Worst December since Great Depression

[Andre1969]

That depends on how you measure a "lost year". For me, that would be an overall market return that is negative for the year. On that basis, the market returned about 1.4% in 2015 and was last negative in 2008.

Apparently you are only considering the Dow Jones or S&P 500?

I think that's about what I made in 2015, around 1.4% or so. Once you factor in inflation, it probably *was* a "lost" year. But, oh well, the market has to take a breather every once in awhile.


And, it's going to vary from person to person, as to how well or bad you do compared to the market, overall. Personally, 2011 was also a "lost" year for me. I was down something like 0.2%.

 

[RAE]

Predictions (from the "experts") are for the overall markets to drop another 20% in 2019

You can find any kind of "expert prediction" you want for next year, but personally I would not be surprised if the markets go basically nowhere next year. Lots of headwinds out there, in addition to the tariff thing. Just yesterday I read that student loan debt is over twice what it was in 2009. The housing market is going into the tank now too. The extra income boost from the tax bill is just about over now, also. And although the unemployment numbers are okay, wages have still not risen very much.

And then there are the geopolitical issues that may be coming to a head soon, which I won't go into, but which could cause all sorts of turmoil.

So, lots of obstacles out there for 2019, as I see it. I would not want to have a lot of exposure to this market right now.

 

[Breedlove]

Markets do what they do , a sad question where do you put your money . Can't just leave it under the bed . I will hang tight and grit my teeth.

 

[Helena]

.

Thank God, I was able to retire comfortably at age 55... and eleven years later my nest egg has doubled... all without playing the risky stock market.

.

 

[RAE]

Predictions (from the "experts") are for the overall markets to drop another 20% in 2019

Some interesting thoughts/predictions here from Stan Druckenmiller. I haven't researched him to see what his long-term record is, but apparently he has made some correct calls over the years. Basically, he is predicting the market to "struggle" for the next 3-5 years. He also sees interest rates falling from here, which is why he is buying more Treasuries.

https://www.bloomberg.com/news/arti...ckenmiller-doesn-t-know-where-markets-go-next

Again, just posting this to show another opinion. If you don't agree, don't shoot the messenger........

 

[Looking4Ward]

SI haven't researched him to see what his long-term record is, but apparently he has made some correct calls over the years....

Hmmmmm...........

"Druckenmiller, now 65, was considered the greatest hedge fund manager of his generation. He used a gift for seeing macroeconomic signals in stock and bond prices to predict the last four recessions and generated average annual returns of 30 percent for three decades with no down years."

 

[daylatedollarshort]

Hmmmmm...........

"Druckenmiller, now 65, was considered the greatest hedge fund manager of his generation. He used a gift for seeing macroeconomic signals in stock and bond prices to predict the last four recessions and generated average annual returns of 30 percent for three decades with no down years."

That sounds a lot like Bernie Madoff's (self proclaimed) track record.

 

[jazz4cash]

Yeah but Bernie never bought or sold anything. He just reported “results”. That’s why they’ve been able to clawback around 70%.

 

[CRLLS]

Dec isn't all bad. This Dec is a good time for Roth conversions. At lower prices, more shares can be converted for a given dollar amount. Or alternatively, lower prices means less impact on taxes and other income based Fed programs.

 

[audreyh1]

I thought Dec 2002 had been pretty nasty, but I suppose Oct or Nov must have been the bad months.

But I do think it's pretty rare for Dec to be a negative month.

Dec 2018 is not over yet!

 

[OldShooter]

I dunno. My December has been quite pleasant. Weather has been a little warmer than average, our health continues to be good, and we are committed to a cooking class in Italy in February and an Eastern Europe trip in May. Maybe Southern Africa in August. The market? Down a bit, but these things happen from time to time and never amount to much.

 

[Free bird]

Livin large

 

[RobLJ]

Well, the S&P after Dec 24th was down about 10.5% for the month (give or take a few 10ths), so I guess that qualifies as a minor flesh wound, now.

 

[target2019]

Wonder if I can use this as an excuse to sit out work until next year?
Yeah boss, this is my worst December since the Great Depression.
LOL. I guess any excuse is as good as another.

 

[DEC-1982]

Reviewing the chart you provided, I noticed a name that rang a bell, Jeff Gundlach. On 7/30/16 he said "Sell everything". I remembered this article from CNBC yesterday. "Jeffrey Gundlach says passive investing has reached a 'mania' – investors should avoid index funds"

What should one think when the Bond King says "Sell everything else, and buy bonds"? Of course, he may turn out to be right this time.

 

[joeea]

Some interesting thoughts/predictions here from Stan Druckenmiller. I haven't researched him to see what his long-term record is, but apparently he has made some correct calls over the years. Basically, he is predicting the market to "struggle" for the next 3-5 years. He also sees interest rates falling from here, which is why he is buying more Treasuries.

https://www.bloomberg.com/news/arti...ckenmiller-doesn-t-know-where-markets-go-next

Again, just posting this to show another opinion. If you don't agree, don't shoot the messenger........

"apparently he has made some correct calls over the years" - is something you could say about anyone.

Let's not get too starry-eyed about one big name pundit.

"At the peak of the technology boom in 1999 and 2000, Mr. Druckenmiller makes a big bet on Internet stocks. He was a huge buyer of VeriSign, which fell by about 50 percent in a month. The bursting of the dot-com bubble in March 2000 crushes Quantum’s portfolio, prompting Mr. Druckenmiller to quit his post managing the Quantum Fund after a dozen years. At the time, he said: “We thought it was the eighth inning, and it was the ninth. I overplayed my hand.”"

 

[audreyh1]

What should one think when the Bond King says "Sell everything else, and buy bonds"? Of course, he may turn out to be right this time.

Well Gundlach had also been warning about treasuries reaching 6% until recently.

Now he warns about owning corporate and below investment grade bonds.

So not much left to buy.....

Really don’t understand the warning about indexing.....

Of course an active fund manager will always criticize passive investing.

 

[Running_Man]

Predictions (from the "experts") are for the overall markets to drop another 20% in 2019

Who are these experts? On 12/24 CNBC posted the expected stock results for 2019 and of the top 30 Wall Street Firms 30 expected the market to be up in 2019. So the people with the most money and their customers are fully invested in the equity markets for 2019 or should be if they are letting their money managers influence their allocation.

 

[Chuckanut]

Reviewing the chart you provided, I noticed a name that rang a bell, Jeff Gundlach. On 7/30/16 he said "Sell everything". I remembered this article from CNBC yesterday. "Jeffrey Gundlach says passive investing has reached a 'mania' – investors should avoid index funds"

Here's another voice as of 12/21:

https://humbledollar.com/2018/12/three-questions/

It’s also looking increasingly like a decent buying opportunity. If this turns out to be a full-fledged bear market, history suggests the peak-to-trough decline will be around 35%, so we could have a long way to go. Still, for the first time during the current selloff, I did some serious buying both today and yesterday, moving 2% of my portfolio from bonds to stocks. If the stock market keeps falling, I’ll be doing even more buying in the weeks and months ahead.

https://creativeplanning.com/blog/three-questions/

 

[Andre1969]

I thought Dec 2002 had been pretty nasty, but I suppose Oct or Nov must have been the bad months.

But I do think it's pretty rare for Dec to be a negative month.

Dec 2018 is not over yet!

I just checked my records out of curiosity. For some reason, I didn't keep much data from 2002 in my spreadsheet, although I did hit my bottom for the year (and that particular recession) in July 2002. I was actually up around 23% from that point by 11/21/02...some of that was from additional investments, so it wasn't all market improvement, but in general, it looks like things were on the mend.

My next data point that I saved was 1/2/03. At that point my NW was down about 1.4%. Again, there were additional investments in there (although not enough to sway things too much), but it looks like the last part of November, and December, was a slightly "cool" period, market-wise. Nothing like this current December, though!

Still, I'm sure we were destined to get something like this, eventually. My biggest complaint is that I don't really have much money sitting on the sidelines waiting to come in and play, like I did back in 2000-2002 and 2009!

 

[audreyh1]

I just checked my records out of curiosity. For some reason, I didn't keep much data from 2002 in my spreadsheet, although I did hit my bottom for the year (and that particular recession) in July 2002. I was actually up around 23% from that point by 11/21/02...some of that was from additional investments, so it wasn't all market improvement, but in general, it looks like things were on the mend.

My next data point that I saved was 1/2/03. At that point my NW was down about 1.4%. Again, there were additional investments in there (although not enough to sway things too much), but it looks like the last part of November, and December, was a slightly "cool" period, market-wise. Nothing like this current December, though!

Still, I'm sure we were destined to get something like this, eventually. My biggest complaint is that I don't really have much money sitting on the sidelines waiting to come in and play, like I did back in 2000-2002 and 2009!

Oops, I was thinking about Dec 2000! Yes, Dec 2002 was the start of recovery.

 

[mamadogmamacat]

Wow DOW is on fire as the trading day ends

dead critter bounce (sorry could not quite bring myself to say "cat") or the beginning of a true return to upswing?
who the heck knows, but was nice for today

 

[steelyman]

The daily bipolar behavior of the stock market for a while now really gets tiring (to me, anyway). It’s at least somewhat better to look at stats that incorporate a smoothing function (like moving averages).

 

[pb4uski]

Yeah, he's a real prophet. Just keep repeating it until you get a result you want. I think the markets just wanted an excuse to keep selling.

+1. If he is still right in 6 months or advises buy between now and 6 months from now then we'll give him some credit.

 

[pb4uski]

Predictions (from the "experts") are for the overall markets to drop another 20% in 2019

Equals a buy signal.