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Old 01-21-2021, 09:10 AM   #61
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Let's go back to the 70s.

Now that was tough.
No doubt, but what’s happened since. So far it’s always been just a matter of time...
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Old 01-21-2021, 09:11 AM   #62
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I wish there was a measure of arrogance that we could graph.

I was with a tech company in the late 90s and we were all arrogant jerks. There was no way tech would fall, and we were 100% sure. I hedged my bets on my company by "diversifying" into other tech companies. What a great move. (sarcasm)

Today, it feels like the arrogance factor has reached some peak. Let's see where this goes.

I gotta tell you, the humble crap pie I ate in the early aughts was quite a wake up call. I'm somewhat ashamed of how I acted in the late 90s. It gives me a certain perspective of what I'm seeing right now.
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Old 01-21-2021, 09:15 AM   #63
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No doubt, but what’s happened since. So far it’s always been just a matter of time...
Yeah, I have no idea of when we'll have another 30s or 70s. I'm not saying we are on the verge of such now. No idea.

As a budding investor (thanks Dad!) in the 70s, I would graph my stock and the S&P every week. I also liked math. Frankly, I'm surprised I'm still in stocks. It was depressing. Luckily, I got involved in school and forgot about it for about 8 years (HS and College). When I got to the other side, things had finally recovered, and once I started making money, I kept with investing.
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Old 01-21-2021, 10:47 AM   #64
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If you were an investor in the 70's, would there still have been enough good years in there, that if you were diversified and rebalanced when things got too out of whack, that it could still have been a good decade?

I was just a kid then, so the only thing I really remember from a financial standpoint is in '79, when gasoline started getting rare and people were complaining about it going over $1/gal. But, IIRC, there was a mild recession around 1970 or 1971. 1972 and most of 1973 were good, but then the first oil embargo made a mess of things in 1974 and 1975. 1976-1978 were good years, and I think most of 1979 was, as well. As I recall, the oil embargo did start early in the year, but the market didn't react and crash until the fall.

Similarly, they call the 2000's a "lost decade", if you look at where the market was on 1/1/00 versus 12/31/09. But there were still plenty of peaks, valleys, and good times in there. I got a little burned by being invested too aggressively at the start of the Great Recession, but still did okay that decade. Of course, I did better in the following decade.
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Old 01-21-2021, 10:50 AM   #65
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I wish there was a measure of arrogance that we could graph.

I was with a tech company in the late 90s and we were all arrogant jerks. There was no way tech would fall, and we were 100% sure. I hedged my bets on my company by "diversifying" into other tech companies. What a great move. (sarcasm)

Today, it feels like the arrogance factor has reached some peak. Let's see where this goes.

I gotta tell you, the humble crap pie I ate in the early aughts was quite a wake up call. I'm somewhat ashamed of how I acted in the late 90s. It gives me a certain perspective of what I'm seeing right now.

In the late 90s, I did not have any money in the phony dot-coms, but I thought I was safe with the semiconductor stocks and the Internet infrastructure stocks. Nortel, Lucent, Global Crossing, Cisco, I had them all. Made good money until the bubble burst. Still, I hung on thinking my stocks were real, and not like dotcoms.

But, but, but, the "real" tech stocks all depended on the phony stocks to buy their hardware/software. When I could not take it anymore and bailed out of techs, had 57c on the dollar from the top instead of 22c like the Nasdaq.

Made back the lost money on material stocks when they rode high due to the housing bubble. Bailed out when the subprime hit, not very early but not too late, and did better that time. Heh heh heh...

I see the arrogance now in the EV and renewable energy segments. It's not easy to short them, so I just have to watch to see any sign of the bubble bursting spilling over to my own "real" stocks.

Not selling anything now, because the interest rate is still low. Back in 2000, the US Treasury was offering I-bond with a composite rate as high as 7.49% and people still snubbed it. Heck, they made that much in a day with their hot stocks. Buy, buy, buy...

PS. My current stock AA is below 60%. That's bearish for me, because I usually run 70-80% stock.
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Old 01-21-2021, 10:52 AM   #66
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Similarly, they call the 2000's a "lost decade", if you look at where the market was on 1/1/00 versus 12/31/09. But there were still plenty of peaks, valleys, and good times in there. I got a little burned by being invested too aggressively at the start of the Great Depression, but still did okay that decade. Of course, I did better in the following decade.
That was the Great Recession. You weren’t investing in the late 1920s were you?
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Old 01-21-2021, 11:05 AM   #67
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That was the Great Recession. You weren’t investing in the late 1920s were you?
Oops! I'm getting up there in years, but not quite THAT old! I guess they say the mind can be the first thing to go

(Note: I went back and corrected that little boo-boo)
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Old 01-21-2021, 11:23 AM   #68
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The Great Recession (aka "end of the world" by some) of 2008 emboldened me quite a bit insofar as worrying about a crash. Crashes/recessions come and go as do run-ups. I think it was Buffett who said that Wall St is the only market where people run out of the store when the price goes down.

In fact, unlike 2008, during the most recent March dip, I moved some stuff around and have netted 46% on what I moved (not the whole portfolio).

Print a graph of the Dow over the past 100 years, tack it to the wall, step back 20 feet and you'll see a pretty straight line in the positive direction.
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Old 01-21-2021, 11:45 AM   #69
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In the dotcom crash I went from 276k in net worth down to 15k. So I switched from dotcom/tech to S&P 500 index. I retired in early 2017 at age 51. Doesnt take a lot for me to live on. My net worth is up 62.5% since retirement. If the S&P 500 goes down 67% from where its at today my yearly spending would be 4.2% of that amount. My current yearly spending is at 1.4% of my current net worth(or 2.3% of my net worth at retirement in 2017).
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Old 01-21-2021, 11:58 AM   #70
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Print a graph of the Dow over the past 100 years, tack it to the wall, step back 20 feet and you'll see a pretty straight line in the positive direction.
Most people do not have 100 years left to live, let alone the geezers on this forum who do not buy unripe bananas and avocados.
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Old 01-21-2021, 12:38 PM   #71
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Who you calling a geezer, you young whippersnapper!?!
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Old 01-21-2021, 12:54 PM   #72
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Not selling anything now, because the interest rate is still low. Back in 2000, the US Treasury was offering I-bond with a composite rate as high as 7.49% and people still snubbed it. Heck, they made that much in a day with their hot stocks. Buy, buy, buy...
Yeah, I came late to that party, but did pick up some I Bonds before they became a joke. I made plenty of mistakes in my investing "c*reer". I look at missing the I-bond "top" as one of my bigger ones, but YMMV.
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Old 01-21-2021, 07:48 PM   #73
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Who you calling a geezer, you young whippersnapper!?!

Geezers are the ones who are 75+. I believe you are still a pre-geezer, like myself.


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Yeah, I came late to that party, but did pick up some I Bonds before they became a joke. I made plenty of mistakes in my investing "c*reer". I look at missing the I-bond "top" as one of my bigger ones, but YMMV.

I did not know about I Bonds until 2004, so also missed the nice, nice interest rate. But I am not sure even if I knew about the 7.49% I bond in 2000, I would buy some. That rate did not feel so impressive then, when compared to stocks.
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Old 01-21-2021, 07:49 PM   #74
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I live in CT and at Rentschler field, where the UCONN huskies play football, they have a massive Covid testing and vaccine lines. In fact they have three lines; one for testing, one for getting a shot and one for food. The food line I saw cars lined up at was incredible. We are in the twilight zone here and the next few years to me, regardless of P/E ratios, quant, free this or that are looking to be very strange days indeed, most peculiar momma. (Thx John Lennon)
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Old 01-22-2021, 05:33 AM   #75
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The markets are being propped up by central banks (QE, artificially low interest rates, and ever increasing debt). Stock buybacks, leverage and multiple expansion for the past 5 years are also a main driver. Risk taking and speculation is also in overdrive due to the "Fed backstop".



No idea how long it can continue. Maybe they'll start talking quadrillions in easy money instead of trillions, who knows. It's a huge Ponzi and will collapse on itself one day. Make no mistake, markets are up, but we are in no way a prosperous economy. Since 2008, we added $17T in debt. Most of America's wealth has already been transferred with things of value sold off or outsourced to other countries. Enjoy the fake prosperity while it lasts.
This guy gets it.
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Old 01-22-2021, 05:58 AM   #76
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The markets are being propped up by central banks (QE, artificially low interest rates, and ever increasing debt). Stock buybacks, leverage and multiple expansion for the past 5 years are also a main driver. Risk taking and speculation is also in overdrive due to the "Fed backstop".



No idea how long it can continue. Maybe they'll start talking quadrillions in easy money instead of trillions, who knows. It's a huge Ponzi and will collapse on itself one day. Make no mistake, markets are up, but we are in no way a prosperous economy. Since 2008, we added $17T in debt. Most of America's wealth has already been transferred with things of value sold off or outsourced to other countries. Enjoy the fake prosperity while it lasts.

Hummmm. Maybe I should sell tomorrow and put the cash under the bed.

If that were the case where everyone panics and sells then, what?
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Old 01-22-2021, 07:12 AM   #77
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During my accumulation years I was fine with letting my investments ride and continued buying with maximum 401k/403b investments. During the down years I was able to scoop up on the cheap. Later as I retired I felt my AA needed to change with my aging. My cash savings have increased to eventually reflect about 50% that would be more than enough to comfortably see me through to my expiration date even with inflation like 1980. Some of this was done by selling stocks that had not performed as expected, some by sales of MF that were getting to be too large a piece of the pie, and some was by taking dividends in cash instead of purchasing more stock. I view this as rebalancing. All of the stock/MF will stay to ride out any fluctuations since it will be inheritance.
If for some reason the market chases the bear then my powder is dry.


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The stock market highs
Old 01-22-2021, 08:04 AM   #78
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The stock market highs

Quote:
Originally Posted by JoeWras View Post
I wish there was a measure of arrogance that we could graph.

I was with a tech company in the late 90s and we were all arrogant jerks. There was no way tech would fall, and we were 100% sure. I hedged my bets on my company by "diversifying" into other tech companies. What a great move. (sarcasm)

Today, it feels like the arrogance factor has reached some peak. Let's see where this goes.

I gotta tell you, the humble crap pie I ate in the early aughts was quite a wake up call. I'm somewhat ashamed of how I acted in the late 90s. It gives me a certain perspective of what I'm seeing right now.

Robert Schiller at Yale does measure something like an arrogance index for U.S. stocks. It’s in a downswing at the moment.

[ATTACH]37463

They ask respondents:

“How much of a change in percentage terms do you expect in the following (use + before your number to indicate an expected increase, or - to indicate an expected decrease, leave blanks where you do not know): [Fill in one number for each]

1 month, in 3 months, in 6 months, in 1 year, in 10 years
Dow Jones Industrial---%---%---%---%---%
Attached Images
File Type: jpg IMG_0484.JPG (203.8 KB, 44 views)
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Old 01-22-2021, 03:40 PM   #79
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I wish there was a measure of arrogance that we could graph.

I was with a tech company in the late 90s and we were all arrogant jerks. There was no way tech would fall, and we were 100% sure. I hedged my bets on my company by "diversifying" into other tech companies. What a great move. (sarcasm)

Today, it feels like the arrogance factor has reached some peak. Let's see where this goes.

I gotta tell you, the humble crap pie I ate in the early aughts was quite a wake up call. I'm somewhat ashamed of how I acted in the late 90s. It gives me a certain perspective of what I'm seeing right now.
To conjure up all those self images, all I have to do is say one word: Lucent.
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Old 01-22-2021, 04:03 PM   #80
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To conjure up all those self images, all I have to do is say one word: Lucent.
Thank you so much for reminding us!
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