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Jeremy Grantham, who granted is usually bearish, has a pretty good track record with his 7 year forecasts. He is predicting all U.S. equity markets will have negative returns over the next 7 years. He predicts the place to be is emerging markets, which will provide positive returns (which I agree with).
Wow. Not an encouraging outlook from Grantham. Good info though. Thanks.
Sure. I think it will eventually reach those Jan. highs and beyond. I sure hope so anyway. Millions of people are going to need that vehicle for their retirements. Even the military went to a blended retirement system with a 401k component.
I have 9 years (max) to retire and probably another 15 years after based on family history. I think I'll be alright if I can avoid major market downturns. And if that happens, the big question is when to get back in!
Days like today wear away at people's confidence.
A note of caution, European Union markets are closed today so that money isn’t flowing in and much of this is Amazon driven along with trade and a person may soon realize they stepped in it.
Grantham could be right as markets are often cyclical. I remember a well known forecaster back in 2008 saying this and I thought to myself that meant no positive returns till 2015. Seemed way too far to keep losing money in the market. We stayed for the ride and I’m glad we did. Right now we have a more conservative 40/60 allocation and most is with Fidelity. We shouldn’t need this money for 5 years (hopefully) so we are not going anywhere. But I certainly check what’s happening and hate to see any loss.
Grantham could be right as markets are often cyclical. I remember a well known forecaster back in 2008 saying this and I thought to myself that meant no positive returns till 2015. Seemed way too far to keep losing money in the market. We stayed for the ride and I’m glad we did. Right now we have a more conservative 40/60 allocation and most is with Fidelity. We shouldn’t need this money for 5 years (hopefully) so we are not going anywhere. But I certainly check what’s happening and hate to see any loss.
I think it's a pretty safe bet returns will be at least muted over the next 7 years.
At the best normal in historical terms when averaged.
Returns have been above normal for the last 7 years; I agree best case scenario is normal returns for the next 7. Many market gurus, including Bogle, are predicting below average returns, even for the next decade. But, who knows...
Jeremy Grantham, who granted is usually bearish, has a pretty good track record with his 7 year forecasts. He is predicting all U.S. equity markets will have negative returns over the next 7 years. He predicts the place to be is emerging markets, which will provide positive returns (which I agree with).
The US stock market has substantially outperformed that of most other countries, now for nearly 20 years. If we believe in a leveling-effect, then we're overdue for a rotation, where foreign markets thrive, while the US market stagnates.
Even in the US, returns were zero for 2000-2007 (negative, if adjusted for inflation) and around zero for the subsequent 7 years. It wasn't until around 2014 or 2015, that US large-caps finally retraced where they had peaked in 2000 (small-caps didn't have such a huge spike in 1999-2000). So, we've seen plenty of 7-year periods with zero or negative growth. This is all the more reason why, if we're on the threshold of another such period, the frustration would be intense.
Quote:
Originally Posted by TuborgP
At the best normal in historical terms when averaged.
Quote:
Originally Posted by Lizap
Returns have been above normal for the last 7 years...
Returns over the past 7 years have been outstanding, if we specifically set the demarcation-point 7 years ago. But let's keep in mind, that even as of today, returns since 2000 have been lackluster, and considerably below average. In the nadir of 2009, the market retraced where it was back in 1996, amounting to 13 years of zero returns (negative returns, if we include inflation).
But let's ask ourselves another question: suppose that an "investor" (more like a speculator) managed to perfectly time the markets, liquidating at the end of January 2018. What would said investor do for the next 7 years, assuming 7 years of flat or negative growth? Do bonds really sound promising? Really? How about real-estate? Even if interest-rates rise quite a bit, is there any reason to suppose that bank-deposits such as CDs will keep up with inflation? My point is, that there is really nowhere to hide. There are no good alternatives.
The US stock market has substantially outperformed that of most other countries, now for nearly 20 years. If we believe in a leveling-effect, then we're overdue for a rotation, where foreign markets thrive, while the US market stagnates.
Even in the US, returns were zero for 2000-2007 (negative, if adjusted for inflation) and around zero for the subsequent 7 years. It wasn't until around 2014 or 2015, that US large-caps finally retraced where they had peaked in 2000 (small-caps didn't have such a huge spike in 1999-2000). So, we've seen plenty of 7-year periods with zero or negative growth. This is all the more reason why, if we're on the threshold of another such period, the frustration would be intense.
Returns over the past 7 years have been outstanding, if we specifically set the demarcation-point 7 years ago. But let's keep in mind, that even as of today, returns since 2000 have been lackluster, and considerably below average. In the nadir of 2009, the market retraced where it was back in 1996, amounting to 13 years of zero returns (negative returns, if we include inflation).
But let's ask ourselves another question: suppose that an "investor" (more like a speculator) managed to perfectly time the markets, liquidating at the end of January 2018. What would said investor do for the next 7 years, assuming 7 years of flat or negative growth? Do bonds really sound promising? Really? How about real-estate? Even if interest-rates rise quite a bit, is there any reason to suppose that bank-deposits such as CDs will keep up with inflation? My point is, that there is really nowhere to hide. There are no good alternatives.
Grantham says emerging market stocks are the place to be..
I think that we will be OK if (and it is a big if) we can get away from amateur hour in the administration, when it comes to the economy. When you have a Treasury Secretary who apparently doesn't know that a line item veto was ruled as unconstitutional by the Supreme Court, it doesn't give one much hope. And Larry Kudlow as the new economic adviser? Wow!
I think that we will be OK if (and it is a big if) we can get away from amateur hour in the administration, when it comes to the economy. When you have a Treasury Secretary who apparently doesn't know that a line item veto was ruled as unconstitutional by the Supreme Court, it doesn't give one much hope. And Larry Kudlow as the new economic adviser? Wow!
Not sure Kudlow was a good choice. He's a huge advocate of China tariffs.
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