Dow over 28,000!

[Lsbcal]

It feels really good and that is a bit worrisome (if you are a worrier type).

But then the market is not showing a rising slope over the recent few years like happened in periods like the late 1990's and prior to the 1987 crash and the late 1920's. I don't know what will kill this market but it isn't obvious to me.

I updated my decades chart just a few days ago and here it is. It is getting a little hard to read with the addition of some more decades. Note the blue line for our decade has had a fairly constant slope i.e. fairly constant growth rate over recent years.

FWIW, I bought more stocks a week ago. Make golden hay while the sp500 shines.

 

[NW-Bound]

LOL - the big alarm bell here is the phrase, "It's different this time". It almost never is!

Holymoly. I just looked at my balance, and I'm at 963K! Not a great deal for many here, but it's the most I've ever had. Now, I'm thinking that if I hadn't bought my campervan, I'd have around $985K now, and be within spitting distance of that magic number. Dagnabbit - how dare I spend money on something I was going to enjoy? What was I thinking! All I want is, when I'm living in my van down by the river because my portfolio took a deep dive, that I once had a million dollars - even if I only had it for a day

Of course, it's a bit silly, because the difference in income and portfolio survivability between 1M and what I have now is minimal but, as they say, it's the thought that counts. The thought that I have a cool 1M. OK, I'll stop thinking about money now, but that is part of the point of this forum.............

What you would do is to look at net worth, and you include the RV in that net worth. See, you have not lost any money.

And then, because you have done some work on it, its value is now higher than what you paid for it. You are not that far from that $1M mark.

 

[Major Tom]

And then, because you have done some work on it, its value is now higher than what you paid for it. You are not that far from that $1M mark.

Good point - and older Airstreams like mine tend to keep their value. The major depreciation has already happened.

 

[dixonge]

We retired just over two years ago. Since then (8/30) S&P is up 27.7%. Brokerage account is up almost double that due to fairly regular contributions.

 

[targatom2019]

Make sure you take a screen shot of that 1st 1 mill. I saw my 1st 1M for just one day in January 2018 and did not see it again until July 2019.

 

[ejman]

Over the next decade (prediction made in 2011), Mr. Bogle said stocks are likely to generate an average annual return, including dividends, of around 7%. “Your money will double in 10 years,” he said. https://www.mymoneyblog.com/jack-bogle-makes-market-prediction-for-next-decade.html. Of course, the decade is not over yet, maybe his prediction will turn out to be optimistic.

 

[NW-Bound]

Not a Boglehead, but I like the late Bogle's even-mindedness in the face of market doom alternating with hysteria. About his 7% market return, it is far less than what we have had so far from 2011 to 2019. The S&P has grown almost 2.9x, for an annual growth rate of 12.6%. Will the market pull back soon, or next year, in order to revert to the mean?

Of course no one knows exactly, and Bogle along with others like Buffett would never claim they could tell what the market would do in the short term. But a look at past annual returns perhaps will remind us what move the market is capable of. Following is the past performance of VTSAX (Vanguard Total Market).

2011: 1.08%
2012: 16.38%
2013: 33.52%
2014: 12.56%
2015: 0.39%
2016: 12.66%
2017: 21.17%
2018: -5.17%
2019: 22.53% YTD

We had some unbelievable years, like 2012/2013/2014. The years 2016/2017 are also spectacular. I don't remember what made 2018 so bad, but the market crash at this time last year was awful. And it was short-lived too. The market is schizophrenic.

 

[tmm99]

Over the next decade (prediction made in 2011), Mr. Bogle said stocks are likely to generate an average annual return, including dividends, of around 7%. “Your money will double in 10 years,” he said. https://www.mymoneyblog.com/jack-bogle-makes-market-prediction-for-next-decade.html. Of course, the decade is not over yet, maybe his prediction will turn out to be optimistic.

I think he was predicting much lower, something like 4% return in 2015. I think I heard him say something similar last year...

 

[NW-Bound]

The lower return number was after inflation, I believe. Inflation rate was 2.4% in 2018.

 

[MichaelB]

The instructions (below) sure sound like prorating to me.

Complete the Additions to Income area using Instruction 12. If you had losses or adjustments to income on your federal return, write on line 5 those loss or adjustment items, which were realized or paid when you were not a resident of Maryland.
Complete the Subtractions from Income area using Instruction 13. You may include only subtractions from income that apply to income subject to Maryland tax. Include on line 13 any income received during the part of the year when you were not a resident of Maryland.
You must adjust your standard or itemized deductions and exemptions based on the percentage of your income subject to Maryland tax. Complete the Maryland Income Factor Worksheet to figure the percentage of Maryland income to total income. The factor cannot exceed 1 (100%) and cannot be less than zero (0%). If line 1 is 0 or less, the factor is 0. If line 1 is greater than 0 and line 2 is 0 or less, the factor is 1.
If you itemize deductions, complete lines 17a - 17b of Form 502. Prorate the itemized deductions using this formula: Net itemized deductions X Maryland income factor = Maryland itemized deductions. Enter the prorated amount on line 17 of Form 502 and check the Itemized Deduction Method box. Another method of allocating itemized deductions may be allowed. Please send your written request along with your completed Maryland return, a copy of your federal return including Schedule A and a copy of the other state's return. If the other state does not have an income tax, then submit a schedule showing the allocation of income and itemized deductions among the states. The Maryland return must be completed in accordance with the alternative method requested. This request should be sent to the Revenue Administration Division, Taxpayer Accounting Section (Special Allocations), P.O. Box 1829, Annapolis, MD 21404-1829.
If you are not itemizing deductions, you must use the standard deduction. The standard deduction must be prorated using the Maryland income factor. Calculate the standard deduction using the worksheet in Instruction 16 of the tax booklet. Prorate the standard deduction using the following formula: Standard deduction X Maryland income factor = Prorated standard deduction. Enter the prorated amount on line 17 of Form 502 and check the Standard Deduction Method box.
The value of your exemptions (line 19) must be prorated using the Maryland income factor. Use this formula: Total state exemption amount X Maryland income factor = Prorated exemption amount. Enter the prorated exemption amount on line 19 of Form 502.
You must prorate your earned income, poverty level and refundable earned income credits (if you qualify) using the Maryland income factor. See Instruction 26 in the Maryland tax booklet to see how the factor is applied.

From instruction 13, Maryland 2018 tax forms and instructions (my bold) (here)

Line 12. NONRESIDENT INCOME. If you began or ended your residence in Maryland during the year, you may subtract the portion of your income received when you were not a resident of Maryland. See Instruction 26 for part-year residents and Administrative Release 1 for military personnel.
If your state of residence or your period of Maryland residence was not the same as that of your spouse and you filed a joint return, follow Instruction 26 (c) through (p).

Instruction 26 just sends you back to instruction 13. It’s a loop.

Other types of payments might need to be prorated but capital gains and dividends have a declaration and pay date, and you only need to include that income if you were a resident of the state on the pay date.

From your post, you will need to prorate the deductions taken from your federal return. Not the income, though.

To not further hijack the thread, if you want to to continue we can start a new thread.

 

[pb4uski]

Over the next decade (prediction made in 2011), Mr. Bogle said stocks are likely to generate an average annual return, including dividends, of around 7%. “Your money will double in 10 years,” he said. https://www.mymoneyblog.com/jack-bogle-makes-market-prediction-for-next-decade.html. Of course, the decade is not over yet, maybe his prediction will turn out to be optimistic.

Huh

Well, it is looking pretty pessimistic so far... $10k invested in VTSAX on Sept 10, 2011 would be worth $31,319 at yesterday's close... a 14.95% annual return over the first 8.2 years after the article was published.

VTSAX Vanguard Total Stock Market Index Fund Admiral Shares Fund VTSAX chart

 

[NW-Bound]

I took ejman's post as saying there's still some time left in the decade for the market to crash, and make Bogle's outlook optimistic.

Darn, that would be a hard crash.

 

[pb4uski]

^^^ Yeah, 36%! Yikes!

 

[NW-Bound]

And given all the previous "Wh***" posts, I still see on the Web people saying nobody rings the bell at the market top or bottom.

Ha! Those unfortunate souls don't know, because they don't frequent this forum.

 

[ejman]

I took ejman's post as saying there's still some time left in the decade for the market to crash, and make Bogle's outlook optimistic.

Darn, that would be a hard crash.

Yes, that's what I meant. The decade isn't quite over yet and the theme of this thread has something to do with a W**** something or other...

 

[W2R]

And given all the previous "Wh***" posts, I still see on the Web people saying nobody rings the bell at the market top or bottom.

Ha! Those unfortunate souls don't know, because they don't frequent this forum.

Thank you very much, kind sir!

Actually I really don't have a functioning crystal ball. But if you all want to believe that I do, that's fine with me. At the bottom of this post is the one that I actually do have on my mantel. Years ago I found it hidden away in a dusty old antique/junk shop in Ponchatoula, Louisiana.

Moving on, today the Dow is up AGAIN!!! 28,036 . My portfolio is at an all time high AGAIN!! By over a thousand dollars compared with Friday, too. I simply love this and would never have predicted it in a million years.

 

[JDARNELL]

W2R at least when things go south please post back that picture

 

[W2R]

W2R at least when things go south please post back that picture

This one?

 

[dtbach]

I've been working this year selling equities and buying bonds to get my AA to 66/29/6. I think over the last 6 years it had ballooned to 84/12/4. The taxes won't be bad because 90% of it was in tax sheltered accounts.



I know its "dirty market timing" but it does let me sleep a bit better.

 

[JDARNELL]

This one?

Yep
That’s the one.

 

[W2R]

Yep
That’s the one.

OK, things haven't gone south but I got some PMs from other people tonight saying they also want her back, and I like her too. So, I'll switch my avatar back to that one for a little while.

She is actress/model Eva Habermann, and the avatar was one of the default avatars that we could choose from when we had the old software here. I love how caring and concerned and thoughtful she seems in that photo, and I wish I had her good looks. But I get tired of having to tell people that she is not me! So I usually don't keep the avatar for very long.

 

[Montecfo]

I really don't believe in this stuff but I am selling everything anyway.

 

[audreyh1]

I really don't believe in this stuff but I am selling everything anyway.

 

[Perryinva]

Wow. In 2007 laddered CDs were 5.75%! I didn’t remember them being that high only 12 years ago.

 

[Andre1969]

Wow. In 2007 laddered CDs were 5.75%! I didn’t remember them being that high only 12 years ago.

I wouldn't be surprised. I remember being able to get something like 5-5.5% on a money market account at Emigrant Direct bank, at that time.

The sudden drop in rates those MM accounts were paying caused a bit of an argument with my family. My Granddad died in late 2016 and my Dad, who had been taking care of Granddad, passed away about 6 months later. When some of the relatives were going through Granddad's papers, they found some old income tax statements, and one of them tried to imply that my Dad had somehow made about $1M "disappear".

Their rationale was that Granddad's taxes, from around 2007-2008, showed something like $7-8000 in interest being paid out that year. They estimated that would mean Granddad had around $1M or more saved up. I told them that no, you're thinking of CURRENT interest rates (they were still below 1% in early 2017, I believe). At the interest rates they were paying back in 2007-2008, you would have only needed about $150K or so to get that.

Of course, they didn't understand what I was talking about.