Spoken like a typical Stock Market Analyst.[emoji16]
How does this decline compare to previous recessionary ones?
- Thread starter Lsbcal
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Spoken like a typical Stock Market Analyst.[emoji16]
easysurfer
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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My gut says this is the big one 
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.My gut says this is the big one
If this is a serious statement and not a tongue-in-cheek, twinkle-in-the-eye statement, what we talking about when you say "big one"? Knowing that 2003 was a 50% flogging, and 2008/09 was even more. You really think the market will fall that much +?
OP
OP
Lsbcal
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
The average decline has been about -32% with a time span of 367 days. See this article by Ben Carlson: https://awealthofcommonsense.com/2022/09/navigating-the-pain-of-your-first-bear-market/
FloridaJim57
Recycles dryer sheets
I know this is not a political forum so I will refrain from saying what I really want to say out of respect for that policy. But IMO this recession is different than other ones in one very simple way: It could have been easily avoided and was very easy to see coming. All the ducks were lined up and the chips fell where they had to. Delete this if it is offensive or political.
This kind of data was the first thing I started looking up last Jan/Feb. This doesn't look like an average or ho-hum market correction. Too much else going on. Here, I'm more interested in easysurfer's educated guts since he or she used the term "big one". Personally I'm not yet convinced this will be that big.
To get back on-trend from last big meaningful dip (2009) would put it at about ~2800. That's about a ~42%'er. Given its bubble-esque nature + a spell of inflation (Not convinced yet of the gloom & doom, inflation forever hang-wringing predictions either) ~42% +/- doesn't seem unwarranted.
~2800 would take us back to early 2018, only 5-5 1/2 years (depending on when we bottom-out) and not even as low as 2019 or COVID 2020.
Historically, if you like seeing patterns in things, 10-15 years from now we will re-visit this bottom, so that will be the big wipe-out like 1929, 1974, 2009. But I will be sort of dead or so old I won't know it.
RetireAge50
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copyright1997reloaded
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A 60/40 Portfolio of US Stocks/Bonds is down 19.3% in 2022, on pace to become the 2nd worst year in history after 1931.
https://twitter.com/charliebilello/status/1573683627375951878?s=21&t=mA1JWcyB9WVYnTCRG7FgxA
https://twitter.com/charliebilello/status/1573683627375951878?s=21&t=mA1JWcyB9WVYnTCRG7FgxA
F.I.R.E User
Thinks s/he gets paid by the post
What about data from 1800’s?
Markola
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Good chart. On the bright side, look 1933-36.
Koolau
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Since my AA was about 30+% stock, a 50% haircut would cut my port by about 15% to a first approximation - just about the same as its buying power has already been cut by inflation over the past 2 years.
harllee
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
I am glad I have a lot of cash in CDs etc and a pretty big SS check (waited until age 70 to claim). I learned my lesson in 2008 when I did not have enough liquidity and could not sleep at night. Now I sleep fine. The economy is cyclical and there is a recession about every 10 years so we are due for one.
There is an extreme amount of debt worlwide that needs a constant fuel of cheap money growth and real economic productivity growth to feed it.
The fiat money system and euro-dollar markets have created this extreme inbalance.
We have entered the point of decades of bad monetary and fiscal policy where we now have the choice of breaking things and causing a debt collapse or accepting systemic inflation.
A lot of people think central banks will first break something, and use that as an excuse to turn back on the money spigots which will cause a loss of faith in fiat.
I don't know how this ends (or when), but there is no easy solution.
The best solution is to tighten monetary policy and suck all the speculation and debt out of the system, and rebuild an economy on investment, savings and capital. I don't think we have the stomach for that transition.
The fiat money system and euro-dollar markets have created this extreme inbalance.
We have entered the point of decades of bad monetary and fiscal policy where we now have the choice of breaking things and causing a debt collapse or accepting systemic inflation.
A lot of people think central banks will first break something, and use that as an excuse to turn back on the money spigots which will cause a loss of faith in fiat.
I don't know how this ends (or when), but there is no easy solution.
The best solution is to tighten monetary policy and suck all the speculation and debt out of the system, and rebuild an economy on investment, savings and capital. I don't think we have the stomach for that transition.
GravitySucks
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I'd need a chart of an allocation of 60% land / 30% hog / 10% feed
aja8888
Moderator Emeritus
My bold above. And if we don't have the stomach, what are the choices? Hyperinflation? Loss of Reserve Currency status? Additional Wealth Effect for the top 0.01% and poverty for everyone else?
copyright1997reloaded
Thinks s/he gets paid by the post
I think you answered your own question as to a possible outcome.
Worsening inflation (I'm just avoiding using the "hyper" term, at least for now)
Loos of Reserve Currency status - Right now, the "Best house in a bad neighborhood" (but eventually even the king will fall)
Additional Wealth Effect for the top/poverty for everyone else? Instead of "Let them eat cake" it will be "Let them eat bugs". Haven't you heard? It is our fault by wanting a big house, by wanting meat, by having the audacity to want to travel or use an evil dinosaur juice vehicle!
And the "everyone else" will be DEMANDING it (i.e. printing money and "help")
I think this is most likely. Been doing so for as long as I can remember.
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Rocky mtn high
Recycles dryer sheets
Fed says we have a long ways to go. That’s all I need to hear. Usually don’t like Cramer but he is right the Fed wants to take our net worth away!
Gearhead Jim
Full time employment: Posting here.
The posts above seem to be saying that "this time it's different", and the US (and the world) will experience disaster instead of be unable to muddle through with just some serious pain.
There are good reasons for the doom and gloom scenarios, but I'm expecting that this time won't be much different, and in 2-5 years life will have changed, as it always does, but most of us in the US will still be doing OK.
Please check back in 2027.
There are good reasons for the doom and gloom scenarios, but I'm expecting that this time won't be much different, and in 2-5 years life will have changed, as it always does, but most of us in the US will still be doing OK.
Please check back in 2027.
Nah, Cramer is full of crap as usual.
If you follow his "logic" then all the net worth you have accumulated has been given to you by the Fed and, if so, your net worth has been unjustly "earned." Do you believe that?
Northforker
Recycles dryer sheets
To take all of our net worth away, the fed will have to bankrupt corporate America that we are all invested in, and they will have to bankrupt the FDIC that insures our cash savings and fixed income investments. There will be a lot of pushback before that happens.
W2R
Moderator Emeritus
I think things may be considerably more difficult in the years to come, but we are up to the challenge. My guess is hyperinflation, but who knows? Anyway, with whatever choices are made by TPTB, most of us will manage somehow. (Others will whine and demand freebies).
But as a group we can do amazing things, and we always have. Our ancestors survived the Great Depression and two World Wars, and still maintained a decent attitude after going through all that. Previous ancestors before that settled, civilized, and upgraded the wilderness. We can not only get through whatever gets thrown at us, but survive and thrive.
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I was talking to Jerome Powell. He doesn't want everyone's net worth. Just yours. Sorry to be the bearer of bad news.
Koolau
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Nope, the easiest way to take away net worth is to inflate the currency. You still have the same dollars but they are worth less - thus net worth is taken from you silently. YMMV
