Is there always a wall of worry to climb?

[UnrealizedPotential]

I ask because it does seem during bull markets it is NEVER crystal clear that we are in a bull market. There is always things to worry about. Inflation, deflation , interest rate rise, recession,etc. I understand why investors might be scared to invest. I am not referring to forum members. However, there will never be a time when it is obvious that things are going to be good in the markets. If it is, then I will be very scared. We will probraly be overbought at that point. IMO, we are not there yet, nor do I really care one way or the other. I just find it interesting how things work. Thoughts?

 

[Big_Hitter]

keep a lot of cash

 

[HFWR]

Not to say that I don't "adapt" to changing conditions, like reducing riskier asset classes like EM, or shortening the duration of my bond funds, but, generally speaking, I try not to "play" the market one way or the other.

I try to "own" assets, long-term, as investments. The guy/gal who owns the local hardware/grocery/liquor store doesn't buy and sell their business based on market movements...

 

[petershk]

The problem in hindsight bias. I think Micky Mantle once commented that he didn't realize how easy baseball was until he was in the commentators booth.

My own experience is that I think I am far better at investing than I am and despite telling myself "buy low sell high" my human weaknesses practically guarantee the opposite behavior.

So.... I think it's really two choices:
1) if you have the temperament, you can spend a large amount of time understanding a few businesses really well and potentially beat "the market" consistently over a long period of time.
2) you can get market returns

I think anything in between is more or less luck waiting to meet disaster or the other way around .

Of course everyone has their opinion and hard to prove. The few investors on "richest" lists tend to be in category (1), but you need to look at the graveyard which probably has 100k bodies per person on the rich list. I'm fairly confident I know where I'd end up

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[Spanky]

The market is always risky. Know your risk tolerance, put aside cash for x years of expense or emergency funding, diversify, tune out the noise and stay the course.

 

[UnrealizedPotential]

The market is always risky. Know your risk tolerance, put aside cash for x years of expense or emergency funding, diversify, tune out the noise and stay the course.

Good answer.

 

[W2R]

For some people, yes. A lot depends on your individual temperament and confidence, and of course asset allocation.

We have been undergoing a strong bull market since 2009, and honestly I haven't seen any reason whatsoever to worry since that time. On the other hand, I don't listen to Cramer or other financial shows/news because none of them have the slightest clue.

It helps to look at market declines as opportunities to enrich oneself. My nestegg really grew a lot because I closed my eyes, grimaced, and then rebalanced during late 2008 and early 2009. I didn't buy as much as many others here, or as much as I could have, but I did buy and what a difference that made.

As the song goes, don't worry, be happy. We'll have plenty of time to worry when we get to the next market crash. I'd suggest taking the long term approach recommended by HFWR above, and never listening to or reading financial news or other financial shows or columns. Just stay the course.

Look at this chart, which I added via our good ol' edit function - - despite ups and downs, in the long term the trend is upwards.

 

[MichaelB]

It helps to look at market declines as opportunities to enrich oneself. My nestegg really grew a lot because I closed my eyes, grimaced, and then bought during late 2008 and early 2009. I didn't buy as much as many others here, or as much as I could have, but I did buy and what a difference that made.

As the song goes, don't worry, be happy. We'll have plenty of time to worry when we get to the next market crash.

This is really important. A sharp market decline is a problem, but also an opportunity. We can't prevent it or know when it will happen, so the best we can do is grit our teeth and take advantage of it.

 

[ArkTinkerer]

There is always something to worry about if you choose to do so. If you KNEW you were in a bull market you could always worry about it crashing tomorrow. Maybe the Japanese will attack Pearly Harbor again from a base they built on the dark side of the moon during WWII... Your mind can always find something to worry about.

 

[Sunset]

There is always something to worry about if you choose to do so. If you KNEW you were in a bull market you could always worry about it crashing tomorrow. Maybe the Japanese will attack Pearly Harbor again from a base they built on the dark side of the moon during WWII... Your mind can always find something to worry about.

Odd statement as they are our Allies and trade partners.

More likely would be terrorist flying planes into Sears/Hancock towers. A proven technique. Both would take out the CBOE.

Or return of cold war, since Putin has said he alerted Russian nuke forces since people didn't like his most recent land acquisition .

 

[ArkTinkerer]

Odd statement as they are our Allies and trade partners.
.

I was thinking about a bad movie that was available on netflix. I recall now it was about Germans on the dark side of the moon not Japanese. They say memory is the second to go... I forget the first....

 

[Big_Hitter]

Actually that is a good movie on Netflix.

 

[imoldernu]

My time is spent trying to understand the macro economy, for the US and Internationally. Enough for me.
Understanding the stock market? Beyond comprehension.

Wednesday I filled up one car @ $2.13/gal.
Thursday... same station, the other car... $2.39/gal.
go figger!

 

[Big_Hitter]

^ volatility is volatile

 

[HFWR]

Wall of worry?

Putin. ISIS, Boko Harum, Hezbollah, etc. Iran with near nuke capabilites, NK and Pakistan already in the club. Global warming. Drought. Bird flu. Ebola. Justin Bieber...


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[W2R]

Wall of worry?

Putin. ISIS, Boko Harum, Hezbollah, etc. Iran with near nuke capabilites, NK and Pakistan already in the club. Global warming. Drought. Bird flu. Ebola. Justin Bieber...

Justin Bieber? You worry about Justin Bieber? That little twerp. I think he and Miley Cyrus are a matched set and should really start going out.

 

[gcgang]

There's always stuff to worry about. So, don't worry about it. Be happy.

But don't take any more risk than you need to meet your own personal goals. As I'm now retired, reducing stock exposure as the market has run up has allowed me to worry less, even though I know I'm not "maximizing" returns.




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[HFWR]

Justin Bieber? You worry about Justin Bieber? That little twerp. I think he and Miley Cyrus are a matched set and should really start going out.

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[Mango1956]

View attachment 21325


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LOL!

 

[ArkTinkerer]

Justin Bieber? You worry about Justin Bieber? That little twerp. I think he and Miley Cyrus are a matched set and should really start going out.

You want them to reproduce??

 

[Rick_Head]

 

[Dreaming of Freedom]

Justin Bieber and Lindsey Lohan seem like a better match. Miley Cyrus doesn't really seem all that messed up to me, just another celebrity in Hollywood making money from shocking people, but on purpose.

 

[Major Tom]

Maybe the Japanese will attack Pearly Harbor again from a base they built on the dark side of the moon during WWII...

Pearly Harbor? Is that where people like this live?

 

[Major Tom]

UnrealizedPotential - you sound to me like the kind of investor who should be gradually dollar cost averaging into the market via index funds, over the long term. That way, you are not focused on when is a "good" or "bad" time to get into the market, as you are "getting into it" constantly, regardless of the myriad of influences in the economy and media landscape that could scare you.

If you truly take the long term view that the future looks pretty good, then the bumps along the way won't trip you up.

 

[NW-Bound]

Climbing a wall of worry?

Sounds to me it is much better than sliding down a chute of despair, à la Great Recession of 2008-2009.

Let's hope the latter will not repeat anytime soon. A nice coast on cruise control would be welcome, say 3-4% real return for a while?