Down Day in the Market !

[frayne]

HOLY COW, said tongue in cheek. It is kind of funny and we all expected it but I have to laugh at the talking heads on the boob tube trying to explain away the reason for reversion to the mean.

[ownyourfuture]

https://www.youtube.com/watch?v=kK62tfoCmuQ

[Major Tom]

It's a bit weird really, but this is kinda fun. I'm sure others here will understand.

[exnavynuke]

Buying more today...

[Christine]

Definately interesting to watch it go from red hot to red. But 2% cannot take us back very far in time. It's more like a little rain on a hot summers day. Made me smile.

[ESRwannabe]

I'm getting close to being able to retire early. I would love to get the crash over with while I'm still employed and stash some more money at lower prices.

Plan has been to ESR at 45. I turn 42 this year. Taxable brokerage account dividend and interest income is $28k (AA 50/50 fixed income and stocks), living expenses $30k, w-2 income $70k, years in pension 17. Should be ready by 45 to ESR for 15 years and then ER. At 60 can collect pension (20 years vested) plus 401k/Roth IRA.

Bring on the crash.

[jazz4cash]

I expect it will continue on Monday.

[karen1972]

Thank goodness, there has been a lot of craziness with the new generation of investors who think the market only goes up and up an up.. We need some scary down days to help them put things in perspective... and hopefully, stop taking such crazy risks. Its one thing to be aggressive but I've seen way too many posts where people have their life savings in stuff that is pure gambling speculative... get enough of those people and thats how bubbles happen.

[jollystomper]

Quote:

Originally Posted by frayne HOLY COW, said tongue in cheek. It is kind of funny and we all expected it but I have to laugh at the talking heads on the boob tube trying to explain away the reason for reversion to the mean.

I'm still waiting for the "Markets May Have Had a Bad Week But They Are Still Up Over 3% YTD So Why Is Everyone Panicking? Settle Down People!" headline.

[LOL!]

Quote:

Originally Posted by jazz4cash I expect it will continue on Monday.

Maybe. Maybe not.

There were people not paying attention today, so this weekend they will have a chance to see what happened to their portfolios.

One group will say, "OMG! I lost a ton and need to get out."
Another group will say, "OMG! Buying opportunity!"

We won't know which is the larger group until next week.

[copyright1997reloaded]

Quote:

Originally Posted by ESRwannabe I'm getting close to being able to retire early. I would love to get the crash over with while I'm still employed and stash some more money at lower prices. Plan has been to ESR at 45. I turn 42 this year. Taxable brokerage account dividend and interest income is $28k (AA 50/50 fixed income and stocks), living expenses $30k, w-2 income $70k, years in pension 17. Should be ready by 45 to ESR for 15 years and then ER. At 60 can collect pension (20 years vested) plus 401k/Roth IRA. Bring on the crash.

So, you have a plan that tells you when the crash is over?

Here's the thing about down markets: It is hard to tell when the big down is over, just like it is hard (except when looking back in time) to tell where the peak is.

On the upside, there were plenty of people thinking the market had peaked in 94, 95, 96...and the market kept on going up and up and up. Staying out of the money cost them tons of money, and shorting was disastrous.

Similar for the downside. Let's say you were 50/50 in 1929 at the market peak, with the SP @ 31.86. You smartly ride out the crash and in fact stay out until the SP dropped all the way to 15.93 (a 50 PERCENT drop). You then invest your 50% remaining cash (er, assuming your bank hadn't been wiped out, but I digress). But you are early (in retrospect), and the SP 500 drops all the way down to 4.4 (a 86.1% drop from the peak). How much are you down at the bottom? Well, 86.1% on 50% and 72.4% on the other 50% you invested when you "thought" the market had bottomed.

[NW-Bound]

Quote:

Originally Posted by Major Tom It's a bit weird really, but this is kinda fun. I'm sure others here will understand.

Yes. In less than 1 month, my fleeting gain was more than 2 years of living expenses.

Then poof, more than 1/2 of that was gone this week. If I knew, would sell all last Friday.

A 6-figure "loss", just like that. Easy come, easy go.

My consolation is that it looks like the Feb covered call options I still have outstanding will bite the dust, but that only gives me $6K in cash. A puny amount compared to what is "lost", but I guess that's better than nothing.

[NanoSour]

I looked into my crystal ball to see where this market is headed and it said, and I quote "Don't even think about, Idiot!"

[Senator]

I bought 25 shares of HDV today near the bottom, 90.25. I stopped buying for a few months due to other expenses, other than reinvesting dividends.

I am still trying to increase my dividend stream.

[Live And Learn]

I'll be watching Monday morning. The last time this happened one of my ETFs had a 20% flash crash that I was able to buy into. I would LOVE to do that again

[ESRwannabe]

Quote:

Originally Posted by copyright1997reloaded So, you have a plan that tells you when the crash is over? Here's the thing about down markets: It is hard to tell when the big down is over, just like it is hard (except when looking back in time) to tell where the peak is.

No, I don't know when a crash will happen or when it will end, nor how bad it will be, nor how many times in a row it will happen, blah bah blah.

I am always 100% invested. The 50/50 AA is not because I think there will be a crash. That is my standard AA. I do not use fixed income for re-balancing, I use it to generate cash, same with equities. I am not a MPT investor, my withdrawal strategy is based on generating income. I invest in stocks/bonds like a real estate investor invests in property. The goal is to build free cash flow.

I invest to build cash flow. So while I may not have cash sitting around, I do have cash flow. If we have a crash now I can put 100% of it into reinvestment. Hence my desire for it to crash now, the sooner the better.

[easysurfer]

Dow ended down 666 (rounded) pts on Friday .

Will be interesting to see what Monday brings. A bounce or continued drop or barely a move. Fear vs greed in action. Gotta love .

[Jeffman52]

I have time to ride this out. I think this will be a bit bumpy for a few weeks leading into another rise. That's what my gut tells me. Hope its not wrong LOL

[foxfirev5]

Quote:

Originally Posted by Senator I bought 25 shares of HDV today near the bottom, 90.25. I stopped buying for a few months due to other expenses, other than reinvesting dividends. I am still trying to increase my dividend stream.

That's the game . Income streams. Maybe the income and divey investors will have their day. Either way I will survive.

[RAE]

The talking heads say that today's drop was due to fears of higher interest rates, and perhaps they are right. I have a feeling, though, that the Trump/Nunes/FBI Russia thing is going to send some fairly major tremors through the markets soon as well. Maybe next week, maybe after that, but I think it will happen.

Not trying to start a political discussion here at all.......just an observation/prediction.