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Ironically the people who believe in the sky is falling have not sold their stocks.... I guess they can't walk the talk... We all know a recession is going to happen... The doomsday talkers keep saying tomorrow every day until it happens and claim they were right... Even though they were wrong....
no one knows when . we all know it will happen but predicting when is a fools game . most long term investors have no need to predict when . just go pedal to the metal and ride it through . if you got enough time you will still likely grow the most money with 100% equities .
but for those retired and spending down it is a different world . volatility and down years ain't your friend and while a safe withdrawal rate will likely not fail , your balance is heavily influenced by not returns but sequence risk .
the only thing you can do is allow for uncertainty and not try to rule it out
the ability to make more than 3-4% is negated . absolutely not . it has shown double digit gains at times regularly.
this is the 25% equity version of the permanent portfolio vs the 60/40 i was using from 2007 to 2017 . . even that 25% equity version had double digit gains and was up when stocks got hammered . that is because gold and long term treasuries are just as capable of double digit gains as equities are .
WELL..Then the risk HAS to be there too..you act like its got only an upside. Not possible or everyone would do it. The days of double digit gains in long term treasuries are OVER. No way. Gold? Yes it will come back.
oooh that is where you are likely wrong . like night follows day you can bet your bottom dollar when the next part of the cycle hits you will see long term treasuries soar again . it is the premier asset for a flight to safety unless we have hyper inflation . you can pretty much set your watch to it . i am of the opinion that when we hit the 2nd half of the cycle we can test the long term treasury bond lows we so in the last downturn .
a mere 1% drop in rates is about a 20% gain in TLT
oooh that is where you are likely wrong . like night follows day you can bet your bottom dollar when the next part of the cycle hits you will see long term treasuries soar again . it is the premier asset for a flight to safety unless we have hyper inflation . you can pretty much set your watch to it . i am of the opinion that when we hit the 2nd half of the cycle we can test the long term treasury bond lows we so in the last downturn .
a mere 1% drop in rates is about a 20% gain in TLT
I cant argue that in crisis people will go back..I just cant see a yearly double digit increase anymore especially with rising rates from the Fed.
never confuse raising short term rates with the fear ,greed and inflation perception that bond investors see . since the 1980's every time with one exception in 1994 that the fed raised interest rates 1% or more in a year , bonds had an up year .
this is the 10 year . the long term bond moved way more . raising short term rates put the brakes on inflation and long term bonds like that . that is why the short term rates are close to the long term rates . a 10 year and 30 year have little difference because these increases are seen as good for capping inflation and longer term bond investors like that .
i see at least a 20% gain in tlt for a 1% drop in rates in a flight to safety
oooh that is where you are likely wrong . like night follows day you can bet your bottom dollar when the next part of the cycle hits you will see long term treasuries soar again . it is the premier asset for a flight to safety unless we have hyper inflation . you can pretty much set your watch to it . i am of the opinion that when we hit the 2nd half of the cycle we can test the long term treasury bond lows we so in the last downturn .
a mere 1% drop in rates is about a 20% gain in TLT
The difference now is we are near historical lows in rates, so when a recession comes, stocks will suffer and bonds will do better, but not as well as they did in the past since rates are near historical lows.
The difference now is we are near historical lows in rates, so when a recession comes, stocks will suffer and bonds will do better, but not as well as they did in the past since rates are near historical lows.
Yea..that is all was trying to say. Thanks. I DO AGREE MATHJAK with past experience during down times.
If you need growth from your portfolio and have a long time horizon own stocks! and a big % of them!
Stay invested my friends!
Agree..on long time horizon. But if your time is now, I'd be petrified to be in anything more than a defensive position.
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