So, the Saudi's has orchestrated a drop in Oil to a 10 year low, China's false economy is finally coming home to roost and Japan and the Eurozone have stagnant growth. The FED is finally raising rates and I would be surprised if they don't raise another 50 to 75 bps in 2016, despite the bad global economy. They might spread it out more but I don't think they will stop or reverse. These conditions will put tremendous pressure on the US economy and might drive into a recession. As such, the US stock market has made a correction of over 10% from it's 52 week high and with it being overvalued even at Friday's close coupled with the aforementioned headwinds history points to a further adjustment that could see this market drop another 10 to 20%. Lastly, RBS says sell everything and other Doomer's are jumping on the bandwagon.
So, looking back at 2007 thru 2009, the market corrected over 50% and it took over 5 years for it to get back those losses. I know everyone says you can't time the market but if you are in the early stages of retirement you have to think about capital preservation so you can catch the future upswing.
Right now, I am only 30% exposed in the market so I was outside when the cops arrived to the party. However, based on past experience with Parties that go very badly, I should slip away into the bushes while the paddy wagon rounds up party leaders. My wife and I have income from consulting deals for 2016. But, if we go into a recession some of that might go away in 2017. So, I am thinking of lightening up some more during the short rally's in 2016 and then probably going back in slowly in 2017. Of course, that may have to adjusted depending on the outcome of the elections.
How are some of the experienced longer term (retired 10 years or more) retirees viewing this situation?
So, looking back at 2007 thru 2009, the market corrected over 50% and it took over 5 years for it to get back those losses. I know everyone says you can't time the market but if you are in the early stages of retirement you have to think about capital preservation so you can catch the future upswing.
Right now, I am only 30% exposed in the market so I was outside when the cops arrived to the party. However, based on past experience with Parties that go very badly, I should slip away into the bushes while the paddy wagon rounds up party leaders. My wife and I have income from consulting deals for 2016. But, if we go into a recession some of that might go away in 2017. So, I am thinking of lightening up some more during the short rally's in 2016 and then probably going back in slowly in 2017. Of course, that may have to adjusted depending on the outcome of the elections.
How are some of the experienced longer term (retired 10 years or more) retirees viewing this situation?