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Dow Jones index peaked on Feb 12 at 29551. DJI penetrated the 20% mark, the traditional definition of bear market, on Mar 11. We are now officially in a bear market.
Suppose DJI continues to slide to the low of this bear market. What would be the start date of this bear market?
How do we define Bear Market? It seems to me to have to be based on longevity of being down from the last high. So if you say Feb 12 as the peak, then we are only a month away from it.
My thought is at least a 8 months down from Feb 12, 2020. So Oct 13, if Mr. Dow has not shown a new high, we are in Bear Market.
No more traditional pensions to count on, many workers put their money in 401K and rely on the mercy of the market to finance their retirement. If there is a bear market, it won't last long because there is a lot faithful worker bees' money sitting in 401K and mutual funds that has to be invested.
No more traditional pensions to count on, many workers put their money in 401K and rely on the mercy of the market to finance their retirement. If there is a bear market, it won't last long because there is a lot faithful worker bees' money sitting in 401K and mutual funds that has to be invested.
It may be pretty bad.
I have a friend who retired around '04. He was doing well until the 07-08 recession hit.
He has no pension and was not 65 so he was forced to sell portions of his 401k as it shrank. The result was catastrophic, and he never really recovered.
Some of it is dumb luck. Retire one year, and you're safe forever; retire another and you are doomed from the beginning.
A BEAR MARKET has duration. Lasting a full generation. It is much more painful than a CRASH, which can be a sudden loss of 20-38%, with a recovery and new highs in 6 months.
1929-1947 = bear market
1965-1983 = bear market
2001-2019...was supposed to be a BEAR MARKET, but the FED fudged it with stolen money from the future.
A BEAR MARKET has duration. Lasting a full generation. It is much more painful than a CRASH, which can be a sudden loss of 20-38%, with a recovery and new highs in 6 months.
1929-1947 = bear market
1965-1983 = bear market 2001-2019...was supposed to be a BEAR MARKET, but the FED fudged it with stolen money from the future.
Good Luck!!!
Interesting statement. I'd like to take a look at what you have read.
Reference of some sort?
Some of it is dumb luck. Retire one year, and you're safe forever; retire another and you are doomed from the beginning.
Some is luck for sure.
But there are also tools available for free (firecalc is one of them) that allow the user to see how long their investments would last given different criteria, including every market cycle that has ever occurred since the stock market started in 1871.
The idea is that if you have a portfolio that would have weathered the worst economic cycles over the last 149 years and you wouldn't have run out of money before you ran out of time, then you have a solid portfolio that should see you through retirement. Even if that's not enough comfort, a user can model even worse conditions than what's already occurred in the history of the market, and determine how they'd do and how much $$$ they should have as a starting portfolio nest egg. Ideally someone would determine the nest egg number required to give them a better than 90% chance before they decide to retire, so they can keep working if they need more $$$ saved.
It may be pretty bad.
I have a friend who retired around '04. He was doing well until the 07-08 recession hit.
He has no pension and was not 65 so he was forced to sell portions of his 401k as it shrank. The result was catastrophic, and he never really recovered.
Some of it is dumb luck. Retire one year, and you're safe forever; retire another and you are doomed from the beginning.
As a person approaches retirement, he/she is supposed to gradually reduce the weight of equities, so when a crash like this occurs, their portfolio should not take the full hit. So, the theory still holds, no?
As a person approaches retirement, he/she is supposed to gradually reduce the weight of equities, so when a crash like this occurs, their portfolio should not take the full hit. So, the theory still holds, no?
Retirement allocations tend to range from a very conservative 40% up to 65% for equities, but there are many who are quite comfortable with a >65% equity allocation.
This is obviously a bear market. A bear market is typically defined as broad indexes being 20% or more off of recent highs. Add in the level of pessimism that exists, and if this isn't a bear market, we've never had a bear market.
For crying out loud, we've had three of the biggest drops in the last 33 years within the last week!
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