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Old 01-08-2021, 10:37 AM   #61
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Between this thread and the FOMO thread I finally got of my butt to start my rebalance.

Thanks folks!
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Old 01-08-2021, 11:16 AM   #62
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Not selling anything yet, because my stock AA at 57% is low compared to the 70-80% I usually carry.

I am very leery of the crazy stocks with stratospheric P/E, and even some with no products, no sales let alone any earnings. When they crash, the effect may spill over to my "innocent" stocks.

I will continue to monitor closely to decide what to do when people start to cry out loud for losing money in the above hot stocks.

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Old 01-08-2021, 03:01 PM   #63
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What happens to equity markets when this chart returns to its pre-pandemic level?

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Old 01-08-2021, 03:20 PM   #64
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Not selling anything yet, because my stock AA at 57% is low compared to the 70-80% I usually carry.

I am very leery of the crazy stocks with stratospheric P/E, and even some with no products, no sales let alone any earnings. When they crash, the effect may spill over to my "innocent" stocks.

I will continue to monitor closely to decide what to do when people start to cry out loud for losing money in the above hot stocks.
And here I was so bullish until I saw this version of the Etrade baby. LOL!!

Seriously I am bullish and at max allocations in stocks. Have been for some months now.
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Old 01-08-2021, 04:05 PM   #65
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What happens to equity markets when this chart returns to its pre-pandemic level?

Maybe it won't. Quite possible that a one income family might become more common. Or maybe one full time and one part time.
Less pre-made food, less lawn and cleaning service, less child care outsourced. A few people have realized they've been taking home less than they thought.
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Old 01-08-2021, 04:24 PM   #66
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I wish our long term plans included more "secure" income streams such as a decent pensions. At 50/50, we are now at the lowest stock allocation in our lives. The portfolio and 2xSS will be the only things keeping DW and yours truly out of the poorhouse. The plan works here, but having baked a nice retirement cake, I really really wanted a thick layer of icing. If we have a significant correction before I give up w*rk, then we may consider 60/40.

Having lost everything in the dot.com crash, I never ever again want to be put into the position of telling DW that we are broke. In 2004 I restarted the "plan" and this time I used common sense. If financial devastation comes our way again then it WILL NOT be because I did not educate myself and practice risk management.

Today we are at 2.9m. When we drop 50% again I hope to refer back to this post and smile because I took steps to avoid the despair felt during my first failed attempt at financial freedom.
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Old 01-08-2021, 04:49 PM   #67
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That E*TRADE commercial reminded me of a clip from South Park.
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Old 01-08-2021, 08:12 PM   #68
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I'm watching our stock allocation creep up since March to now 47 (I had diminished it to 42% in Feb in fear of a COVID crash--and 39% in March when I put some of cash back into equities to get back up to 42%; it may have hit 37% but I was too afraid to look at the bottom), and in fact since I'm more bullish on international/Asian (due purely to value), I stuck 1% in international and probably will do so again.

At 55% I'll rebalance to 52% or thereabouts (if we get there) since I qualify for SS and can withdraw from DW's IRAs next year, so I'm a lot less concerned about SORR than I was the last 5 years. If we have a 5-10% downturn, I'll probably stick some cash in small caps since they seem more of a value.


I have no clue on interest rates/inflation since I expected a burst since '09 and we really haven't seen it.
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Old 01-08-2021, 08:49 PM   #69
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...

I have no clue on interest rates/inflation since I expected a burst since '09 and we really haven't seen it.
From Liz Ann Sonders (Schwab):

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So, I get the question all the time: What about inflation? Why haven’t we had inflation in light of all of this massive stimulus? And the answer is, well, we've had plenty of it, it's just been in asset prices, not in the real economy.
I don't know about others but we are planning on getting a new car as soon as the vaccine is in our arms. And there are other planned spendings. For sure we will travel and .... spend like drunken sailors. Haven't consulted DW on that last thought.
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So much bullish sentiment
Old 01-09-2021, 11:03 AM   #70
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So much bullish sentiment

^^^^^. Hmmm. Sonders’ observation is pretty undeniable, no?

What are the implications?
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Old 01-09-2021, 11:15 AM   #71
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It took me 30 years to figure out that nobody in the investment business knows anything useful. Now DW and I watch Mr. Market and just laugh. The trend is our friend -- the trend over the years, that is. Everything else is just noise.
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Old 01-09-2021, 11:46 AM   #72
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For myself that is why AA is so important. If we have a downturn I will have the patience not to sell, and if equities do well I can still participate in the gains. I will be the first to admit I will not do as well as if I were fully invested in equities, but I also will not suffer the full wrath of the market when it turns down.
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Old 01-09-2021, 11:49 AM   #73
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^^^^^. Hmmm. Sonders’ observation is pretty undeniable, no?

What are the implications?
Considering that QE has been around since 2010, and markets really took off in 2013 after massive QE was added, seems like we’ve been here before.

Except that QE never ended - only a little of it was reversed - so we still don’t know the implications! Except that CPI inflation keeps staying low while asset inflation keeps going up. But no one knows how this ends.
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Old 01-09-2021, 11:50 AM   #74
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I have usually been about 85% stocks but am sitting around at 50% right now, 50% cash. I think there is the potential for the market to go higher but the risk is just not worth it.

I am confident that I will miss out on some gains and confident also that I will be able to snap up some bargains. My bet this year is volatility.
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Old 01-09-2021, 11:58 AM   #75
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I just do not see any other place for my money besides stocks. My gut tells me that the market is too hot, as does the fact that I have been checking my 401K daily lately (this is a sure sign that the end times are coming). But isn't it awesome to see paper gains in 1 day equal to a months salary?

I concur with what seems to be the consensus that low interest rates and a supportive fed will continue to provide support for the market, until it doesn't (meteor strike, China invades Taiwan or someplace else, Nancy Pelosi announces she is carrying Mitch's love child).

If I get 5+ up the next couple of months, I will probably take some off the table and wait for a pull back.
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Old 01-09-2021, 12:03 PM   #76
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I'm not feeling particularly bullish: what I am feeling is nervous.
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Old 01-09-2021, 12:35 PM   #77
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This thread is full of lots of hope and lots of pessimism. What's missing is that the leaders we pick and the initiatives we support and promote will have a lot to do with our future at all levels, even for retirees.

We've been living off the spoils of the past for much of my life. One example - when I was a younger man the country got behind building an interstate highway system, and it transformed our economy. The deterioration of such infrastructure is not only sad to watch but dangerous. New initiatives around infrastructure, properly managed, would transform our economy, and change our future.

Cynicism is a popular habit, but not productive and not supportive of economic well-being at any level.
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Old 01-09-2021, 01:29 PM   #78
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In 2020 the SP500 was up 18.4%. Very nice in a tumultuous year. But the markets have not gone into an exponential ascent like in early 2000.

I think most of us are having trouble dealing with this in an unemotional way.

My guess is the market broadens out if the vaccines quell the Covid cases. So not so much a sell off in growth stocks but perhaps slower growth with value stocks moving up too. Actually in the last quarter value stocks have done about the same as growth stocks. And even international stocks have done similarly.
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Old 01-09-2021, 09:48 PM   #79
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I concur with what seems to be the consensus that low interest rates and a supportive fed will continue to provide support for the market, until it doesn't (meteor strike, China invades Taiwan or someplace else, Nancy Pelosi announces she is carrying Mitch's love child)...
Pelosi getting pregnant at her age of 80? That would be a true miracle.
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Old 01-09-2021, 10:40 PM   #80
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No professional investors that I read say the market is too hot, too expensive or not broad enough. On the contrary.

Does everyone agree the economy is not producing at its full potential?

What happens to equity markets when the economy is producing at full potential, whenever that may be? Will the market be higher, or lower?
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