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It's not that they are pessimists. It's that they think the 'savings account' and earning interest on it is sacrosanct while every other form of investment and the earnings they return are fraudulent.
except that a 1 year cd has had negaive real returns 1/3 of all the years the last 50 and negative real returns 40% of the time when taxes were figured , so they lost money .
on the other hand over any long term accumulation period which typically spans decades , diversified equity funds never lost money
But there have been plenty of shorter-than-the-longest-possible spans in which equities have lost money on the basis if net real return after fees and taxes. If you happen to run into one of those just when you need the money, things can be a bit antsy.
equities should never be an investment for the short term . that is bad investor behavior. that is what cash and bonds are for .
however even that being the case , studies show that even a retiree who spent down from 100% equities in good and band times did just about as well as a 50/50 mix in fact so close as to be just about the same results . the reason is without the weight of cash and bonds in the up markets the cushion developed is so much higher.
the additional spending caused by selling shares that are down was really no problem because of the higher cushion and amounts achieved in 100% equities . . .
in fact out of 116 30 year cycles when drawing out 4% inflation adjusted 50/50 did 1 cycle better than 100% equities did . going out longer in retirement 100% equities beat 50/50 by a cycle .
Last edited by mathjak107; 06-22-2017 at 01:01 PM..
equities should never be an investment for the short term . that is bad investor behavior.
My point was that it's quite easy to find extremely long time-frames, or to note Point-A to Point-B intervals that make investing in stocks look like taking candy from a baby. Just pick up a few brokerage brochures. But investing in the the real world is quite a bit more complicated and dangerous than that. This is why it is questionable whether an individual should ever invest in anything more complex than a major index fund. As the one-time "day trader" era should have rather plainly demonstrated, markets are a place where the big guys don't wait around for lunch -- they simply eat the little guys for breakfast.
Quote:
Originally Posted by mathjak107
in fact out of 116 30 year cycles when drawing out 4% inflation adjusted 50/50 did 1 cycle better than 100% equities did . going out longer in retirement 100% equities beat 50/50 by a cycle .
Who selected the equity portfolios? Or was it major index funds that were examined rather than stocks themselves?
there is noooooooooo typical accumulation stage which typically spans decades where any investor ever lost money in diversified funds .
as far as day trading , i love trading for fun . i use funds for my portfolio but keep some dough to trade with . i dart in and out of things like gold , oil and long treasuries almost daily . i have yet to be eatin by the big guys
they are volatile and after a big drop something always spooks them back up even for a day .
i have posted my trading statement here many times for those who wanted to see my loses and think i don't disclose them . .
i have been in and out of GLD trading gold 30x since january as of todays trade netting 27k in profits .
my trades since january are coming up on 73k in profits with a few hundred in losses . the biggest loser verizon actually paid a 235 dollar dividend so it is 235 less . they missed earnings the day after i bought so i sold it out ..
if i trade stocks i will typically buy after a steep fall and try to catch a bounce . if not i am out within a day . things like gold or long term treasuries i don't mind holding waiting for the markets to spook if i have to . they always do .
here this is my statement from january but does not include this months trades yet which were all profitable .
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Last edited by mathjak107; 06-23-2017 at 01:47 PM..
i always like trading . i am not confident enough in my ability to trade full time especially in retirement . i can't count on things always going my way or even being trade able at times but i will take some calculated shots trading in and out of certain things.
i don't mind holding certain things like gold or long treasury bonds if i have to , but i much prefer to profit and run . wait for a roll back and repeat .
The economy never "truly" recovered from 2008, this is apparent in most parts of the country, people are poorer in general.
It's certainly apparent here in Denver, average person i know lives paycheck to paycheck and struggles under the very high rents here.
If we lived in a "truly" good or booming economy, things like rents would be stagnant or going down, not up.
The economy never "truly" recovered from 2008, this is apparent in most parts of the country, people are poorer in general.
It's certainly apparent here in Denver, average person i know lives paycheck to paycheck and struggles under the very high rents here.
If we lived in a "truly" good or booming economy, things like rents would be stagnant or going down, not up.
I have never heard the theory that rents go down with a booming economy.
I am not sure why the people you know are having it so difficult. The statistics and bragging from your governor indicate the Colorado economy is booming and unemployment is the lowest in the nation at under 3%.
The economy never "truly" recovered from 2008, this is apparent in most parts of the country, people are poorer in general.
It's certainly apparent here in Denver, average person i know lives paycheck to paycheck and struggles under the very high rents here.
If we lived in a "truly" good or booming economy, things like rents would be stagnant or going down, not up.
Our economy has been DEAD since 2001 when economic expansion ended, when business cycle ended. We have been in depression ever since and the FED has been masking this fact with money printing and with artificially low interest rates. We have wasted trillions and trillions of dollars trying to FAKE ECONOMIC GROWTH and nothing is working. That is because our economy can't grow organically unless we go thru depression and deflation first. We have to destroy all this bad debt first. The Fed knows this. But what can the Federal Reserve do now? They kept rates near zero for the whole cycle. Only now do they realize that this is dumb. Clearly raising rates at the end of the cycle is dumb. However, not raising them for the rest of the cycle is dumber. What to do?
These Morons at the Fed are raising rates now because to enter an even mild downturn at below 1% rates is horrifying.
Good Luck to you all, as I said earlier very soon all you will be worrying is your own and your loved ones survival. You won't see any real organic economic growth until Deflation and Depression is allowed to do it's job.
Sorry to pop your bubbles and happy retirement dreams. But when it happens remember you were the ones who cheered for this insanity, who protected this current madness.
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