Can you say, Recession? It just started! (insurance, credit, buy)

[Kurt]

Have you seen the Asian market tallies? And the index futures for the U. S.?

Tomorrow morning it will hit Wall Street like a Tsunami. I am in big cap equities and will ride it out. But for the next 18 months and at least through the election cycle it looks bleak.

At first "dead cat" bounce you might convert some equities into fixed income if nearing retirement like me.

I have a bad feeling in my gut on this one. It is not the end of the world but we may see some nasty capitulation.

Say a prayer. We will need them!

[usafwx]

I can tell I wont get much work done tomorrow b/c I'll be staring at my 401k balance dropping. Just wonder if I can stomach it and ride it out. I'm only 40 so I've got plenty of time but it still makes me wonder if I should move out of my stocks and into some bonds.

[sierraAZ]

Originally Posted by Kurt

Have you seen the Asian market tallies? And the index futures for the U. S.?

Tomorrow morning it will hit Wall Street like a Tsunami. I am in big cap equities and will ride it out. But for the next 18 months and at least through the election cycle it looks bleak.

At first "dead cat" bounce you might convert some equities into fixed income if nearing retirement like me.

I have a bad feeling in my gut on this one. It is not the end of the world but we may see some nasty capitulation.

Say a prayer. We will need them!

Yeah, read about it. I got out of the market in September when the Air Force stand-down was ordered. Might've been a bit early, but it looks like an OK idea now.

[KevK]

We are not in a recession. We have not had even one quarter of negative growth and it takes two to be in a recession. What securities markets do is often irrational and has no bearing on reality. The credit markets are a mess and we may experience a slow down to sort things out but it will not be the end of the world.

[RoaminRed]

Originally Posted by Kurt

Have you seen the Asian market tallies? And the index futures for the U. S.?

Tomorrow morning it will hit Wall Street like a Tsunami. I am in big cap equities and will ride it out. But for the next 18 months and at least through the election cycle it looks bleak.

At first "dead cat" bounce you might convert some equities into fixed income if nearing retirement like me.

I have a bad feeling in my gut on this one. It is not the end of the world but we may see some nasty capitulation.

Say a prayer. We will need them!

Prayers have nothing to do with it, and it's not going to be as bad as you're predicting.

[belovenow]

Originally Posted by usafwx

I can tell I wont get much work done tomorrow b/c I'll be staring at my 401k balance dropping. Just wonder if I can stomach it and ride it out. I'm only 40 so I've got plenty of time but it still makes me wonder if I should move out of my stocks and into some bonds.

If you're well diversified in stock funds which aren't too agressive risk-wise, don't go selling them today trying to get into bonds... you'll just cement your portfolio losses. Much better off realizing this is a cyclical thing and the big picture is one in which the economy will get better, what you buy for the remainder of this month at least is really on sale stock price-wise, and as long as you weren't planning on retiring this year or next you ought to be ok just riding this out.

[humboldtrat]

Originally Posted by usafwx

I can tell I wont get much work done tomorrow b/c I'll be staring at my 401k balance dropping. Just wonder if I can stomach it and ride it out. I'm only 40 so I've got plenty of time but it still makes me wonder if I should move out of my stocks and into some bonds.

I wouldn't worry about it. In the month of October, 1987 alone, the stock market lost 1/3 of its value (500 pts. in one day) only to come back strong in the 1990's. Look at the drop in the stock market as a "buying opportunity" to pick up more stocks at lower depressed prices. You won't be needing your 401k money for another 20 - 25 years, so don't worry about it.

[Dd714]

Originally Posted by usafwx

I can tell I wont get much work done tomorrow b/c I'll be staring at my 401k balance dropping. Just wonder if I can stomach it and ride it out. I'm only 40 so I've got plenty of time but it still makes me wonder if I should move out of my stocks and into some bonds.

If you don't have the stomach to ride it out (risk tolerance) you should not be investing in equities.
Put your money under a pillow or bury it in the back yard if you can't get work done due to the periodic recession spells (which seem to occur every 7 or 8 years). Shift your 401k's based on long term trends and based on changing risk tolerance as you age. Drastic changes are a mistake.

[Kurt]

Well, I did not expect Bernanke to react so fast. We are not out of the woods, yet. I still suggest those who are near retirement to buy some bonds if there is a bit of a bounce in the markets in the near future.

As to prayer, I think people who believe in it should do so and not have those who do not comment on it. If you don't believe in prayer then take it as a figurative statement only.

Now, let's get back to the Fed. It is certainly no Sunday School!

[ESFP]

Yep, seems the market always bounces back. A broker friend of mine uses the line, "If you like it at 30, you'll love it at 20." I don't bottom fish, but try to catch the price after the first good bounce. If you're solvent, think of the threat of recession as a buying opportunity. Things do look dismal, with oil prices, Iraq, trade-deficit, worthless dollars, insurance... Things look bad, especially for the middle-class (what's left of them). This country is resilient. Never panic.