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View Poll Results: Are we headed for doom in 2023?
Yes, things are going to get bad! Sell, Sell, Sell... 11 6.96%
No, this is just like any other time. Buy and hold... 43 27.22%
I don't have a crystal ball so how would I know... 104 65.82%
Voters: 158. You may not vote on this poll

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Old 07-04-2021, 09:02 PM   #41
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Stocks are the fast lane and that means occasional crashes and traffic snarls. To make money getting out of the fast lane, you have to be right not only on the timing to get out, but also the timing to get back in. I doubt any of us here have any special ability to foresee when either a crash or recovery is going to happen.

A few years ago, I was talking to a guy that was bragging he got out and went to cash before the crash. After probing a bit, it came out that he meant he got out in 1999 and nearly 20 years later had never gotten up the nerve to get back in. So he had scared himself into a lot of lost opportunity.

Nobody knows nuthin' about the future is a very wise saying.
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Do you think 2023 is 1929, 1966, 2000, etc?
Old 07-04-2021, 11:15 PM   #42
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Do you think 2023 is 1929, 1966, 2000, etc?

Quote:
Originally Posted by NW-Bound View Post
Great. Whenever I click "sell", I always know there's somebody else who clicks "buy".

Oh yeah. And the best part is that it keeps going up!

What can go wrong?
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Old 07-05-2021, 04:37 AM   #43
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I made all my major final adjustments in AA about 5 years ago. The stock market, bond market, and banks will all have to fail at that time to get me in a little trouble. By then the entire country will have to be going down hill. But as long as our SS and small pensions are still coming in then I will still have a little money coming in to buy groceries so I am not concerned.



Cheers!
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Old 07-05-2021, 04:48 AM   #44
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I have no idea. It will be different, the world economy, the US economy and technology are all different from those prior periods. I'll be unemployed in two weeks so I sure hope it's different! I ran my cash flow model assuming a 30% drop NOW and only 5.5% growth thereafter with 3% inflation (2.5% real after the drop) and would get by... obviously a bad model with linear growth. Even at 50% with 2.5% real returns I'd get by in theory. I sure hope not, as it would be a bit nerve racking. I'm risk averse but then almost everyone thinks I'm crazy for quitting so maybe I am not!


Personally, the market "feels" high and don't expect another booming decade. Ideally, for me, would be slightly slower equity price growth as the world economy catches up and drops multiples down to more comfortable levels. I think that is the most likely scenario but then what do I know?
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Old 07-05-2021, 06:29 AM   #45
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Well, if she was smart enough to buy it all back around Thanksgiving 2008, or March 9, 2009, I'd say she was a market timing genius. But, somehow, I have a feeling she didn't do that?
Oops! I was off by a year...she "sold everything she had in the market" on the last Friday of February 2009! The following week the market took off and never looked back. And no, she never went back.
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Old 07-05-2021, 07:22 AM   #46
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MLB Hall of Famer Billy Williams once said, "A slump starts in your head and winds up in your stomach"

Entering my 2nd year of retirement, I am mentally concerned about a long, sustained correction. I feel our AA is where it should be at between 55-60% equities, and we have about 4-5 years of living expenses in cash/CDs. But it would be a mental challenge.
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Old 07-09-2021, 03:55 PM   #47
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Thanks to COVID-19, we learned that we can live on about half what we have budgeted in retirement.

We sure did eat out and travel a lot 😀
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Old 07-09-2021, 04:26 PM   #48
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Originally Posted by rodi View Post
Since I'm not a market timer and my investment plan calls for rebalancing to my preferred asset allocation on both down markets and up markets... It's all good. Not going to sell on a prediction that the market may crash. Not going to buy on a prediction the market may boom... Just rebalance as needed.

And I'm finally reaching the point where I'm less worried about sequence of returns risk (SORR). I would probably be more nervous if I was just approaching retirement or very recently retired.
My husband retired last November and I am working part-time advising my department. FireCalc gives us 100% but I am nervous about Sequence of Returns risk so am going to consult for a while until I feel more comfortable. I feel better knowing I have an income flywheel if needed and I can work as much or as little as I need/want to.
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Old 07-09-2021, 04:51 PM   #49
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Originally Posted by kflesko View Post
My husband retired last November and I am working part-time advising my department. FireCalc gives us 100% but I am nervous about Sequence of Returns risk so am going to consult for a while until I feel more comfortable. I feel better knowing I have an income flywheel if needed and I can work as much or as little as I need/want to.
Understood.
Just note that the risk of the worst historical SORR is already built into the Firecalc result which provided you with the 100%.
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Old 07-09-2021, 05:04 PM   #50
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I think 2023 is gonna be just like 2023. Same as it ever was.
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Old 07-09-2021, 05:11 PM   #51
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I think 2023 is gonna be just like 2023. Same as it ever was.
And you may ask yourself, "Where is that large automobile?"
And you may tell yourself, "This is not my beautiful house"
And you may tell yourself, "This is not my beautiful wife"

Eh, it just popped into my head
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Old 07-09-2021, 05:17 PM   #52
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My god, what have I done?

Water flowing under...
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Old 07-09-2021, 05:21 PM   #53
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Assuming our future is no worse than anything in Firecalc's historical range, and you are at 100% success, has anyone considered that not everyone around you will have 100% success? Maybe you'll have a sibling or offspring who is in a lot worse financial straits. Or a dear friend. Are you going to help them out, or just help them find a quiet bridge to live under? I feel like a lot of parents are willing to take a hard line with kids, but what if grand kids are involved?

For some there may be no one close enough to feel obliged to help, and some may just choose not to, but others will. Maybe having someone live with you, while being inconvenient, does not hit the bottom line very hard.

Just a point for consideration. Those Firecalc success rates take you at your word that your expenses are accurate.
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Old 07-09-2021, 06:00 PM   #54
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I like the Dalio and Artemis Capital understanding of cycles to inform decisions. We just rode 40 years of interest rates down to zero, which left bond holders rich. The dropping cost of capital led to PE expansion, which left stock holders rich. We socialized the cost of mortgages in 2008, so that half the mortgage holders in the country now live in government housing via Fannie/Freddie subsidized loans. Uncle Sam's backstop made home holders rich.

Add in 100's of trillions for FICA and healthcare Fed obligations... It is a highly combustible situation.

The typical central bank playbook in these conditions is to forcefully inflate the money supply and ruin anyone who owns bonds or fixed rate notes. The last time this happened was after WW2. So Dalio et al expects a rerun of the late 40's to early 60's. Lots of running in place, full employment, prices like a rubber band.

It took the Fed about 15 years to ruin the value of anyone holding war bonds. Markets seem to move faster nowadays, boom to bust to boom in record time. I am guessing at 3 dips, with plateaus to rest over 5-8 years. Not a hyper inflation, but a steady grind.

As in Weimar Germany, stocks of economically essential companies will struggle along and hold value. Debts become worthless, so its a great time to borrow if you can find someone dumb enough to give you money. The longer it grinds, the weaker companies will falter and fail, till it is just Maslow's needs getting paid.

My grandfathers house $2-4k, my fathers house 20-40k, my house $200-400k. The next generation... $2-4M. Same house, just less valuable money.

It's hard to keep score when the denominator moves around. That's the point.
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Old 07-10-2021, 10:06 AM   #55
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Iím putting all my investments into tulip bulbs. I got a tip from my cousinís dental hygienist.
On a more serious note, interest in stock investment by people who aren't normally picking stocks has been about as good a sell signal as exists.
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Old 07-10-2021, 10:54 AM   #56
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Lots of pessimism in this thread. I'll give 2023 a 4% chance of being as bad as any if the listed years.

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Income Buckets
Old 07-10-2021, 05:16 PM   #57
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Income Buckets

This is why we don't have all our eggs in the stock market. Probably 20 years ago, we read a book called Multiple Streams of Income. It was an eye-opener. And we realized after 2008 that having everything in the market was not our best option. We've been retired since 2015 and we have 3 1/2 buckets:

IRA--which we won't touch until we have to when the DH turns 72. It's done nothing but grow since he retired and stopped contributing to it.

SS & small (think microscopic) pension--The DH has received a little pension from the 11 years he spent with an airline which is about enough to cover our Medicare and almost all our supplement payments each month. This year we are finally took our FRA SS benefit which pretty much covers our expenses, less about $700.

Rental properties--These little jewels (10 in all, 5 duplexes) have given us terrific ROI month after month. Even during Covid and eviction moratorium dictums, we did very well. They are also why the DH was able to retire at 60. And now that SS & the pension are covering so much of our budgeted spending, this income is gravy.

Stock account--This is our 1/2 bucket because we use it to fund our travel (Taking six of our family to Alaska in September. Hopefully heading out on our 2nd World Cruise next January). We're also buying our daughter a house from this bucket. We figure why wait to die to bless her life? We've got it. Why not share it with our loved ones?

So the market can go up or it can go down. If one bucket leaks, we'll start using another one.
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Old 07-10-2021, 09:53 PM   #58
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No contradiction here. I have 75x yearly living expenses not including pension or SS. As I said, I am merely curious as to what other people think. I happen to think there will be a big crash in 2023 but I'm most probably wrong. If there is, it will be a great buying opportunity.

Give yourself a couple years cash if you are feeling hinky about sequence of returns ?
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Old 08-31-2021, 02:32 AM   #59
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Quote:
Originally Posted by rmcelwee View Post
Do you think 2023 is 1929, 1966, 2000, etc?
Total return (price performance plus dividends) of the S&P 500:

1929: -8%
1966: -10%
2000: -9%

My answer to your question is that the above kinds of results are well within the range of likely outcomes for 2023.

And a run-of-the-mill, garden-variety bear market (such as between -20% to -50%) would not be particularly surprising either, as we already know that these happen with some regularity. What would be out of character for the market is if we don't see them happen anymore. That would be the proverbial "man bites dog" story.

In other words, I'm predicting business as usual. Just another day at the office. Yawn.

Which poll answer should I pick?
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Old 08-31-2021, 06:08 AM   #60
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Originally Posted by Maidensong View Post
This is why we don't have all our eggs in the stock market. Probably 20 years ago, we read a book called Multiple Streams of Income. It was an eye-opener. And we realized after 2008 that having everything in the market was not our best option. We've been retired since 2015 and we have 3 1/2 buckets:

IRA--which we won't touch until we have to when the DH turns 72. It's done nothing but grow since he retired and stopped contributing to it.

SS & small (think microscopic) pension--The DH has received a little pension from the 11 years he spent with an airline which is about enough to cover our Medicare and almost all our supplement payments each month. This year we are finally took our FRA SS benefit which pretty much covers our expenses, less about $700.

Rental properties--These little jewels (10 in all, 5 duplexes) have given us terrific ROI month after month. Even during Covid and eviction moratorium dictums, we did very well. They are also why the DH was able to retire at 60. And now that SS & the pension are covering so much of our budgeted spending, this income is gravy.

Stock account--This is our 1/2 bucket because we use it to fund our travel (Taking six of our family to Alaska in September. Hopefully heading out on our 2nd World Cruise next January). We're also buying our daughter a house from this bucket. We figure why wait to die to bless her life? We've got it. Why not share it with our loved ones?

So the market can go up or it can go down. If one bucket leaks, we'll start using another one.
You mentioned IRA and Stock account separately. How is the IRA invested? Stocks, bonds, other? Aren't they both in the markets? But the point of your post was the rental properties, which I totally get.
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