U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Economics
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 04-22-2011, 12:01 PM
 
Location: West Orange, NJ
12,545 posts, read 19,510,734 times
Reputation: 3712

Advertisements

Quote:
Originally Posted by user_id View Post
It has? Unless you have a time machine how could you determine that?

I find it funny how on one hand people stress the long-term, yet speak as if they've some how realized short-term swings in the market.

How good the market is for young investors depends on the markets performance over the next 2-3 decades, not the performance over the last 1-2 years.
true, but i'm personally pretty confident that the long term outlook will be fine. the facts of the past decade are that things were getting quite expensive. homes, stocks, everything. the economic downturn provided me with an opportunity to stop investing at a higher price level and get in at a lower price level. unless our economy gets progressively worse over the next 2-3-4 decades, then this will work out for younger investors. i'm not concerned with where my account is today, i'm just of the mindset that the past couple years have been an opportunity to buy some funds more cheaply than the prior couple years offered.

so no, i don't know for a fact that is has...but i'm making an educated guess that it was.
Rate this post positively Reply With Quote Quick reply to this message

 
Old 04-22-2011, 12:12 PM
 
Location: Conejo Valley, CA
12,470 posts, read 18,212,762 times
Reputation: 4343
Quote:
Originally Posted by bradykp View Post
the facts of the past decade are that things were getting quite expensive. homes, stocks, everything. the economic downturn provided me with an opportunity to stop investing at a higher price level and get in at a lower price level.
It provided you with an opportunity to invest at a price that was lower than the past price, whether or not this is in fact a "lower price" in the long-term is an open question.

Anyhow, yes, you are making a guess, but I'm not sure about the educated part. You haven't even begun to address why equities as a whole are a good bet long-term, that is, in the future.

If the DOW on average appreciated by 7~8% over the next 30 years it would be valued at 100,000, where as the inflation adjusted price would be around 20,000~25,000. That is, it would be 4 times more expensive than today, do you expect real earnings to be 4 times greater in 2040 than they are today?
Rate this post positively Reply With Quote Quick reply to this message
 
Old 04-22-2011, 12:19 PM
 
Location: West Orange, NJ
12,545 posts, read 19,510,734 times
Reputation: 3712
Quote:
Originally Posted by user_id View Post
It provided you with an opportunity to invest at a price that was lower than the past price, whether or not this is in fact a "lower price" in the long-term is an open question.

Anyhow, yes, you are making a guess, but I'm not sure about the educated part. You haven't even begun to address why equities as a whole are a good bet long-term, that is, in the future.

If the DOW on average appreciated by 7~8% over the next 30 years it would be valued at 100,000, where as the inflation adjusted price would be around 20,000~25,000. That is, it would be 4 times more expensive than today, do you expect real earnings to be 4 times greater in 2040 than they are today?
i don't know that i'm expecting 7-8% returns. when i run my models and assumptions for retirement i go based on 6% assumed avg return. to be safer, i check a 5% return as well. i'm not invested solely in the U.S., so i'm not completely tied to the DOW. i realize it won't be easy, and i recognize things are fundamentally different going forward than they were in the past, but there are still many areas for growth in the world. i'm partially going based on past avg returns, i've adjusted my expectations to be more conservative than the typical estimates are, and i've taken to looking past just the U.S. for investments.

what approach would you take? i'm curious.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 04-22-2011, 04:38 PM
 
Location: Victoria TX
42,661 posts, read 78,558,068 times
Reputation: 36332
WSJ? Jumping on for the ride?

Here's a parallel:

"The cheerleaders say we'll have a great team this year, and more and more people are buying tickets to the big game."

The Dow is not an indicator of anything except how many people are jumping on for the ride. and many of them jump when the WSJ tells them to. The Dow passed 1,000 in 1983. I remember 1983, and where I was and what I was doing. Funny, but I don't feel like my nation's economy, nor my own, is 12 times as strong as it was then.

Maybe when the cheerleaders at WSJ (knowing what is good for their advertising clients) whip up enough enthusiasm and people jump on their bandwagon, an inaccurate picture results.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 04-22-2011, 07:28 PM
 
8,265 posts, read 11,213,531 times
Reputation: 4788
Don't be silly the WSJ prints plenty of negative views and gloomy predictions related to the economy.

I doubt you even read it.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 04-22-2011, 07:37 PM
 
12,799 posts, read 16,492,586 times
Reputation: 8823
High energy prices will goose the manufacturing sector as more drilling rigs and pipe are needed. As the dollar weakens, it will become economical to manufacture in the US.
Rate this post positively Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics
Similar Threads

All times are GMT -6.

© 2005-2021, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top