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Who learns that? Seriously? that's a very serious question. I'm also fairly new to this whole game, as my wonderful husband of 30 years was the investment guru??
but the first thing I learned and the first thing my sons learned is that the stock market does and will go down. or where you saying that as a joke.
I lived through the crash of 08 but I stuck to my overall game plan, didn't freak out and pull out, keep with the dollor cost averaging so I continued to buy stocks and did well.
Are you advising folks to not be in the market? (also a real question)
Now as far as can we trust the central banks?? are we supposed to be trusting them?
Here's my attitude. Now trusting the central banks is not imperative to my goals. my goals pretty much are to pad my accounts as much as I can in the next 20 months while I'm working and protect the things I've managed to save up to that must last me for the next 30-35 years.
Nothing as of today has convinced me that the dollar will become worthless, we will run out of oil and inflation will hit 20% in the next 10 years. that's as long term as I can handle right now.
question? so you think this is a massive ponzi scheme, what are you doing? are you just staying in cash, buying tons of gold?
I am not giving anyone advice. I do not know what the stock market really is, but many people who have studied the subject believe it is NOT what we are supposed to think it is. The central banks have the job of trying to stabilize markets. But nothing prevents them from going too far and trying to control the markets.
People who tend toward being libertarian with regard to economics (which I am) are very skeptical about what the Fed has been doing, especially since 2008. There are some who believe the market is inflated, and that if the Fed ever dares to stop inflating it, there would be a tremendous crash.
The stock market is supposed to reflect the state of the economy. If it doesn't, then no one can begin to guess what will happen.
There is nothing crazy about what I have been saying, it isn't necessarily non-mainstream, if you happen to be a libertarian or conservative.
I am not giving anyone advice. I do not know what the stock market really is, but many people who have studied the subject believe it is NOT what we are supposed to think it is. The central banks have the job of trying to stabilize markets. But nothing prevents them from going too far and trying to control the markets.
People who tend toward being libertarian with regard to economics (which I am) are very skeptical about what the Fed has been doing, especially since 2008. There are some who believe the market is inflated, and that if the Fed ever dares to stop inflating it, there would be a tremendous crash.
The stock market is supposed to reflect the state of the economy. If it doesn't, then no one can begin to guess what will happen.
There is nothing crazy about what I have been saying, it isn't necessarily non-mainstream, if you happen to be a libertarian or conservative.
I definitely was not saying the things you say are crazy but we have had a tremendous crash. In 08 and no one but a few folks would have predicted that.
My point is the market, country and the world seemed to have survived that, no I am not discounting that many folks were hurt financially.
Now actually I have a fairly libertarian/independent bent in my leanings but imo that's neither here nor there. as I said, I based my decisions upon my goals. My primary goals right now are to increase my net worth, protect myself for longevity while allowing for growth.
those goals drive me to stay in the market. if it crashes again, i'll reevaluate.
I definitely was not saying the things you say are crazy but we have had a tremendous crash. In 08 and no one but a few folks would have predicted that.
My point is the market, country and the world seemed to have survived that, no I am not discounting that many folks were hurt financially.
Now actually I have a fairly libertarian/independent bent in my leanings but imo that's neither here nor there. as I said, I based my decisions upon my goals. My primary goals right now are to increase my net worth, protect myself for longevity while allowing for growth.
those goals drive me to stay in the market. if it crashes again, i'll reevaluate.
Yes we had tremendous crash in 08 but it was followed by EXTREME QE. That means we cannot guess what comes next.
Yes we had tremendous crash in 08 but it was followed by EXTREME QE. That means we cannot guess what comes next.
Are we trying to? like I said, i'm learning but a few of the "truism" that seem to be often repeated is that 1) don't try to time the market and 2) no one knows what the market will do?
so is the goal of investing to try to figure out what the market will do and then invest?
The stock market is supposed to reflect the state of the economy.
No it is not.
No one who has any grasp of economics or finances would make such a silly statement that is factually incorrect.
The stock market is nothing more than a partial display of where investors are allocating capital.
#1 The stock market loses 40.9% of its "value" over a period of 959 days. Characterize the state of the economy during that time.
Spoiler
GDP growth was averaging an astounding 12.5% per quarter
That actually happened September 1939 to April 1942
If you said the economy was performing in any way less than stellar, you failed.
#2 The stock market sets records over a period of 651 days. Characterize the state of the economy during that time.
Spoiler
That was the 3rd and final recession of the Eisenhower Administration, and the final recession of the Great Depression, which ended in 1961.
The DJIA doubled in value from 250 to 500+.
This is proof -- one of a dozen examples where they stock market soared, while the economy tanked.
Another famed occurrence was the 1928 Recession -- which ended June 1929 and the stock market started crashing, with a huge crash in October 1929.
#3 The stock market loses 45.1% of its value over a period of 694 days. Characterize the economy.
Spoiler
That was January 1973 to December 1974. US GDP grew at rates of 1.03% per quarter to as much as 3.77% per quarter, averaging 2.24% per quarter over those 8 quarters.
While the economy wasn't stellar, it was still average or slightly better by any benchmark.
As everyone can clearly see, there is absolutely no relationship whatsoever between the stock market and the economy.
Are we trying to? like I said, i'm learning but a few of the "truism" that seem to be often repeated is that 1) don't try to time the market and 2) no one knows what the market will do?
so is the goal of investing to try to figure out what the market will do and then invest?
Yes, investors like mathjak here have figured out that long term stocks always go up. Their prediction is based on the past. If the present differs in some way from the past, they don't consider that.
Yes, investors like mathjak here have figured out that long term stocks always go up. Their prediction is based on the past. If the present differs in some way from the past, they don't consider that.
But G4N, sorry I'm on my phone so i type badly.
Anyhoo, most predictions are based on the past.
Your credit report is based on past behavior. Your auto insurance takes into account your past behavior.
I don't know anyone here personally so I can't speak for them but I do know how to analyze things. So if I'm looking for some thing to make money 20 years from now I can look around and see what's the best opportunities for that. Now I also consider the "What ifs" and try my best to plan for those. Now do I consider the possibility of a market crash sure. Do I plan for the US economy going away?? Not so much.
But G4N, sorry I'm on my phone so i type badly.
Anyhoo, most predictions are based on the past.
Your credit report is based on past behavior. Your auto insurance takes into account your past behavior.
I don't know anyone here personally so I can't speak for them but I do know how to analyze things. So if I'm looking for some thing to make money 20 years from now I can look around and see what's the best opportunities for that. Now I also consider the "What ifs" and try my best to plan for those. Now do I consider the possibility of a market crash sure. Do I plan for the US economy going away?? Not so much.
We've had a very artificial situation for quite a while. When I planned for retiring, I didn't know interest rates would be this low for this long. To compensate for that, I bought long term CDs with not too bad interest, which I will pay the penalty on if interest goes way up in the mean time. And I work part-time, whenever I can find part-time work that I like.
Not having stocks doesn't make me poor. Having stocks, considering all the unprecedented interventions since 2008, would possibly make me poor and would certainly make me anxious.
However, if stocks really crash I would put some money in an index fund, but only a small percent of my total.
It is true that anything can happen, and the United States could go bankrupt, all banks fail, or God knows what. But all that is unlikely and not worth worrying about.
What I am worried about is QE. Some people, who have studied this in depth, think QE is an addictive trap the Fed will never be able to escape.
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