are GMT -6. The time now is 12:07 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.