He is timing the market every time he makes a purchase or sale. He just foolishly believes price, age, time horizon, or a variety of other factors doesn’t matter.
It's just gambling.
Every time anyone buys or sells he/she/them/they are timing the market
Um...NOPE!
When you buy diversified mutual funds, there is NO CHANCE (short of a crook being involved like Madoff) that you will be left with ZERO money. With gambling, there is that chance on a bet. NOT gambling.
The market historically has gone UP 73% of the time, and over time markedly up.
Also, putting money in the stock market isn't the ONLY thing you should do to create your financial independence which takes even MORE pressure off investing.
You invest money today that you don't need today...into diversified mutual funds...as many different ones as you can buy, spread out into as many different sectors of the market as you can. You do this so that when you no longer have an income, you will have money to do stuff with. In addition to investing for your future, you should also make a plan to be 100% debt free including owning a home outright before you are retired. There are many decent places in this country that a married couple with no debt can live quite comfortably on just SS alone, so the extra that you invest is gravy, and it allows you to move from just barely being comfortable to being seriously comfortable.
UBS up 7% this morning in NY - that's good news. If acquirers don't get their heads ripped off that will bring confidence to the system. Maybe someone will be emboldened to buy first republic.
The rise in European bank stocks centers around the value of AT1 bonds. In overnight trading European bank stocks, and U.S. Futures traded down on contagion to other bank AT1 bonds. Then stimulating a rise in European banks, U.S. Futures, on European regulators saying AT1 bonds higher in the capital structure than other bonds, and above the CS common stock. I suspect the contagion spreads somewhere, since all of this is the fault of Fed deranged policies.
The rise in European bank stocks centers around the value of AT1 bonds. In overnight trading European bank stocks, and U.S. Futures traded down on contagion to other bank AT1 bonds. Then stimulating a rise in European banks, U.S. Futures, on European regulators saying AT1 bonds higher in the capital structure than other bonds, and above the CS common stock. I suspect the contagion spreads somewhere, since all of this is the fault of Fed deranged policies.
SP500 back above the 200 day. The whipsaw effect is brutal, but it usually is when the market is bouncing around the 200 day. Glad to see value getting a bid today - it's been a brutal time for value stocks.
The rise in European bank stocks centers around the value of AT1 bonds. In overnight trading European bank stocks, and U.S. Futures traded down on contagion to other bank AT1 bonds. Then stimulating a rise in European banks, U.S. Futures, on European regulators saying AT1 bonds higher in the capital structure than other bonds, and above the CS common stock. I suspect the contagion spreads somewhere, since all of this is the fault of Fed deranged policies.
SP500 back above the 200 day. The whipsaw effect is brutal, but it usually is when the market is bouncing around the 200 day. Glad to see value getting a bid today - it's been a brutal time for value stocks.
Ha, ha. In CS case the falling dominos got smaller, at least for equity investors. First Republic bonds to 10% yield, stock at new lows. Another area of mark to market stress has to be insurance company balance sheets, and pensions.
He is timing the market every time he makes a purchase or sale. He just foolishly believes price, age, time horizon, or a variety of other factors doesn’t matter.
Absolute BS.
1) I have not made a SALE yet of any of my stocks. Not a single penny.
2) I have only bought, bought, and bought some more, and since 1989, I have had a set amount that automatically went to retirement accounts, and I NEVER pulled back from my set amount (percentage) ever (though the set amount did change a couple times based on our financial circumstances at the time, but still a set amount, AND the set amount was never due to how the market was doing).
3) Once my wife retires, we will no longer buy any stocks at all. I will cease buying and will only take from my pile. If you'd like that say I am timing the market there just because I will be in my 60s at that point and have decided that THEN is the time to take from my retirement pile, then I MIGHT let you slide with that, but that really is NOT the definition of timing the market. Timing the market involves waiting to BUY until the market is at a level you think is good, or waiting to SELL until you think the market is at a level that is good. I have NEVER done that and never will. I will ONLY take money out of the market as I need it or want it. The only way I won't take money out of the market for a while is if there is a HUGE drop...like more than 50%. If that's the case, I will probably just live on SS and cash reserves for a while (I will have at least 3 years of cash reserves saved up when I retire) to give the market a chance to recover...and even then, that's not necessary that I do that...and depending on how old I am if that happens, I might not care and just take what I need anyway.
You make a lot of assumptions and assertions that are just flat wrong.
“The simplest thing that can be said about current financial market and banking conditions is this: the unwinding of this Fed-induced, yield-seeking speculative bubble is proceeding as one would expect, and it’s not over by a longshot.
I expect that FDIC-insured, and even most uninsured bank deposits will be fine. I also expect that hedged investments will be fine. In contrast, a great deal of market capitalization that passive investors count as “wealth” will likely evaporate, possibly including steep losses to bank shareholders and unsecured bondholders. Investors and policy-makers have confused speculation and extreme valuations with “wealth creation,” but it never was. A parade of seemingly independent “crises” will emerge as this bubble unwinds, including bank failures, pension strains, and market collapses, but they all have the same origin.”
749ish days ago the SP500 was exactly where it is today. That's a long time without a new high. 2+ years.
Which lowers the odds of more downside, but that's just odds.
Clearly we're in one of those long waiting periods between high returns. The question is if we can find something profitable to sit in while we wait, and not miss the rally once it starts. Whenever that may happen.
But nice to have short term bonds yielding 4-5% while we wait. That's a solid return.
A good indicator of where we go next should include watching FRC. Looks to be a bit wobbly.
maybe...or perhaps they fix FRC and then we forget this financial crisis.
Certainly FRC crashing is not hurting other financial stocks today, or the broad market. Broadly, today financials are up a percent while FRC is down 40%.
A good indicator of where we go next should include watching FRC. Looks to be a bit wobbly.
maybe...or perhaps they fix FRC and then we forget this financial crisis.
Certainly FRC crashing is not hurting other financial stocks today, or the broad market. Broadly, today financials are up a percent while FRC is down 40%.
Agreed. Short term indicator would have been a better phrase.
749ish days ago the SP500 was exactly where it is today. That's a long time without a new high. 2+ years.
Which lowers the odds of more downside, but that's just odds.
Clearly we're in one of those long waiting periods between high returns. The question is if we can find something profitable to sit in while we wait, and not miss the rally once it starts. Whenever that may happen.
But nice to have short term bonds yielding 4-5% while we wait. That's a solid return.
But, the odds also favor the market gets worse following the first Fed rate cut.
749ish days ago the SP500 was exactly where it is today. That's a long time without a new high. 2+ years.
Which lowers the odds of more downside, but that's just odds.
Clearly we're in one of those long waiting periods between high returns. The question is if we can find something profitable to sit in while we wait, and not miss the rally once it starts. Whenever that may happen.
But nice to have short term bonds yielding 4-5% while we wait. That's a solid return.
But, the odds also favor the market gets worse following the first Fed rate cut.
Do they? I've seen that the economy is about to go into recession when the curve de-inverts and the fed cuts rates, but is the first cut bad for stocks?
I suppose it's a sign of recession so that's not great. Question is if the market is willing to look over the earnings canyon of a recession.
I still say that this time is different - the post-pandemic period is just not like any other period and we should not use past periods as guides to the present. It could get worse than we expect or better, but this is simply a unique time, unlike others.
The closest is probably after WW2, when the GIs came back and wanted to spend money but the production lines were closed. As a result very high inflation that eased rather quickly as the invisible hand solved supply chain bottlenecks. I think that's roughly what's happening here.
The Swiss National Bank posted an annual loss of 132 billion Swiss francs ($143 billion) in 2022, it said on Monday, the biggest in its 115-year history as falling stock and fixed-income markets hit the value of its share and...
But, the odds also favor the market gets worse following the first Fed rate cut.
Do they? I've seen that the economy is about to go into recession when the curve de-inverts and the fed cuts rates, but is the first cut bad for stocks?
I suppose it's a sign of recession so that's not great. Question is if the market is willing to look over the earnings canyon of a recession.
I still say that this time is different - the post-pandemic period is just not like any other period and we should not use past periods as guides to the present. It could get worse than we expect or better, but this is simply a unique time, unlike others.
The closest is probably after WW2, when the GIs came back and wanted to spend money but the production lines were closed. As a result very high inflation that eased rather quickly as the invisible hand solved supply chain bottlenecks. I think that's roughly what's happening here.
I am speaking to the collapse of the last two bubbles where the Fed cut interest rates all the way down. The cutting is an attempt to slow the damage, which has largely already been done. I find it hard to argue this period is not far worse.
Do they? I've seen that the economy is about to go into recession when the curve de-inverts and the fed cuts rates, but is the first cut bad for stocks?
I suppose it's a sign of recession so that's not great. Question is if the market is willing to look over the earnings canyon of a recession.
I still say that this time is different - the post-pandemic period is just not like any other period and we should not use past periods as guides to the present. It could get worse than we expect or better, but this is simply a unique time, unlike others.
The closest is probably after WW2, when the GIs came back and wanted to spend money but the production lines were closed. As a result very high inflation that eased rather quickly as the invisible hand solved supply chain bottlenecks. I think that's roughly what's happening here.
I am speaking to the collapse of the last two bubbles where the Fed cut interest rates all the way down. The cutting is an attempt to slow the damage, which has largely already been done. I find it hard to argue this period is not far worse.
I suspect the critical difference is if there is a recession or not...rates get cut all the time without a subsequent recession.
Right now the economy is accelerating and growing at 3.2%, per the GDP Nowcast.
The financial crisis could slow that down, sure. But we have to wait for evidence of that.
In short, if rates are cut and no recession, stocks should be fine.
If rates are cut and we do have a recession, stocks may not be fine.
But always....stocks look out into the future, not what's happening now. In the psat very often stocks have overlooked earnings canyons. We could get that again. The median PE is something like 14 now...not very expensive overall.
749ish days ago the SP500 was exactly where it is today. That's a long time without a new high. 2+ years.
Which lowers the odds of more downside, but that's just odds.
Clearly we're in one of those long waiting periods between high returns. The question is if we can find something profitable to sit in while we wait, and not miss the rally once it starts. Whenever that may happen.
But nice to have short term bonds yielding 4-5% while we wait. That's a solid return.
But, the odds also favor the market gets worse following the first Fed rate cut.
Actually, if you go by history the odds favor the market having a great 2023. Going back to 1975, the market (ignoring 2000-2002) has always had a really good rebound following a bad year. Just like clockwork the market has had a great year following a bad year.
Interactive chart showing the annual percentage change of the NASDAQ Composite Index back to 1972. Performance is calculated as the % change from the last trading day of each year from the last trading day of the previous yea...
But, the odds also favor the market gets worse following the first Fed rate cut.
Actually, if you go by history the odds favor the market having a great 2023. Going back to 1975, the market (ignoring 2000-2002) has always had a really good rebound following a bad year. Just like clockwork the market has had a great year following a bad year.
I'm thinking we'll really tank in the morning...people are going to throw in the towel with yet another fail to break above the 200 day plus widening cracks in banking system popping up.
I'm going to eliminate my junk bond position - have to think bond spreads will widen now as people rush to own treasuries and recession fears grow.
Probably down 3-4% at some point today.
I am still positioning to do the same but haven't pulled the trigger yet.
For finding some place to park all the cash, thinking of going BIL ETF or somebody else was suggesting: Schwab Value Advantage Money Fund® Investor Shares (SWVXX) 7 Day Yield 4.4871%
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