I hear Allen Parsons in my head...."What goes up, must come down"...

quote:

Originally posted by duke762:
I hear Allen Parsons in my head...."What goes up, must come down"...

It always does!!!!

I prefer "buy low, sell high"

For all those who think the market is teetering on the edge of collapse, the PE ratio of the S&P 500, while at the upper end of its normal cycle, is far from the absurd range.

http://www.multpl.com

quote:

Originally posted by BBMW:
For all those who think the market is teetering on the edge of collapse, the PE ratio of the S&P 500, while at the upper end of its normal cycle, is far from the absurd range.

http://www.multpl.com

The lifelong average according to this chart is somewhere around 13-15. It's currently at 25x. UMMMM well.......

"Time in the market, not timing the market."

http://www.businessinsider.com...g-the-market-2014-11

https://www.ifa.com/12steps/st...best_and_worst_days/

https://www.kiplinger.com/arti...f-market-timing.html
"Still not convinced? If I asked you to name the top 10 artists of all time or the top 10 baseball players or the top 10 presidents, we’d all have our own list and happily debate our choices. Now, let me ask you, name the top 10 market timers of all time? Having trouble? How about the top 5? Still stuck? How about the top 1? I’m sure you’re still having trouble.

My point is, if anyone had successfully timed the market over an extended period of time we would know his or her name as they would be one of the richest people in the world. The fact that we don’t know any names should be a warning sign not to chase the illusion of market timing."

When it comes to trying to time the market, the following saying applies, "a fool and his money are soon parted."

quote:

Originally posted by DMF:
"Time in the market, not timing the market."

http://www.businessinsider.com...g-the-market-2014-11

https://www.ifa.com/12steps/st...best_and_worst_days/

https://www.kiplinger.com/arti...f-market-timing.html
"Still not convinced? If I asked you to name the top 10 artists of all time or the top 10 baseball players or the top 10 presidents, we’d all have our own list and happily debate our choices. Now, let me ask you, name the top 10 market timers of all time? Having trouble? How about the top 5? Still stuck? How about the top 1? I’m sure you’re still having trouble.

My point is, if anyone had successfully timed the market over an extended period of time we would know his or her name as they would be one of the richest people in the world. The fact that we don’t know any names should be a warning sign not to chase the illusion of market timing."

When it comes to trying to time the market, the following saying applies, "a fool and his money are soon parted."

Ummm Warren Buffett would be number 1.

It also depends on when you plan on exiting the market (such as retirement). If someone is planning on taking their money out of the market in a few years, I would do it now and put it somewhere safe. Also being WELL diversified is key.

I was making 5.5-6% on money market accounts prior to the recession so I saw no need to be in the stock market at the time......then towards the end of 2008 I got back into the stock market. I made 36% per year (average) from 2008-2013 day/week trading and in and out of the same 20 or so stocks, I bought both a 4 plex that provides a 20% ROI and a nice house cash with the money I made in the market, both properties have more than doubled in value since I bought them. So I'd say I timed both markets well enough.....

Everything goes in stages, I wouldn't put a dollar in the stock market right now (getting into it.) You can get in and get out of various markets and time them pretty well if you know what to look for. Some funds do also perform very well over time too.

Everything has an inverse effect, when interest rates start creeping up soon.....money will move more towards bonds and cd's and slowly out of the stock market.....and house prices will slow or even go down......

quote:

Originally posted by jimmy123x:

quote:

Originally posted by DMF:
"Time in the market, not timing the market."

http://www.businessinsider.com...g-the-market-2014-11

https://www.ifa.com/12steps/st...best_and_worst_days/

https://www.kiplinger.com/arti...f-market-timing.html
"Still not convinced? If I asked you to name the top 10 artists of all time or the top 10 baseball players or the top 10 presidents, we’d all have our own list and happily debate our choices. Now, let me ask you, name the top 10 market timers of all time? Having trouble? How about the top 5? Still stuck? How about the top 1? I’m sure you’re still having trouble.

My point is, if anyone had successfully timed the market over an extended period of time we would know his or her name as they would be one of the richest people in the world. The fact that we don’t know any names should be a warning sign not to chase the illusion of market timing."

When it comes to trying to time the market, the following saying applies, "a fool and his money are soon parted."

Ummm Warren Buffett would be number 1.

You might want to look at this analysis of market timing, and specifically Buffett's investing strategy:
https://www.bloomberg.com/gadf...by-timing-the-market

". . . using Berkshire’s historical cash allocations, I devised a simple model to see whether Buffett’s market timing likely helped or hurt his performance. . .

. . . It turns out that Buffett’s market timing has likely paid off, but only modestly. Buffett’s allocations returned 9.6 percent annually during the period, including dividends, whereas the static allocation returned 9.5 percent annually.

Investors who can stick to a measured market-timing strategy may be rewarded. But the next time you hear a billionaire investor calling the next correction, remember that they most likely didn’t get rich by timing the market."

Just like gamblers who love a craps table, or blackjack table, and have anecdotes about how they've won, there are market timers who have anecdotes about how they made money on some timing move. The reality is market timing dramatically increases risk, rarely has any reward, and just like the gamblers, over the long haul the losses outstrip the gains.

I don't know if lifelong average counts for very much. It held significantly above this level for five or more years from the late '90s the early 0's before the .com bubble popped. How long are you willing to have your money make nothing waiting for the market to roll back. And even then, there's no way you can know how far it will roll back.

quote:

Originally posted by jimmy123x:

quote:

Originally posted by BBMW:
For all those who think the market is teetering on the edge of collapse, the PE ratio of the S&P 500, while at the upper end of its normal cycle, is far from the absurd range.

http://www.multpl.com

The lifelong average according to this chart is somewhere around 13-15. It's currently at 25x. UMMMM well.......

quote:

Originally posted by jimmy123x:

quote:

Originally posted by DMF:
Now, let me ask you, name the top 10 market timers of all time? Having trouble? How about the top 5? Still stuck? How about the top 1?

Ummm Warren Buffett would be number 1.

Nosireebob.

Buy low on value, hold forever - which is what Mr B. does, with very few exceptions - is the absolute antithesis of 'market timing'.

Personally, I don't focus on what the Dow hits or the S&P 500 hits. I do care about corporate earnings, interest rates, GNP growth, tax/fiscal policies. I don't see much on the horizon flashing even yellow lights on any of those parameters.

The continuing string of records is really the stock market catching up after 8 years of dreck policies. Profits are up, growth prospects are good, the Fed isn't on a jihad to spike interest rates upward, ridiculous regulations are on the wane rather than being dredged up in bucketloads, and consumers are starting to realize that the dark years of Obama are over. The Dow bumping into records on the way up is just recognizing this. It's an effect, not a cause.

The only thing on the horizon that isn't good and won't/can't go away is demographic - the aging of the US investor base due to the usual trend to shift portfolios away from equities as one gets older. That'll result in a gradual reduction in demand for equities (they won't be buying) and an increase in supply as they sell. A gradual, rather than catastrophic thing, IMO.

Yeah, black swans are out there. Flash crashes, cretinous dictators, jihadists, etc. But to stay out is to earn the nothing that is interest these days. Less risk, yes, but microscopic earnings and not much upside.

quote:

Originally posted by BBMW:
I don't know if lifelong average counts for very much. It held significantly above this level for five or more years from the late '90s the early 0's before the .com bubble popped. How long are you willing to have your money make nothing waiting for the market to roll back. And even then, there's no way you can know how far it will roll back.

quote:

Originally posted by jimmy123x:

quote:

Originally posted by BBMW:
For all those who think the market is teetering on the edge of collapse, the PE ratio of the S&P 500, while at the upper end of its normal cycle, is far from the absurd range.

http://www.multpl.com

The lifelong average according to this chart is somewhere around 13-15. It's currently at 25x. UMMMM well.......

It totally depends on what your goals are and what your age is and what each persons individual situation is. I wouldn't get into the stock market right now. I'm from the philosophy that you buy low and then hold (or get out), but you don't get in when something is highly priced. My individual situation is different than most people's on here, I'm a small business owner. I don't work for a corporation, so nobody would match if I contributed to a 401k or any of that.

I look at not tieing my money up super long term like a 401k in case I could not work (I'm 41 but my work is physical based) or I want to go in a different direction. I made a lot of money in the market and basically took all of my money out of the market and bought an income property with it (cash). The income property produces enough net income that I could live off of it (considering I also paid cash for my house with what I made in the market as well 4 years after buying/living in one unit in the 4 plex) and my living expenses are extremely low. That being said after fixing up both properties (they were both a short sale or foreclosure and needy). Both properties have doubled in value since I've bought them. I've been stocking cash and making very small rare trades in the market.....but at the time my cash is about 10% of my net worth, the rest being tied up with properties. While it is a significant amount of cash to most people, I'm currently in a conundrum of whether I want to get out of the income properties completely, sell my house and buy a waterfront house with a lot of dockage I could rent out to my customers, or keep things the same. I also am waiting for another shoe to drop before investing in the market or more real estate. I was very lucky in several aspects, all of my money was in FDIC insured money market accounts when the recession hit, and I only lost 6 figures in value on a condo I own that I bought in 2005 and was living in at the time, and that I was able to increase my net worth 7x in a 7 year period......but it hasn't increased much in the last year or two.....so I've been pondering exactly what you wrote.

But the moral of the story is everyone's investment needs are totally different depending on your situation and goals.

There was a thread I remember not too long ago where someone was asking for advice on rolling an existing 401k from a previous employer to another vehicle. I can't find it, does someone know what that was?

The 700 gazillion QE has to play a role in this. If a dollar is worth less than half what is was, then the American economy as a value of x should be worth x times two or more.

quote:

Originally posted by r0gue:
The 700 gazillion QE has to play a role in this. If a dollar is worth less than half what is was, then the American economy as a value of x should be worth x times two or more.

True, but how does that apply to the DOW? All numbers valued in dollars will be equally inflated and ratios would remain unchanged. In the current case, price is up but earnings aren't up by the same percentage, so it's not just inflation.

The Investor Business Daily top 50 are up 42 percent.



Looking at the SP500 weekly five year chart, it is interesting to see what the volume did since President Trump was elected. The volume went from an average of 3 to 10 Tillion per week or more than 3 times the volume traded before he was elected.

It would be healthy for the market to pull back to the 2400 level. So far the NY new highs/new lows have not pulled back. We had a pull back in the week of Aug 7 but then it turned back up on Aug 21.

I think next year, President Trump will start downsizing the Government to reduce the deficit.



All aboard! The choo choo train just left the station!

This message has been edited. Last edited by: 41,