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Author Topic: Dow Crash Coming To Your 401k (2018)  (Read 10306 times)
IroNat
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Life is a crapshoot.


« Reply #150 on: August 22, 2018, 04:16:58 PM »

The balloon has to pop at some point.

No one knows when but we're getting closer.

Keep some dry powder available.

My advice is consider how you would feel if your stock portfolio dropped 50%.

If you are close to retirement would you still be ok financially or would you be in trouble?

If your answer is "in trouble" you have too much in stocks and better dial it back.

A 50% drop is well within the realm of possibility.
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Irongrip400
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« Reply #151 on: August 22, 2018, 04:45:24 PM »

The balloon has to pop at some point.

No one knows when but we're getting closer.

Keep some dry powder available.

My advice is consider how you would feel if your stock portfolio dropped 50%.

If you are close to retirement would you still be ok financially or would you be in trouble?

If your answer is "in trouble" you have too much in stocks and better dial it back.

A 50% drop is well within the realm of possibility.

Correct.  I believe we are in the 7th inning of an extra innings game though.  I say 2020 before it crashes and by then I should be ahead of the curve.  I am not near retirement anyway so I will just keep on working.  Toll Brothers and the other big home builders say they don't see an end in sight yet.  Construction is still cranking, and if it slows up, all Trump needs to do is dump a bunch of money in infrastructure projects (which he hasn't done yet) and fire it back up.
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chaos
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« Reply #152 on: August 22, 2018, 08:37:34 PM »

The balloon has to pop at some point.

Oh yeah.
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« Reply #153 on: August 22, 2018, 08:41:43 PM »

people have made millions and lost millions trying to predict when a bubble will bust. Yes, it will, when is the question. I remember not too long ago when stocks fell to 15K. My coworkers or some of them panicked. This is it... get out get out. I did what some smart investors have always said. "When everyone one runs, get in" and here were are pushing 26K. I don't know what will happen tomorrow but I do know that the DOW is a pretty good bet at the moment.   
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Primemuscle
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« Reply #154 on: August 22, 2018, 11:26:53 PM »

The balloon has to pop at some point.

No one knows when but we're getting closer.

Keep some dry powder available.

My advice is consider how you would feel if your stock portfolio dropped 50%.

If you are close to retirement would you still be ok financially or would you be in trouble?

If your answer is "in trouble" you have too much in stocks and better dial it back.

A 50% drop is well within the realm of possibility.

If you are right, I'm glad that the bulk of my income is from guaranteed annuities.
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IroNat
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« Reply #155 on: August 23, 2018, 02:34:35 AM »

If you are right, I'm glad that the bulk of my income is from guaranteed annuities.

I don't think anybody will argue that the market will take a big hit sometime.

No one knows when.

It's like riding a hot streak in craps.  Sooner or later the dice roll against you.

If you keep all your money riding eventually you lose it.
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Thin Lizzy
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« Reply #156 on: August 23, 2018, 03:24:11 AM »

I don't think anybody will argue that the market will take a big hit sometime.

No one knows when.

It's like riding a hot streak in craps.  Sooner or later the dice roll against you.

If you keep all your money riding eventually you lose it.

The market will always take a big hit at some point, but you canít think that way. Otherwise youíll never be in the market.

You just need to have an escape plan for when it does happen. Markets donít crash in a day. When things start looking bad, you get out. Of course, you might be wrong and the market turns around and doesnít crash but thatís the game. If you canít  handle this reality, donít play.
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loco
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« Reply #157 on: August 23, 2018, 04:59:25 AM »

The market will always take a big hit at some point, but you canít think that way. Otherwise youíll never be in the market.

You just need to have an escape plan for when it does happen. Markets donít crash in a day. When things start looking bad, you get out. Of course, you might be wrong and the market turns around and doesnít crash but thatís the game. If you canít  handle this reality, donít play.

I respectfully disagree. Market timing never works.  Nobody can accurately predict the market, and those who claim to be able to and get it right (luck) also get it wrong just as many times if not more.

Instead invest in low cost, broad market index funds, with the bulk of it in an S&P 500 Index fund or a whole US market index fund.  Keep putting money into the fund bi-weekly or monthly, no matter what the market does.  If you do this long term, 10 to 30 years, you can't lose...unless you really need all of that money right as the market is losing 20% to 80%.  
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Thin Lizzy
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« Reply #158 on: August 23, 2018, 05:07:23 AM »

I respectfully disagree. Market timing never works.  Nobody can accurately predict the market, and those who claim to be able to and get it right (luck) also get it wrong just as many times if not more.

Instead invest in low cost, broad market index funds, with the bulk of it in an S&P 500 Index fund or a whole US market index fund.  Keep putting money into the fund bi-weekly or monthly, no matter what the market does.  If you do this long term, 10 to 30 years, you can't lose...unless you really need all of that money right as the market is losing 20% to 80%.  

Itís not about timing the market. Itís about crash insurance. The get out point is arbitrary. It has nothing to do with any sort of forecasting.

The market went down 90% in the 1920s. Thereís been 2 50% drops in the last 20 years. Thereís no guarantee that it wonít happen again. I know people who had to delay their retirement because of those crashes.

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loco
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« Reply #159 on: August 23, 2018, 06:07:18 AM »

Itís not about timing the market. Itís about crash insurance. The get out point is arbitrary. It has nothing to do with any sort of forecasting.

The market went down 90% in the 1920s. Thereís been 2 50% drops in the last 20 years. Thereís no guarantee that it wonít happen again. I know people who had to delay their retirement because of those crashes.



I'm one of those who believe NEVER get out, and stay the course.  Many "common folk" saw their market investments drop drastically in the most recent recession.  But those who stayed the course, continued to buy stocks via broad, low cost index funds no matter what, became millionaires just a few years later when the market recovered, and are still today adding to their wealth.

Yes, some of those had to delay retirement, but it paid off many times over for them.

Those who got out, then got back in later missed out on an opportunity that comes only once in a life time for many.
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Thin Lizzy
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« Reply #160 on: August 23, 2018, 06:38:59 AM »

I'm one of those who believe NEVER get out, and stay the course.  Many "common folk" saw their market investments drop drastically in the most recent recession.  But those who stayed the course, continued to buy stocks via broad, low cost index funds no matter what, became millionaires just a few years later when the market recovered, and are still today adding to their wealth.

Yes, some of those had to delay retirement, but it paid off many times over for them.

Those who got out, then got back in later missed out on an opportunity that comes only once in a life time for many.

At the end of the day thereís no perfect strategy. They all have drawbacks. The drawback of the one I recommend is that you can get whipsawed. The problem with yours is that if the market crashes you crash with it.
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loco
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« Reply #161 on: August 23, 2018, 06:57:46 AM »

At the end of the day thereís no perfect strategy. They all have drawbacks. The drawback of the one I recommend is that you can get whipsawed. The problem with yours is that if the market crashes you crash with it.

Yeah, I suppose the strategy I speak of, in many people's opinion, is the best possible strategy for the average professional.  And of course, even if this is indeed the best possible strategy for the average professional, there are no guarantees.

Like you said, some unfortunate guy in his late 50s who is getting ready to retire with a million dollars in his account and some debilitating illness forcing him to retire could see his million drop to 500K or 250K overnight.  For that one person, in this one case, that would be tragic.  For this person it's probably too late to benefit from a market recovery.

One way for a market investor to prepare for this, again no guarantees, is to invest one third or more in bonds.  That's specially true for older investors.
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Primemuscle
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« Reply #162 on: August 23, 2018, 12:18:59 PM »

I don't think anybody will argue that the market will take a big hit sometime.

No one knows when.

It's like riding a hot streak in craps.  Sooner or later the dice roll against you.

If you keep all your money riding eventually you lose it.

Craps was my step-dad's game. After months of him rolling the dice at home, we'd head to Vegas. A few hours later, he was crapped and tapped out of a couple thousand dollars and ready to head home.   Cry
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loco
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« Reply #163 on: August 28, 2018, 01:20:37 AM »

The Dow just busted out of its longest stint in correction territory in nearly 60 years

The Dow Jones Industrial Average on Monday catapulted out correction territory for the first time in more than six months, ending its longest period in that phase since a 223-session run in 1961, according to Dow Jones Market Data.

Mondayís broad-market rally was underpinned by signs of progress toward resolving nettlesome trade disputes that have whipsawed markets. Specifically, President Donald Trump said the U.S. has reached an agreement with Mexico to enter into a new trade deal, calling it the U.S.-Mexico trade pact.
https://www.marketwatch.com/story/dow-on-verge-of-busting-out-of-its-longest-stint-in-correction-territory-in-nearly-60-years-2018-08-27?siteid=yhoof2&yptr=yahoo


S&P 500, Nasdaq jump to record highs as US and Mexico strike trade deal
https://www.cnbc.com/2018/08/27/us-stocks-to-open-higher-after-powell-signals-further-rate-hikes.html
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chaos
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« Reply #164 on: August 28, 2018, 06:07:52 PM »

Thanks Obama Roll Eyes
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IroNat
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« Reply #165 on: August 29, 2018, 03:10:03 AM »

I'm no genius but I try not to make the same mistakes twice.

John Bogle, founder of Vanguard, one of the most respected investment managers in history, recommends an asset allocation to equities of 100 minus your age.  Simple.  Some more aggressive use 110-age for stocks.
Bogle recommends broad market index funds for most investors.

For someone age 60...

Stocks 100-60 = 40%
Bonds/cash = 60%

In addition keep an emergency fund of cash available.

Don't be lulled into over-confidence and get caught with your pants down.

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loco
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« Reply #166 on: August 29, 2018, 03:48:00 AM »

I'm no genius but I try not to make the same mistakes twice.

John Bogle, founder of Vanguard, one of the most respected investment managers in history, recommends an asset allocation to equities of 100 minus your age.  Simple.  Some more aggressive use 110-age for stocks.
Bogle recommends broad market index funds for most investors.

For someone age 60...

Stocks 100-60 = 40%
Bonds/cash = 60%

In addition keep an emergency fund of cash available.

Don't be lulled into over-confidence and get caught with your pants down.

Solid advice.
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IroNat
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« Reply #167 on: August 29, 2018, 05:38:06 AM »

Solid advice.

For morons like us it is a good plan.

No offense intended.
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loco
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« Reply #168 on: August 29, 2018, 06:25:13 AM »

For morons like us it is a good plan.

No offense intended.

Actually, this is great advice for professionals (surgeons, IT, engineers, nurses, teachers, etc.) and business owners, who have neither the time nor the desire to bother with how/when/where to invest in the stock market and protect hard earned money from inflation, taxes, and high investing fees.   Just set it and forget it, have peace of mind and sleep better at night.
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IroNat
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« Reply #169 on: August 29, 2018, 07:51:57 AM »

Actually, this is great advice for professionals (surgeons, IT, engineers, nurses, teachers, etc.) and business owners, who have neither the time nor the desire to bother with how/when/where to invest in the stock market and protect hard earned money from inflation, taxes, and high investing fees.   Just set it and forget it, have peace of mind and sleep better at night.

Good points all.
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loco
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« Reply #170 on: October 01, 2018, 06:51:10 AM »

Down, down down.....more to come.

Enjoy!


-NT



Dow jumps more than 250 points after the US and Canada secure a deal to replace NAFTA

https://www.cnbc.com/2018/10/01/us-markets-us-and-canada-trade-deal-economic-data-eyed.html
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IroNat
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« Reply #171 on: October 01, 2018, 11:25:01 AM »

The smart play is to allocate your portfolio properly between "safe" assets (bonds/cash/cash equivalents) and equities (stocks).

Don't be all stocks.  Don't be all bonds/cash.

It's not complicated.

The experts want to convince you it's complicated.  That's the game.  They want control of your money.

See my post above about John Bogle and his recommendation about asset allocation.  Very simple.

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Dos Equis
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« Reply #172 on: October 01, 2018, 01:42:20 PM »



Dow jumps more than 250 points after the US and Canada secure a deal to replace NAFTA

https://www.cnbc.com/2018/10/01/us-markets-us-and-canada-trade-deal-economic-data-eyed.html

Hahaha!   Grin
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Neurotoxin
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« Reply #173 on: October 11, 2018, 11:08:06 AM »

Itís STILL 2018..... correct?

Enjoy the show.


-NT
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Dos Equis
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« Reply #174 on: October 11, 2018, 11:34:33 AM »

Itís STILL 2018..... correct?

Enjoy the show.


-NT

 Roll Eyes
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