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Old 09-30-2008, 03:44 AM   #41
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Always capitulate before you go to sleep

(what's the point of a revolution without general, general capitulation, capitulation, capitulation--Marat/Sade)
First thing in the morning works too.

We're seeing a total credit lockdown. Banks won't lend to anyone. There isn't any faith that banks will be able to pay them back. I don't know where it will end but I'm convinced it is a self-fulfilling disaster. An effective break in creating value in performing mortgages will go a long way to fixing what's wrong.

Speaking of credit -- My CD from Silver State Bank (defaulted) has finally paid its dividend and the CD was also cashed out by the acquiring bank. The money is in my brokerage account.
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Old 09-30-2008, 05:38 AM   #42
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First thing in the morning works too.
No comment! moving right along....

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We're seeing a total credit lockdown. Banks won't lend to anyone. There isn't any faith that banks will be able to pay them back. I don't know where it will end but I'm convinced it is a self-fulfilling disaster. An effective break in creating value in performing mortgages will go a long way to fixing what's wrong.
What a mess. I am so lucky that I am older with no need to borrow. Younger people are really going to have to scramble, or borrow from the "Bank of Mom and Dad". Luckily, my daughter hasn't ever done that (yet).

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Speaking of credit -- My CD from Silver State Bank (defaulted) has finally paid its dividend and the CD was also cashed out by the acquiring bank. The money is in my brokerage account.
I am so happy for you! Even though nobody has ever lost money from an FDIC insured account, still I would have thought it could take longer had they stepped in. I guess they don't have to if the bank was acquired. At any rate, you have the cash in hand, and what a relief that must be.
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Old 09-30-2008, 07:11 AM   #43
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Was it Bernstein that said "diversification fails us when we need it most"?
Anyway, I have been trying to wean myself from market timing. So since I am ERed and completely invested, there is nothing to do but wait for the turnaround.

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Old 09-30-2008, 07:14 AM   #44
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Oldbabe, I heard that every stock in the Dow was down today. I have heard it said that this downturn is unusual in that normally uncorrelated assets are sinking simultaneously.
That's a big reason why this one feels so sickening. In the tech wreck of 2000-2002, several equity classes went sharply higher (small caps, REITs, emerging markets, precious metals to name a few). As a result someone who had a diversified AA (and not overweight tech) didn't get slaughtered then because gains in these areas mostly offset losses in large cap U.S. stocks.

Contrast that to now, where nothing that's an equity asset class is avoiding the carnage.
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Old 09-30-2008, 08:03 AM   #45
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I hated to wake her...
We call that playing coroner...

But yeah, capitulation is getting closer. This fiasco yesterday really got to some of our folks. Boss came back from lunch with a pint of Haagen Daz.

It is times like these that will serve to remind me that when retirement comes, I will have cash reserves for living expenses--it may mean that we live on less, but at least one of us will be sleeping.
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Old 09-30-2008, 08:13 AM   #46
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It is times like these that will serve to remind me that when retirement comes, I will have cash reserves for living expenses--it may mean that we live on less, but at least one of us will be sleeping.
It certainly shows why the concept of having "buckets" could be useful. Any retiree who put 5-10 years of income needs into "safe" stuff is probably weathering this a lot more easily than someone who didn't.
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Old 09-30-2008, 08:17 AM   #47
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It certainly shows why the concept of having "buckets" could be useful. Any retiree who put 5-10 years of income needs into "safe" stuff is probably weathering this a lot more easily than someone who didn't.
Well, the old saying: "Cash is king" is probably appropo at this point.......
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Old 09-30-2008, 08:26 AM   #48
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It certainly shows why the concept of having "buckets" could be useful. Any retiree who put 5-10 years of income needs into "safe" stuff is probably weathering this a lot more easily than someone who didn't.
Unfortunately the definition of "safe" has become A LOT more narrow.

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Old 09-30-2008, 09:24 AM   #49
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When wondering whether we've hit the low, the phrase I listen for is "there's no bottom in sight," which also works for "have we copulated yet?"

And speaking of this, the police chief of a nearby town was recently indicted on charges of raping his wife while she was sleeping. She (a sergeant on the same force) said it happened hundreds of times. Ambien was involved. He was acquitted on those charges but convicted of other things.
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Old 09-30-2008, 09:27 AM   #50
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Ambien was involved.
So it was a threesome?
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Old 09-30-2008, 10:04 AM   #51
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That's a big reason why this one feels so sickening. In the tech wreck of 2000-2002, several equity classes went sharply higher (small caps, REITs, emerging markets, precious metals to name a few). As a result someone who had a diversified AA (and not overweight tech) didn't get slaughtered then because gains in these areas mostly offset losses in large cap U.S. stocks.

Contrast that to now, where nothing that's an equity asset class is avoiding the carnage.
Yeah but just think, they should all go up together too, and won't that be fun!
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Old 09-30-2008, 02:04 PM   #52
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if this wasn't the bottom, i think it will be in a few months on a lower VIX

even after yesterday the charts were still bullish and looked a lot like end of 2002. back then it was pretty bad on July where the VIX hit the same level as now and then a lower low in October on a lower VIX and some averages like the MACD were higher than July.

means that the second drop was a lot faster and people sold out of pure fear where the first drop is more gradual and people still have hope
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