Stock Market Woes

[Danny]

Deeper than this.

Send me a message when the time comes. Thanks.

 

[LovesLife]

The diversification in my port didn't do squat. VG total international was down-2.68% and EM was down -1.45%. Oh well. I'm still sitting on some cash, too, and about 6 years of living expenses in CD's. It's still kind of painful to watch though.

 

[laurence]

Me, I'm buying, I'm years (and years) from retirement, so I'm not sweating it, but those of you who are retired, even with all your vast knowledge of how the markets work, and historical testing with Firecalc, must find these times a little trying. Heck, if you have a $1,000,000 portfolio and the market dropped 4% this week, you just watched 40k disapear, a year's SWR down the tubes!

 

[d]

How about a bit more perspective?  It was obviously not a good day for stocks, but one day does not a market make.  For the more "active" portion of my portfolio I'm showing:

today: -1.70%
1 wk: -3.31%
1 mo: +.44%
3 mo: +2.52%
12 mo: +21.43%

could be a buying opportunity! ( or maybe not yet? )

 

[wabmester]

Hey wab - remember when I told you to buy 5,000 shares of Target at 54.50?
You ignored me of course.....didn't you....? 

I think now is definitely a good time! 

Well, I didn't completely ignore you.   I at least looked at their numbers.   It does look a bit better now, but still not cheap.   WMT looks about the same or better.   Which do you think will do better in the coming recession?

I liked the recent news about WMT -- the rising Yuan was putting pressure on the margins of their Chinese suppliers, so they asked WMT if they could raise their prices.   WMT said no.  

 

[shiny]

My GTC order for the Emerging Market "Viper" (VWO) executed this morning then promptly went down. I'll probably regret it, but I wanted some exposure to Emerging Markets and set the price 8% below last week's high.

 

[haha]

These past few days have made me feel better about carrying puts. We'll see going forward, but if things continue in this vein I will soon roll down a strike and take a nice bit of change out. My remaining oil shares have taken a big hit. However, when it comes to oil I am a lifer, so I don't want to distract myself with a lot of trading attempts. Near term prices will be volatile. Long term, we will be paying more for crude.

IMHO, of course. 

Ha

 

[Ed_The_Gypsy]

However, when it comes to oil I am a lifer, so I don't want to distract myself with a lot of trading attempts. Near term prices will be volatile. Long term, we will be paying more for crude.

 

[modlair]

get a grip ... the S&P is down by about 4% from recent highs, and still positive YTD. Hardly a blood bath

Look at what that says. Down 4%, but still up for the year, though not by much.

In other words, the S&P was up only about 5% YTD. What has happened to perspective that 5% has become irrational exuberance? It's only 5%. Last year was 5% so it's not like that is tacked onto a 30% 2005 year. It's a total of 10ish% over 17 months what we really want to call an absurd bubble?

It's mostly random and none of this means anything, but what are people thinking when, after the enormous numbers of the 90's, these kinds of numbers look scary high?

 

[haha]

Ed, I can't decode your message. But whether you agree or disagree, an interesting take on volatility in crude prices comes from Emeritus Professor of Geology at Princeton, Ken Deffeyes. He asserts that volatility (up and down) is characteristic of physical systems nearing capacity. And that we might expect violent upward and downward price perturbations as the production cushion gets more and more strained.

Anyway, that’s my story, and I’m sticking to it. 

Ha

 

[Danny]

... WMT looks about the same or better. Which do you think will do better in the coming recession?

TGT will outperform WMT from now on recession or not. You have my persoanal guarantee!

 

[wabmester]

an interesting take on volatility in crude prices comes from Emeritus Professor of Geology at Princeton, Ken Deffeyes. He asserts that volatility (up and down) is characteristic of physical systems nearing capacity. And that we might expect violent upward and downward price perturbations as the production cushion gets more and more strained.

Take it from Professor Wab. Volatility is a characteristic of speculative traders. Remember the manipulation of energy prices by Enron et al? Where do you think those guys all went? Hint: they didn't ER.

 

[youbet]

Patience, youbet.  It'll stop in a few days weeks months years 

OK.......... I think..........  Hey, I promised myself I wouldn't retire into a down market, and I'm retiring in seven weeks!   

I guess having the first three years in cash might turn out to be a good thing!!   

Now, back to reading about early season walleyes.........

 

[Ed_The_Gypsy]

Ha,

What you said.

I don't know much market theory, but I do know that the cheap oil is being used up and the supply is limited. Consequently, the supply curve has a steep slope--inelastic--and demand can only increase. There will be high-cost producers and low-cost producers, and they will all sell oil and its products at the same prices. Entry into the market is restricted, as it is highly capital-intensive and requires huge investments and manpower to get in, and the old boys who got in early and cheap should do well. Somebody is going to make a lot of money and we should buy their stocks.

A small part of my investments are in oil and other commodities through mutual funds, but my occupation (today) is in the oil industry in a growth area. I am betting on oil. I have worked in a declining profession in declining industries and like Mae West said, "I've been rich and I've been poor, and believe me: rich is better."

Then, I may retire in Venezuela and pay 13 cents a gallon for gasoline.

Ed

 

[wanderer69]

Hint: they didn't ER.

What happened to Lou Pai and the executive who ran Enron Int'l (her name escapes me).  I thought they sold out at the all time high and emerged unscathed.

Or maybe you are referring to the traders - I believe many of them were nailed...

 

[Nords]

What happened to Lou Pai and the executive who ran Enron Int'l (her name escapes me).  I thought they sold out at the all time high and emerged unscathed.
Or maybe you are referring to the traders - I believe many of them were nailed...

Lou Pai (a very busy guy): http://en.wikipedia.org/wiki/Lou_Pai
Rebecca Mark: http://www.fastcompany.com/magazine/74/enron_mark.html

Neither one came off very well with Kurt Eichenwald or Roger Lowenstein...

 

[retire@40]

I'm actually proud of myself for not getting panicky with this recent drop.  I don't know what today's little fiasco has cost me, but as of yesterday I figure I was down about $10,000 from my peak, which I hit last week.

Days like these bring reality to what you think your risk tolerance is.  If you start to lose sleep over your losses, it just means you are taking more risk than you thought you could handle.

I'm down over $30K from my peak and I'm sure there are others here that are down double that.  I don't know how much more it would have to drop to get the sweat glands activated, but I'm not there yet.  Then again, I'm not fully retired, so I'm not completely depending on a SWR just yet. That keeps me sleeping like a baby for now.

 

[modlair]

The market teaches people something important.

One does NOT have control of when one does something that depends on money. One has control of doing that something conditional on circumstance, not conditional on time.

Meaning, the market has a lot of control of our lives and that's just the way it is.

 

[Danny]

OK.......... I think.......... Hey, I promised myself I wouldn't retire into a down market, and I'm retiring in seven weeks!

I guess having the first three years in cash might turn out to be a good thing!!

Now, back to reading about early season walleyes.........

Are you from Minnesota? walleyes and the name youbet - very close to youbetcha....

 

[Ed_The_Gypsy]

I am down 5% this week and am not concerned. I managed to stand pat during The Crash of '87 and the dot-com collapse and a down week doesn't scare me. It is still only a paper loss.

.....................................................................................................

Off-topic: I have the windows open tonight in my apartment in city-centre Calgary and someone is playing pretty good bagpipes with drums in the distance. Far out! The pipes always remind me of my late tanker buddy, who was mad about the pipes. A hero many times over (and a wife to match), who lived and died in a broken body, but with an absolutely indomitable spirit. I think of of the piper at the gates of Tobruk when I think of him.

Lesson: Win or lose, be brave.

Maybe it wasn't off-topic after all.

Ed

 

[bpp]

After the rocket ride up the last couple of years, a little retrenching would seem to be in order. Hoping for more hamburgers to become affordable.

Bpp

 

[preben]

What does annoy me a bit is that diversification didn't do squat (or only very little) to help. EVERYTHING is red these days..

Cheers!

 

[cute fuzzy bunny]

Maybe it only USED to be diversification?

Now everyone knows the same tricks?

 

[preben]

Yeah, we should have kept our big mouths SHUT instead of helping all those newbies!
Cheers!

 

[bpp]

Not everything is red, ben. Maybe you're not diversified enough. (Of course, if you're not, then goodness help the rest of us!)

It depends on what level you are looking at, too. If you peeked inside some of your funds, you'd find plenty of individual issues that are up.

Bpp