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01-03-2011, 05:31 PM
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#1
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Here Comes The Herd
Is the retail investor returning to stocks? - Yahoo! Finance=
Looks like we got a stampede here, pardner. Git ready to head these doggies into the corral.
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"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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01-03-2011, 05:37 PM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
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One year ago, the first day of 2010 was a fantastic day in the market. I think it was up even more than the first day of 2011. Not only can journalists just pull out old copy, we can also pull out our old posts and recycle them as well.
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01-03-2011, 05:38 PM
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#3
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Thinks s/he gets paid by the post
Join Date: Oct 2004
Location: LaLa Land
Posts: 4,698
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Hey, everything runs in cycles.
Maybe we should start getting ready to get out.
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01-03-2011, 05:41 PM
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#4
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Quote:
Originally Posted by LOL!
One year ago, the first day of 2010 was a fantastic day in the market. I think it was up even more than the first day of 2011. Not only can journalists just pull out old copy, we can also pull out our old posts and recycle them as well.
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Very likely. Having said that, where are the retailers going to go? Cash yields bupkis. The many financial Pravdas are all spouting the party line on bonds (interest rates rising is bad for bonds). What is left? Equities and commodities. Commodities simply are not a big enough market to take the potential inflows. Add in some confidence-inspiring economic data and a couple of years of trailing strong performance and you have the perfect conditions for retailers to decide the train is leaving the station and they better not miss it.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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01-03-2011, 05:58 PM
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#5
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2003
Location: Hooverville
Posts: 22,983
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Quote:
Originally Posted by brewer12345
Very likely. Having said that, where are the retailers going to go? Cash yields bupkis. The many financial Pravdas are all spouting the party line on bonds (interest rates rising is bad for bonds). What is left? Equities and commodities. Commodities simply are not a big enough market to take the potential inflows. Add in some confidence-inspiring economic data and a couple of years of trailing strong performance and you have the perfect conditions for retailers to decide the train is leaving the station and they better not miss it.
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Brew, it turns out that you are a speculator. Who'd a thunk it?
Ha
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"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
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01-03-2011, 06:03 PM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 14,183
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Back up the truck...
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Have Funds, Will Retire
...not doing anything of true substance...
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01-03-2011, 06:07 PM
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#7
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Quote:
Originally Posted by haha
Brew, it turns out that you are a speculator. Who'd a thunk it?
Ha
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Nah, not really. I am a long term value investor and willing to be quite patient. My investment theses are rarely based on the presumed actions of others, except for expectations that gross misvaluations will be corrected by the market over time. But if the herd does come charging in, it would add quite a lot of whipped cream and a whole jar of cherries on top of my investment sundae.
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"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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01-03-2011, 08:13 PM
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#8
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Moderator Emeritus
Join Date: Dec 2002
Location: Oahu
Posts: 26,860
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A small-cap value ETF that we've owned for several years (IJS) is approaching levels not seen since 2007.
Surely the underlying stock's profits are also approaching those levels, right?
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Co-author (with my daughter) of “Raising Your Money-Savvy Family For Next Generation Financial Independence.”
Author of the book written on E-R.org: "The Military Guide to Financial Independence and Retirement."
I don't spend much time here— please send a PM.
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01-03-2011, 08:30 PM
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#9
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2003
Posts: 5,105
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__________________
Sometimes death is not as tragic as not knowing how to live. This man knew how to live--and how to make others glad they were living. - Jack Benny at Nat King Cole's funeral
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01-03-2011, 08:57 PM
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#10
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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REITs with fat expense ratios. That will be the flavor of the month. Just sold a bunch of equity index to keep me at 50/50, and I hope I'll be selling more as people pile back in this spring.
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01-03-2011, 11:51 PM
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#11
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Dryer sheet aficionado
Join Date: Dec 2010
Posts: 45
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ah yes, the "healing process" is exceeding expectations and the "new normal" might not be so bad
there will be several surprises in 2011 --- all of which will be used to shake the tree
so I am keeping some powder dry at this point --- if I miss some of this January effect --- oh well, such is life
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01-04-2011, 09:08 AM
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#12
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Full time employment: Posting here.
Join Date: Aug 2005
Location: Far NW 'burbs of Chicago
Posts: 898
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Quote:
Originally Posted by brewer12345
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The many financial Pravdas are all spouting the party line on bonds (interest rates rising is bad for bonds).
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The way you phrased that may suggest that you don't agree?
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01-04-2011, 09:35 AM
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#13
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Thinks s/he gets paid by the post
Join Date: Aug 2007
Posts: 1,224
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Jeesh. I'm having a hard enough time now holding my nose and buying TIPS/Treasuries to keep my bond allocation where it needs to be. Brewer your adding flame to the fire already! Hopefully some classes will be left behind (like EM) and I can pick those up along the way. Oh well when the party is over equities will again be cheap(er) and I'll pony up to the table to fork some into my portfolio again. Its hard to complain though given the last 2 years.
DD
Maybe we can get WR to post a Wheeeeee! and get a market correction .
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At 54% of FIRE target
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01-04-2011, 09:37 AM
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#14
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2003
Location: Hooverville
Posts: 22,983
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Fellows, we are the herd.
Ha
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"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
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01-04-2011, 09:47 AM
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#15
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,152
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Quote:
Originally Posted by brewer12345
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I guess I would expect this about now, with a decent 2010 after a strong 2009 and then nice strong opening day to the new year.
I had read that just say 3 months ago was the first time in quite a while that retail investors had net redemptions from bond funds.
But I don't think it'll be like in the past - in the 90s and even mid-2000s, because people were really burned badly with the last go around and I think the mentality is more likely the 70s (maybe, I didn't follow markets back then) where people have a very strong distrust of the markets.
Audrey
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Retired since summer 1999.
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01-04-2011, 09:50 AM
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#16
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
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My concern with the market is that it feels like increasing profits are being driven more by cost cutting than by top line revenue growth. That isn't sustainable, as you can only cut costs and reduce payrolls so much -- but as mentioned before, many people feel like there's no other place to put long-term capital as cash yields basically zero and bonds could get smacked by interest rate hikes.
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"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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01-04-2011, 09:52 AM
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#17
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,152
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Quote:
Originally Posted by ziggy29
My concern with the market is that it feels like increasing profits are being driven more by cost cutting than by top line revenue growth. That isn't sustainable, as you can only cut costs and reduce payrolls so much -- but as mentioned before, many people feel like there's no other place to put long-term capital as cash yields basically zero and bonds could get smacked by interest rate hikes.
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But that's OK. It's when companies realize they can't cut costs anymore to grow revenue is when they become willing to invest for growth and start buying stuff and hiring people. Unless they are happy being a cash cow - and some are - and that's OK too if they pay dividends.
Audrey
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Retired since summer 1999.
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01-04-2011, 10:00 AM
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#18
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
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__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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01-04-2011, 10:41 AM
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#19
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Quote:
Originally Posted by Gearhead Jim
The way you phrased that may suggest that you don't agree?
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I have allowed my bond allocation to dwindle down pretty darn far (close to my min), so take what you like from that. I am simply amazed at how the various financial "news" outlets all find a way to sing from the same hymnal time and time again.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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01-05-2011, 04:18 AM
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#20
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2007
Posts: 5,072
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Fear may have finally given way to greed...
I think the smart move is to stick with the planned approach... for me that is a strategic allocation and rebalancing.
But if I see certain opportunities emerge over the next several year I am not opposed to taking some money and making a Tactical Allocation.
I am going to be very interested to see what happens with interest rates.
Right now our intermediate bond allocation is low... For the most part intermediate bonds are in the balanced funds we hold.... most of our fixed is in stable value, short-term bond funds and cash.
I have two things that I am watching closely to interest rates.
- I am considering a SPIA to round out our base income. Which... if we do it would be using a ladder.
- I want to take a portion of our bond allocation and build a ladder with it.
I am hoping we do not experience high inflation. But if we do... I want to have a fixed strategy that will hopefully benefit us... or at a minimum limit the negative impact.
It is interesting. I spent the last 25 years studying the stock market closely. Now I am trying to get up to speed on the bond market because we have a large fixed allocation and income assets that are at its mercy!
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