Dow

[jcwit]

Market drops 529 points. Not really good news.

Biggest drop in over 4 years.

[AK Caster]

Depends on who you talk to:) We pulled out at 18,200 suspecting a serious correction when all that stuff in Greece hit the fan. Haven't made a lot of money in government securities and bonds but sure as heck didn't lose any! If the DOW drops another 1,500 I'll look at buying back into it on a limited basis.

I wouldn't be shocked if the DOW drops to 12,000 by the end of the year.

[trapper9260]

it been over due because for the way it was going up.The worst is to come the way it looks now.

[jcwit]

WOW! You folks must not have much of a retirement plan.

[monge]

I think People worried about TRUMP no reason for it to be so high Gov bumping it, the rich are fleecing the poor slobs that have there retirerment there.just a guess but were else can you put your money no interest at banks force common people to play the game and they are the ones that lose!

[bob208]

it figures I just had to put in a sell to raise enough money to buy a tractor.

[garym1a2]

It stinks to see 10K disappear overnight!

[AK Caster]

WOW! You folks must not have much of a retirement plan.

Quite the contrary. Three pensions and two social security checks in this house hold. All get a COLA increase if the government announces inflation.
And if a person wanted to retire based on their 401K growing..........well I think that is being terribly risky. We moved it all over to safe funds before this crash.

[dtknowles]

WOW! You folks must not have much of a retirement plan.

Are saying this because of so little response?

Tim

[phonejack]

We're overdue for a drop. Think longterm and don't worry.

[Lead Fred]

22 markets across the globe are dropping like flies
oil is down but fuel is high, the perfect storm is brewing

All my futures are in precious metals, lead, copper, and brass

[Charley]

Diversity. As for the market, as said, think long term. It will head back up.

[bullet maker 57]

Always has, and always will.

[JonB_in_Glencoe]

WOW! You folks must not have much of a retirement plan.
Money isn't everything.

[dragon813gt]

Money isn't everything.

Correct, but it is required. I'm really concerned about retirement. I'm over 30 years away. I have little faith that social security will be there for me. And w/ a 401k every time I get ahead it's wiped out a few years later. Hard to get ahead w/ this type of cycle.

[jcwit]

Money isn't everything.

That's true, but you ever tried to live without any, that is without any for a year or more?

You ever try to retire without any?

[jcwit]

I watched a good friend of mine lose 3 million in the market, when he was done it was worth less than 3 hundred.

A falling market can be devastating to some folks, just the fact of the matter, one can say they invested wrong or put all their eggs in the wrong basket, but in the end it's all the same.

[David2011]

I could live at my current level for a year on what I've lost on paper in recent weeks. I know it will come back; just don't know when.

David

[JonB_in_Glencoe]

That's true, but you ever tried to live without any, that is without any for a year or more?

You ever try to retire without any?
I didn't say it was nothing, I said it isn't everything.

Most American's spend way too much.
Most American's borrow too much.
And then those American's worry too much.
money isn't everything.

If you don't spend too much and borrow too much, there is nothing to worry about ...no worries for me if the market corrects itself ...so 30% of it disappears, it'll come back before I need it. About 40% of my IRA disappeared in 2000, and about 20% disappeared in 2008, both times it came back and then grew. It'll come back again. No worries.

Retired ?
I kinda retired in 2003. I quit the full time job and started working as a independent contractor, part time at best. it is more like 12 to 20 weeks a year, at random, whenever the works shows up. I make enough to live, as well as save some $$$. Lots less stress than the full time rat race.

[merlin101]

I watched a good friend of mine lose 3 million in the market, when he was done it was worth less than 3 hundred.

A falling market can be devastating to some folks, just the fact of the matter, one can say they invested wrong or put all their eggs in the wrong basket, but in the end it's all the same.

"A fool and his money are soon parted" I can understand loseing money in the market, BUT 3mil. and only have a few hundred left? He really was a fool!

[jcwit]

Well I retired at the age of 58, way back in 2001. Love having worries as far as a job, not even 12 or 20 hours a week. Just my hobbies to take care of. Target shooting, and collecting guns, knives, watches, and such.

At present in the process of rebuilding an Anschutz 250 Match Target Air Rifle. Will bring it back to as new condition.

[alamogunr]

I started saving for retirement at 38, a little late according to conventional wisdom. I stuck with it and used the time up to retirement to educate myself about investing. The first bump in that road was the big drop in 1986. Many I knew panicked and got completely out of stocks. I weathered that and continued. There were other bumps such as the "dot com" bubble around 2000. A year or so after I retired, the real estate crises hit. I have managed to recover from all these by being diversified and staying the course. Yes, it hurts to see that bottom line of the IRA shrink and I have seen friends chase every hot sector and stock and then get pounded when a correction hit. Even if I kick the bucket tomorrow, I've made arrangements so my wife won't have to liquidate anything and can wait out the recovery.

When I worked, I never made a large salary. Saving something always came first. Wasn't much sometimes, especially when the sons were in college or needed help during grad school, but always something.

As they say, this too will pass.

[ol skool]

Those who do not heed the warnings of history are doomed to repeat them.

We had recession in oh 73 to 75 (is that right, oil embargo?), 80 to 82, 90 to 92, 01 to 02, 08 to present. One every 8 to,10 years. We're due for another....


Got out May, Dow 18,200?, price to earnings on S&P to rich. Market support are all phony, usual with Marxists leaders. Saw Obama say the economy was kickin' butt 'cause the stock market was record levels. Big sign it was time to move out. Traders freaking over Fed, and a bump off zero!! interest. Off zero and they freak!


40 years watching this teaches if you pay attention. Gold is at at it lows, stocks at highs, time to move. Watch the NASDAQ, buy the S&P. Forget sectors, int'l, individual stocks. Unless you KNOW the company.


A wise and wealthy Indian from Coleville taught me something: "you never lose money taking a profit, you will lose money being greedy".


I'll wait for a full slide, after a Fed move, buy when it looks like a solid up. Thinking somewhere around 14,000 will be the bottom, next year.

Writing on a tablet, sorry it's sounds short and snotty...

[TXGunNut]

It stinks to see 10K disappear overnight!


Actually it happened while I was at work and I really don't want to know as far as my personal account. I'm executor of an estate with a good bit in mutual funds, guess I'll hold off on that "sell" order. Have a fair bit of cash on hand, maybe I should invest some of it. I more than doubled the value of my dad's estate by dumping a bunch of cash into a few good funds in 2009 and pulling off a couple of good real estate deals.
I hope to dissolve this estate in a few months, I feel like another shoe is about to drop. I felt that way yesterday too, btw.

[big bore 99]

Money isn't everything.

Yeah...but what it 'ain't it can buy.

[Teddy (punchie)]

Money isn't everything.

Mouth full there !!

[Teddy (punchie)]

Those who do not heed the warnings of history are doomed to repeat them.

We had recession in oh 73 to 75 (is that right, oil embargo?), 80 to 82, 90 to 92, 01 to 02, 08 to present. One every 8 to,10 years. We're due for another....


Got out May, Dow 18,200?, price to earnings on S&P to rich. Market support are all phony, usual with Marxists leaders. Saw Obama say the economy was kickin' butt 'cause the stock market was record levels. Big sign it was time to move out. Traders freaking over Fed, and a bump off zero!! interest. Off zero and they freak!


40 years watching this teaches if you pay attention. Gold is at at it lows, stocks at highs, time to move. Watch the NASDAQ, buy the S&P. Forget sectors, int'l, individual stocks. Unless you KNOW the company.


A wise and wealthy Indian from Coleville taught me something: "you never lose money taking a profit, you will lose money being greedy".


I'll wait for a full slide, after a Fed move, buy when it looks like a solid up. Thinking somewhere around 14,000 will be the bottom, next year.

Writing on a tablet, sorry it's sounds short and snotty...

I like most if not all of what you said.

Yes around 14500 for Oct 2015 or shortly after then recover for a year then back down some.


If oil and gold and scrap, grains all stay too low we are looking for a lower then low market. If chart reset (or breaks) resistant low level it maybe 10,000 after election of 2016, like med 2017.

[monge]

Chinas economy not doing well they say, that means America not buying there junk! Were will Gov. borrow money to fuel stock market?

[BrassMagnet]

Always has, and always will.

Really?
Could this be a paradigm shift?
Could people have lost faith in the rigged game going on forever?
The Fed could raise rates a few times and shake some money out of bonds and back into the market. Maybe, but maybe the sheeple will be too afraid to play like they usually do.

[LuckyDog]

How does raising rates shake money out of bonds?
Serious question...

[cajun shooter]

My wife and I had a nice mom and pop drafting business drawing house plans that grossed over $160,000 our last year of 2006. We are common people and had some Insurance bonds and about 50,000 in savings that we were able to start up. Before the housing boom, we were making about half of that. we did not know that the market place was made artificially by the banks giving non qualified persons home loans. We knew nothing about that at all. Had we and the entire economy been given the true facts we would of been able to tuck more away.
Long story short, we believed the big bankers that things would get better so we did something that now tells us we were duped. We took our back up funds to keep our doors open as our business was the first to be hit. You don't build a home when you are broke. We kept putting our savings into our little business so that we would have it when things got better. Well after our funds were depleted and we had to declare bankruptcy, we are now living on a SS income of $1,155.00 a month. You want to see what we have been relegated to, stop by sometime.
The people that were the cause of the mess, all of them received bail out money. Our little two person business received a big ole ZERO!!!
I then fell on my back and caused a old military wound to become so bad that I was not able to walk or stand. "Just like Morton Salt, When It Rains It Pours"
I have in the past 7 years sold over 50 guns, reloading, casting equipment and everything else that someone else wanted. It's been hell and continues to be so.
I have several people who know me, ask me, How do you keep such an upbeat projection and I give that old saying, When Life gives you lemons, You Make Lemonade.
We will make it. Sometimes the things just keep knocking us down. Just this past week, our 15 year old Hot Water Heater gave up the ghost. The propane replacement was $585 at Home Depot and the plumber that came out did not want the job because we were a double wide. He gave us a price of $3300 for replacement. The second one said that he would help us out being that we were on SS and do it by the hour. Well at $110 a hour and 4 1/2 hours with an extra $55 in parts and you are at $554 .
That total is the exact amount of our entire months wages but what can we do?

[BrassMagnet]

How does raising rates shake money out of bonds?
Serious question...

I like this guy's advice (George Ure):

http://urbansurvival.com/coping-with-predictive-warfarebeat-on-george-day/

Read this. If rates go up, it affects Net Present Value (NPV) and sends low yield bond money to chase more inflation friendly investments. There is plenty more there, but that is the start. He also explains why a "bond market crash" is always a safe "doom & gloom" prediction because either the yield will go down or the NPV will go down.

[trapper9260]

22 markets across the globe are dropping like flies
oil is down but fuel is high, the perfect storm is brewing

All my futures are in precious metals, lead, copper, and brass

I am also in the same precious metals .That is the ones that will not be a lost no matter what this will all come to.

[Goatwhiskers]

Guess I'm showing my age, but I remember when the "experts" couldn't see the Dow ever hitting 1000. GW

[jcwit]

Guess I'm showing my age, but I remember when the "experts" couldn't see the Dow ever hitting 1000. GW

Oh ya, I to remember those days, bought my first stocks back in the 1950's. Had to get my dad's sig. in order to do so. Made a bundle on them too.

[ShooterAZ]

I lost 14K overnight...just like that. The sad thing about this for me is that my employer was matching my 401K contributions, until the downturn in 2008. I lost 50k+ on that downturn. I built it back up some, but with no matching funds. All of this is pretty scary stuff, but I still don't panic. If you dump it all into a money market, you lose out when it comes back again. This just goes to show that our economy is still pretty darn fragile...not nearly as strong as some would like to think.

[BrassMagnet]

I lost 14K overnight...just like that. The sad thing about this for me is that my employer was matching my 401K contributions, until the downturn in 2008. I lost 50k+ on that downturn. I built it back up some, but with no matching funds. All of this is pretty scary stuff, but I still don't panic. If you dump it all into a money market, you lose out when it comes back again. This just goes to show that our economy is still pretty darn fragile...not nearly as strong as some would like to think.

Yep. Our economy is the nicest horse in the glue factory.

[dtknowles]

Those who do not heed the warnings of history are doomed to repeat them.

We had recession in oh 73 to 75 (is that right, oil embargo?), 80 to 82, 90 to 92, 01 to 02, 08 to present. One every 8 to,10 years. We're due for another....


Got out May, Dow 18,200?, price to earnings on S&P to rich. Market support are all phony, usual with Marxists leaders. Saw Obama say the economy was kickin' butt 'cause the stock market was record levels. Big sign it was time to move out. Traders freaking over Fed, and a bump off zero!! interest. Off zero and they freak!


40 years watching this teaches if you pay attention. Gold is at at it lows, stocks at highs, time to move. Watch the NASDAQ, buy the S&P. Forget sectors, int'l, individual stocks. Unless you KNOW the company.


A wise and wealthy Indian from Coleville taught me something: "you never lose money taking a profit, you will lose money being greedy".


I'll wait for a full slide, after a Fed move, buy when it looks like a solid up. Thinking somewhere around 14,000 will be the bottom, next year.

Writing on a tablet, sorry it's sounds short and snotty...

I cleaned my whiteboard at work and put up a timeline of all the recessions since the end of WWII and plotted the Dow highs and lows against that. I did that about two weeks ago. I had been working it out in my head but I wanted to show it to me coworkers. I had called my broker and told him to get my equities positions down to less than 30 percent of my holdings but I did not tell him to dump the stocks but to sell off stuff on good market days. We did get some stocks sold off before the bad days last week. I told my coworkers that we would likely see another recession in less than 3 years. I don't think this is the recession but the market was over bought. I was able to get out of the market before the last two recessions. Monday is going to be interesting.

Tim

[AK Caster]

Our economy is extremely fragile and can tilt either way at the drop of a hat. Case in point, friend of mine is a loan officer and he specializes in home construction and farm loans. He told me 75% of the clients he meets with are 1 paycheck away from defaulting. These 75% have no savings, very little 401K, and hardly any have any source of retirement income other than social security. I think the Feds realizes this and it is why interest rates have been 0% for so long.

The stock market has steadily been pushed up over the last few years as a sort of Ponzi scheme. The big investment firms just keep on dumping money into it creating a false sense of value which causes more money to flow into it. When these firms sense the peak they dump everything causing most peoples 401 to tank as well as small investors being crushed.

[BrassMagnet]

I cleaned my whiteboard at work and put up a timeline of all the recessions since the end of WWII and plotted the Dow highs and lows against that. I did that about two weeks ago. I had been working it out in my head but I wanted to show it to me coworkers. I had called my broker and told him to get my equities positions down to less than 30 percent of my holdings but I did not tell him to dump the stocks but to sell off stuff on good market days. We did get some stocks sold off before the bad days last week. I told my coworkers that we would likely see another recession in less than 3 years. I don't think this is the recession but the market was over bought. I was able to get out of the market before the last two recessions. Monday is going to be interesting.

Tim

Friday finishing with the S&P 500 below the support line of 2040 was a bad thing. It could signal panic in the markets. Monday could tell, but where it finishes next Friday will surely tell!

Here is a link to some commentary on why:

http://urbansurvival.com/

I like George Ure. After today, this link will no longer go to the explanation of why 2040 was significant and I will have to re-direct the link.
His urbansurvival site is free and his peoplenomics site is a paid subscription. Yes, I am a subscriber.

[PB234]

When one reads something like this, "

"If you have a 2% yield bond and inflation expectations over the next 10 years jump to some astronomical level (10% per year, say) then your NPV of a 2% yield bond will collapse. But, if you have a 5% yield bond, your NPV (which would be above par value (e.g. over $1,000 now) would go even higher. "

You just have to laugh. Brass, maybe you should seek some other adviser?

[Prospector Howard]

Hopefully this isn't the start of a huge crash, but who knows? To me the stock market is something that reminds me of nothing more than a ponzi scheme and I've stayed away from it my whole life. I happened to see this on Frontline on PBS recently and for anyone that doesn't understand much about how their 401k works, it sure is educational and well worth the hour of time to watch it. It also reinforced my negative feelings towards banks and Wall Street. Nothing but a bunch of money skimmers, as far as I'm concerned.

https://www.youtube.com/watch?v=Iad1TMXkV-c

[monge]

Looks to me like they a re up to there old tricks giving loan to inflated properties with buyers that can just about make payment if all go well and they get there projected raise at work. NY, and California are to blame see it around me people buying 700k old houses that sold for 60k in the 1970s.One good earth quake in California and the state will go back to desert!

[Charley]

You fellers can always stuff your investment money in your mattresses. You'll get a much better return that way. Or, invest 100% of your money in gold. How can you lose?

[Blammer]

time to buy

[dtknowles]

time to buy

Yeah, I think you could make money on the short term volatility play but that is trading not investing. I am not a trader, I think more long term, I have a lot of cash right now but if I bought on this correction/dip, I would be selling on the next peak as the two to three year outlook is a recession.

Tim

[shdwlkr]

the stock market has always been a gamble, my grandfather lost over a million in 1929, never did see it again.
The market is bloated has been for a while now, should be in the 7-9000 range
401k accounts are a gamble no matter how you look at it, if inflation doesn't mess with them one day the feds just might
The only silver lining is yes the market goes down but it has to this point always come back up too.
I feel sorry for the little guys that get hosed when the market dips but you know there are those who wait for this event and buy like there is no tomorrow
Soros who put the hurt on the coal industry can't buy enough at $1.25 a share, think he feels he is going to lose his investment?
The best on can do is make sure that you have a lot of different stocks, in different industries and hope for the best

[monge]

Remember your money went some were somebody has it and is sitting pretty!

[ol skool]

...If oil and gold and scrap, grains all stay too low we are looking for a lower then low market. If chart reset (or breaks) resistant low level it maybe 10,000 after election of 2016, like med 2017.

I fear you may be spot on here. Although global markets, and the reality of weak US economy may drive Wall Street to thoses lows sooner than '17. Market dumps faster than it climbs

[ol skool]

I cleaned my whiteboard at work and put up a timeline of all the recessions since the end of WWII and plotted the Dow highs and lows against that. I did that about two weeks ago. I had been working it out in my head but I wanted to show it to me coworkers. I had called my broker and told him to get my equities positions down to less than 30 percent of my holdings but I did not tell him to dump the stocks but to sell off stuff on good market days. We did get some stocks sold off before the bad days last week. I told my coworkers that we would likely see another recession in less than 3 years. I don't think this is the recession but the market was over bought. I was able to get out of the market before the last two recessions. Monday is going to be interesting.

Tim

You're keeping your sell orders? Next week will be interesting.

[monge]

Gov and state employees are not worried they are guarantied there pensions they just raise taxes to make up for poor performance in the market. what about the rest of us?

[sparky45]

Not only was the market oversold, the Chinese have slapped us up side the head with their currency manipulation(s).

[quilbilly]

The market has been kept so artificially high for so long by the Fed that it is now completely segregated from the real world economy. Sooner or later it will have to go below 11,000. China's economy is equally artificial and has to slow down to match the economies of their biggest customers. Obama's artificial economy virus is finally attacking the Chinese economy.

[BrassMagnet]

The market has been kept so artificially high for so long by the Fed that it is now completely segregated from the real world economy. Sooner or later it will have to go below 11,000.

Do you see a reason for the drop to stop?

[AK Caster]

I have to laugh at you guys who say sit tight and it will go back up, not to worry, etc. Maybe it will, maybe it wont.

The ONLY rule to follow in investing is to buy low and sell high. This means anyone who cashed out when the DOW was over 18,000 will reap more rewards if they reinvest at some point and then (IF) the market goes back up in the short or long term they sell. You don't have to time the lows or highs perfectly, just be in the ball park.

Money sitting in the bank now earning less than 1% is a heck of a lot better than watching your portfolio drop by 10% so far this year.

[dtknowles]

You're keeping your sell orders? Next week will be interesting.

No, they were not orders anyway, it was a plan, a plan to sell stocks on market up days. I have a financial advisor who makes the trades and I give him a lot of discretion and just tell him what I would like to do. If or when the market bounces back he will sell more. If we see a real bear market then we will hold what we have and when the market recovers and starts back up we will use the cash in the account to buy more stocks while the market is down.

Tim

Tim

[WILCO]

http://imghumour.com/assets/Uploads/Lets-Bump.jpg

[Plate plinker]

Gov and state employees are not worried they are guarantied there pensions they just raise taxes to make up for poor performance in the market. what about the rest of us?
Fed employees no longer receive a government pension. They have 401K, old civil service contracts may be a different story. CS have a gravy contract.

[jcwit]

What Federal Employees actually get:

~http://everydaylife.globalpost.com/much-federal-employees-pension-benefits-36261.html

[AK Caster]

Fed employees no longer receive a government pension. They have 401K, old civil service contracts may be a different story. CS have a gravy contract.

Umm....that's entirely unaccurate about new employees

[jcwit]

Umm....that's entirely unaccurate about new employees

Right you are AK.

[BrassMagnet]

What Federal Employees actually get:

~http://everydaylife.globalpost.com/much-federal-employees-pension-benefits-36261.html


This information is not totally accurate:

Federal Employees Retirement System

In effect for all federal employees hired on or after January 1, 1987, the federal employees retirement system has three parts. Under this system, federal employees pay into Social Security and are eligible to receive benefits from it. They also get access to a federal pension that is calculated based on their length of service and their highest income while serving. The federal employees retirement system also includes access to the Thrift Savings Plan, which is like a 401(k) account. The government automatically pays one percent of pay into the plan for every covered employee and will also match worker contributions.

The bold part is not totally true. They match only a small portion.


Military Pensions

The military pension system is roughly similar to the federal system. Under it, a service member gets annual payments that are calculated based on her length of service and her military pay. As of 2013, service members usually become eligible for a military pension after 20 years of service. This means that someone could enlist at 18, retire from the military at 38, and earn a pension while working somewhere else. Service members also have access to the Thrift Savings Plan for additional tax-deferred savings.

This is true as far as it goes, but military retired pay now is much less than it used to be. When I retired, it was 50% of final base pay for 20 years and 75% for 30 years. Right after I retired, it changed to 50% of the average of the final three years pay. Now it is 37.5% at 20 (final 3 average!) and then increases each year until it reaches 75% at 30 years.

[jcwit]

This information is not totally accurate:

Federal Employees Retirement System

In effect for all federal employees hired on or after January 1, 1987, the federal employees retirement system has three parts. Under this system, federal employees pay into Social Security and are eligible to receive benefits from it. They also get access to a federal pension that is calculated based on their length of service and their highest income while serving. The federal employees retirement system also includes access to the Thrift Savings Plan, which is like a 401(k) account. The government automatically pays one percent of pay into the plan for every covered employee and will also match worker contributions.

The bold part is not totally true. They match only a small portion.


Military Pensions

The military pension system is roughly similar to the federal system. Under it, a service member gets annual payments that are calculated based on her length of service and her military pay. As of 2013, service members usually become eligible for a military pension after 20 years of service. This means that someone could enlist at 18, retire from the military at 38, and earn a pension while working somewhere else. Service members also have access to the Thrift Savings Plan for additional tax-deferred savings.

This is true as far as it goes, but military retired pay now is much less than it used to be. When I retired, it was 50% of final base pay for 20 years and 75% for 30 years. Right after I retired, it changed to 50% of the average of the final three years pay. Now it is 37.5% at 20 (final 3 average!) and then increases each year until it reaches 75% at 30 years.


But it does prove my point that it is not like a 401K.

[BrassMagnet]

http://castboolits.gunloads.com/images/misc/quote_icon.png Originally Posted by BrassMagnet http://castboolits.gunloads.com/images/buttons/viewpost-right.png (http://castboolits.gunloads.com/showthread.php?p=3352604#post3352604) This information is not totally accurate:

Federal Employees Retirement System

In effect for all federal employees hired on or after January 1, 1987, the federal employees retirement system has three parts. Under this system, federal employees pay into Social Security and are eligible to receive benefits from it. They also get access to a federal pension that is calculated based on their length of service and their highest income while serving. The federal employees retirement system also includes access to the Thrift Savings Plan, which is like a 401(k) account. The government automatically pays one percent of pay into the plan for every covered employee and will also match worker contributions.

The bold part is not totally true. They match only a small portion.


Military Pensions

The military pension system is roughly similar to the federal system. Under it, a service member gets annual payments that are calculated based on her length of service and her military pay. As of 2013, service members usually become eligible for a military pension after 20 years of service. This means that someone could enlist at 18, retire from the military at 38, and earn a pension while working somewhere else. Service members also have access to the Thrift Savings Plan for additional tax-deferred savings.

This is true as far as it goes, but military retired pay now is much less than it used to be. When I retired, it was 50% of final base pay for 20 years and 75% for 30 years. Right after I retired, it changed to 50% of the average of the final three years pay. Now it is 37.5% at 20 (final 3 average!) and then increases each year until it reaches 75% at 30 years.

But it does prove my point that it is not like a 401K.

[quilbilly]

Do you see a reason for the drop to stop?\
Mostly psychology, P&E, and some of the real value of some of the industries in the DOW once 11,000 is reached but the momentum of the drop may take a few days to slow so the Dow may blow through 11K a bit before the market stabilizes near a more realistic bottom

[BrassMagnet]

http://castboolits.gunloads.com/images/misc/quote_icon.png Originally Posted by BrassMagnet http://castboolits.gunloads.com/images/buttons/viewpost-right.png[/URL (http://castboolits.gunloads.com/showthread.php?p=3352604#post3352604)] This information is not totally accurate:

Federal Employees Retirement System
In effect for all federal employees hired on or after January 1, 1987, the federal employees retirement system has three parts. Under this system, federal employees pay into Social Security and are eligible to receive benefits from it. They also get access to a federal pension that is calculated based on their length of service and their highest income while serving. The federal employees retirement system also includes access to the Thrift Savings Plan, which is like a 401(k) account. The government automatically pays one percent of pay into the plan for every covered employee and will also match worker contributions.
The bold part is not totally true. They match only a small portion.

Military Pensions
The military pension system is roughly similar to the federal system. Under it, a service member gets annual payments that are calculated based on her length of service and her military pay. As of 2013, service members usually become eligible for a military pension after 20 years of service. This means that someone could enlist at 18, retire from the military at 38, and earn a pension while working somewhere else. Service members also have access to the Thrift Savings Plan for additional tax-deferred savings.
This is true as far as it goes, but military retired pay now is much less than it used to be. When I retired, it was 50% of final base pay for 20 years and 75% for 30 years. Right after I retired, it changed to 50% of the average of the final three years pay. Now it is 37.5% at 20 (final 3 average!) and then increases each year until it reaches 75% at 30 years.

But it does prove my point that it is not like a 401K.

Definitely!
It was written by someone that read the various plans without really understanding them. I say that because of the generalizations they include.
I fall under both, so this is also true: This means that someone could enlist at 18, retire from the military at 38, and earn a pension while working somewhere else.
Per this thread, I enlisted at 17 and I retired at 37:
[URL]http://castboolits.gunloads.com/showthread.php?246782-Photos-from-my-enlistment-on-Independence-Day-forty-years-ago-July-4-1974&highlight=
The military having a TSP account came after my time, but I do have a TSP account.

[Plate plinker]

But it does prove my point that it is not like a 401K.
Your wrong. Tsp is set up just like a employer 401k . With matching up to 6% of the employee salary. It's a pretty good deal.


Military I have no idea we are not military. I suspect that is like the old civil service contracts.

[TXGunNut]

All this pension discussion is interesting but not useful to me. I'm trustee of an estate with $75K in mutual funds and about twice that in cash, distribution in 60-90 days. I'm talking to my investment guy Monday but I have no idea what to do. I made a pile of money in 2009 but this is different.

[Teddy (punchie)]

Gov and state employees are not worried they are guarantied there pensions they just raise taxes to make up for poor performance in the market. what about the rest of us?

Not so we are all on a sick weak ship.

[Teddy (punchie)]

Its all sad and live and learn.

Your not alone. Wish you had better luck with the plumper. $110.00 and hour is high. More like $30.00-$50.00 for call out and 50-75 hour. Labor hear for hot water tank 250-300 last time I asked. Be glad it you got what you did and not the newer ones, plumper I talk to last year said as high as 1100.00 just for tank.


My wife and I had a nice mom and pop drafting business drawing house plans that grossed over $160,000 our last year of 2006. We are common people and had some Insurance bonds and about 50,000 in savings that we were able to start up. Before the housing boom, we were making about half of that. we did not know that the market place was made artificially by the banks giving non qualified persons home loans. We knew nothing about that at all. Had we and the entire economy been given the true facts we would of been able to tuck more away.
Long story short, we believed the big bankers that things would get better so we did something that now tells us we were duped. We took our back up funds to keep our doors open as our business was the first to be hit. You don't build a home when you are broke. We kept putting our savings into our little business so that we would have it when things got better. Well after our funds were depleted and we had to declare bankruptcy, we are now living on a SS income of $1,155.00 a month. You want to see what we have been relegated to, stop by sometime.
The people that were the cause of the mess, all of them received bail out money. Our little two person business received a big ole ZERO!!!
I then fell on my back and caused a old military wound to become so bad that I was not able to walk or stand. "Just like Morton Salt, When It Rains It Pours"
I have in the past 7 years sold over 50 guns, reloading, casting equipment and everything else that someone else wanted. It's been hell and continues to be so.
I have several people who know me, ask me, How do you keep such an upbeat projection and I give that old saying, When Life gives you lemons, You Make Lemonade.
We will make it. Sometimes the things just keep knocking us down. Just this past week, our 15 year old Hot Water Heater gave up the ghost. The propane replacement was $585 at Home Depot and the plumber that came out did not want the job because we were a double wide. He gave us a price of $3300 for replacement. The second one said that he would help us out being that we were on SS and do it by the hour. Well at $110 a hour and 4 1/2 hours with an extra $55 in parts and you are at $554 .
That total is the exact amount of our entire months wages but what can we do?

[AK Caster]

In todays paper there are a couple articles about how you should stay the course, not panic, don't sell, etc as things always bounce back. The article touched how the DOW has fallen over 10% so far this year.
Then on another section of the page an article about when is it time to sell a stock? This went on to reference the 10% rule that stated anytime a stock lost 10% of its value it should be immediately sold.

If this isn't the biggest load of manure I don't know what is.

[Plate plinker]

Contridictions???? That is why solid companies that have a sound track record are the way to go especially if you don't like the stress of potentially losing it all.

[bangerjim]

Same advice I would give anyone seeking medical or legal advice from a forum for lead melters & casters:

Find and talk to a PROFESSIONAL fiduciary-class investment advisor for stock/bond/pension information!!!!!!!! ( not a simple stock broker!) That is what I do. They know what they are doing and work for YOU, not the "company". I have made tons of money by doing that. And will continue to do so.

[alamogunr]

If this isn't the biggest load of manure I don't know what is.

If you want to see both manure and contradictions, check MarketWatch.com or some other financial web site. While I don't agree with everything posted in this thread, I almost lose my lunch over some of the things that show up on those web sites.

[Plate plinker]

Very astute bangerjim!

[dtknowles]

Same advice I would give anyone seeking medical or legal advice from a forum for lead melters & casters:

Find and talk to a PROFESSIONAL fiduciary-class investment advisor for stock/bond/pension information!!!!!!!! ( not a simple stock broker!) That is what I do. They know what they are doing and work for YOU, not the "company". I have made tons of money by doing that. And will continue to do so.

Good advice, hire a professional and let him do his job. Remember, most articles, on the web or in the paper are written by journalists, their profession is writing not investing or whatever.

Tim

[Charley]

My financial adviser is my number one son, works for American funds. Knows what he is doing, and doesn't BS (or charge me!). Also knows if my wife and I go bust we move in with him, so his advice is sound.

[alamogunr]

My financial adviser is my number one son, works for American funds. Knows what he is doing, and doesn't BS (or charge me!). Also knows if my wife and I go bust we move in with him, so his advice is sound.

Better incentive than fees or bonuses.

[Tackleberry41]

The drop really wasn't a surprise. The news here seldom talks about stuff overseas, parrot the official line of things are fine. Its out there if you look, every indicator shows bad times coming. But also depends on who you talk to, some forums, they would dismiss any talk of market rigging as tin foil hat stuff. That its all just capitalism and everything will keep going up forever. Funny to see 'preppers' planning for the end of the world, but scoff at the markets going bad.

Metals have crashed due to lack of demand, gold/silver are held down artificially. Seems the only people actually buying US debt is the US fed. China has been dumping theirs quietly, and the fed is buying them up quietly. China looked to introduce a new global currency next month, then everybody finally figured out the numbers they put on the news are pure garbage. That nobody, even the Chinese have any real idea how bad it is. The world is awash in debt, and most seem to say more debt will fix it, just like it did in Greece. I though for sure some sanity would prevail in Greece, but nope, kick the can a bit.

Pretty much every country now is running the printing presses night and day trying to push their problems off on other people, export their inflation and debt. The US is printing full tilt, yet our money is still rising, not so much rising as everybody else is sinking. So everybody pours their money into dollars as the safe..er bet. It was why China finally devalued the RMB, it was being dragged up by the dollar, making their imports expensive for everybody else. So now the rest of Asia will follow suit, racing to the bottom, to keep things going just a little longer.

China is about to come unglued, they will deny it, news here just pretends its not happening. Mao taught them to fudge the numbers. Getting worse at every step to the top. So by the time the 'numbers' get to Beijing they are no where close to reality. But they are good to report in the news, Mao only wanted good news, so that's what he got, didn't matter if people were starving to death. They actually exported when they couldn't even grow enough to feed themselves. If the boss in Beijing says there will be 7% growth, imagine that, its exactly what it is. Didn't matter if foreign made cars were piling up at the docks with no buyers. But then again GM was reporting cars produced but unsold as sold and therefore profits. Why do you think they offering the loans they are to move inventory? Anything to get a car off a lot, who cares if they actually paid for it.

I do have a little insight into China as my ex is from there. Spent quite a bit of time there. They are not consumers in the sense we are. Yea they love to buy things, but only bling to impress people, gold, diamonds, expensive clothes and cars. Most don't have appliances, or collect things like we do. My ex and other Chinese think keeping money in a bank is for suckers. They are always after the next get rich scheme. The stupid stuff friends of hers did to try and make money boggled the mind. It was more gambling than investing. Here most stocks are not owned by private citizens, maybe indirectly, thru IRAs or whatever. In China, something like half the money in markets are regular people. Farmers who put every penny in the market borrowing to invest more. All fine when markets were going up, but they lost everything when they went down. Couldn't even sell as they were under threat of the govt, if nobody can sell, markets don't go down, bet the fed wishes they could do that here.

Then couple weeks ago we had that 'glitch' that shut down markets most of the day. Pretty dang convenient considering Chinese markets had crashed over night, and ours were on the edge. Suddenly we had a glitch, cancelled the orders, got things fixed just in time for close. Then next day Chinese threw a pile of money at markets, banned selling, and things went back up. Well stuff like that can't go on forever. Now foreign investors all pulling their money out of China, they finally realized they couldn't trust the numbers the govt were giving out. Most here probably don't know that the Shanghai market drop of over 4% was only that way as better than half of stocks quit trading when they hit a 10% daily limit.

Will the markets have another magic day monday and they go up? Maybe another convenient glitch? Answer will be mon morn when you can check Asian markets and see what they did. If they continue to tank, they will drag us down with them. Everybody is now pouring their cash into the $ which only compounds our problems.

http://www.reuters.com/finance/markets/asia

[BrassMagnet]

The drop really wasn't a surprise. The news here seldom talks about stuff overseas, parrot the official line of things are fine. Its out there if you look, every indicator shows bad times coming. But also depends on who you talk to, some forums, they would dismiss any talk of market rigging as tin foil hat stuff. That its all just capitalism and everything will keep going up forever. Funny to see 'preppers' planning for the end of the world, but scoff at the markets going bad.

Metals have crashed due to lack of demand, gold/silver are held down artificially. Seems the only people actually buying US debt is the US fed. China has been dumping theirs quietly, and the fed is buying them up quietly. China looked to introduce a new global currency next month, then everybody finally figured out the numbers they put on the news are pure garbage. That nobody, even the Chinese have any real idea how bad it is. The world is awash in debt, and most seem to say more debt will fix it, just like it did in Greece. I though for sure some sanity would prevail in Greece, but nope, kick the can a bit.

Pretty much every country now is running the printing presses night and day trying to push their problems off on other people, export their inflation and debt. The US is printing full tilt, yet our money is still rising, not so much rising as everybody else is sinking. So everybody pours their money into dollars as the safe..er bet. It was why China finally devalued the RMB, it was being dragged up by the dollar, making their imports expensive for everybody else. So now the rest of Asia will follow suit, racing to the bottom, to keep things going just a little longer.

China is about to come unglued, they will deny it, news here just pretends its not happening. Mao taught them to fudge the numbers. Getting worse at every step to the top. So by the time the 'numbers' get to Beijing they are no where close to reality. But they are good to report in the news, Mao only wanted good news, so that's what he got, didn't matter if people were starving to death. They actually exported when they couldn't even grow enough to feed themselves. If the boss in Beijing says there will be 7% growth, imagine that, its exactly what it is. Didn't matter if foreign made cars were piling up at the docks with no buyers. But then again GM was reporting cars produced but unsold as sold and therefore profits. Why do you think they offering the loans they are to move inventory? Anything to get a car off a lot, who cares if they actually paid for it.

I do have a little insight into China as my ex is from there. Spent quite a bit of time there. They are not consumers in the sense we are. Yea they love to buy things, but only bling to impress people, gold, diamonds, expensive clothes and cars. Most don't have appliances, or collect things like we do. My ex and other Chinese think keeping money in a bank is for suckers. They are always after the next get rich scheme. The stupid stuff friends of hers did to try and make money boggled the mind. It was more gambling than investing. Here most stocks are not owned by private citizens, maybe indirectly, thru IRAs or whatever. In China, something like half the money in markets are regular people. Farmers who put every penny in the market borrowing to invest more. All fine when markets were going up, but they lost everything when they went down. Couldn't even sell as they were under threat of the govt, if nobody can sell, markets don't go down, bet the fed wishes they could do that here.

Then couple weeks ago we had that 'glitch' that shut down markets most of the day. Pretty dang convenient considering Chinese markets had crashed over night, and ours were on the edge. Suddenly we had a glitch, cancelled the orders, got things fixed just in time for close. Then next day Chinese threw a pile of money at markets, banned selling, and things went back up. Well stuff like that can't go on forever. Now foreign investors all pulling their money out of China, they finally realized they couldn't trust the numbers the govt were giving out. Most here probably don't know that the Shanghai market drop of over 4% was only that way as better than half of stocks quit trading when they hit a 10% daily limit.

Will the markets have another magic day monday and they go up? Maybe another convenient glitch? Answer will be mon morn when you can check Asian markets and see what they did. If they continue to tank, they will drag us down with them. Everybody is now pouring their cash into the $ which only compounds our problems.

http://www.reuters.com/finance/markets/asia


Pretty interesting commentary. It covers most bases.

[JonB_in_Glencoe]

shanghai market is DOWN 5% more (monday) as I type this, not sure how much more it'll go ?

BUT expect another big drop in NYSE tomorrow.

[Fishman]

All of this is very interesting, but investing doesn't need to be complicated. Invest a set amount every month in quality mutual funds and you will make money in the long haul. If your time frame is 10 years or longer, just keep plugging along. It is working fine for me, just as it has for millions of other people for the past century. Tales of guys going broke in the stock market are all about the ones that bought on margin or day traded or put all their money in that hot new start up. Be boring, and investing works.

[Blacksmith]

Don't forget the possibility of Tax Loss Harvesting to make the big drops more friendly. Google the term for many more links but here is one to get your education started:
http://www.investopedia.com/articles/taxes/08/tax-loss-harvesting.asp

It helps to turn an investment loss into a tax gain and it works, I have done it several times.

[Plate plinker]

Good call Jon. Looks like a rough one today.

[rondog]

"The time to buy is when there's blood in the streets."

[lightman]

This really concerns me, but its done it before. I've invested pretty heavy in our companies 401K and much of it is stock. Fortunately I have a decent retirement plan and the 401 is my hedge against when inflation eats away at my pension. I still like to see it go up more than going down. Dreading todays reports.

[Tackleberry41]

Expect things to get ugly today, every market is in the red, Shanghai dropped 8.5%as soon as the markets opened. They didn't go any further as about 80% of stocks hit their daily limit of 10% and stopped trading. So it would have been way worse. US futures are pointing to a 400 pt drop at the open.

Question is will someone trip over a power cord and the computers go down at the right moment to save everything for another day?

[Hickory]

The stock market has been fed for the last 6 years with your grandchildren & great grandchildren's money, (stimulus & QE3) so, now maybe this is the point in time that Margret Thatcher talked about when, "the government runs out of other people's money."

[bangerjim]

Amazing how panic (an foolishness) sets in at Wall & Broad!

Dow dropped 1100 immediately and now had gained back almost 500....all in 20 minutes!

[BrassMagnet]

Amazing how panic (an foolishness) sets in at Wall & Broad!

Dow dropped 1100 immediately and now had gained back almost 500....all in 20 minutes!

Some people will have lost heavily due to stop loss sell orders.
During the flash crash of a few years ago, some of Mrs. Brass' acquaintances has a stop loss order they had forgotten about. During the flash crash, it activated and sold their Apple stock. Their pain was enhanced by seeing the brag posted by the buyer on what a great deal they got just before the price sky-rocketed.
Those that think heavily before acting will likely do better in the long run. Those that rely on automated sell orders will likely be pummeled. High frequency traders will do well no matter what happens.

[AK Caster]

I am still hoping for a 12,000 level within a month or so then will comfortable buying back in. Although I might start trickling in some cash Wednesday or Thursday if we see another huge drop in the next day or so.

[Clay M]

A correction was overdue. It would have happened long ago if people had anywhere else to put their money.

[shooter93]

At times I'm not so sure that Al Capone wasn't right when he talked about the stock market....his advice.....stay out of the market fellows....it's a racket.

[Clay M]

At times I'm not so sure that Al Capone wasn't right when he talked about the stock market....his advice.....stay out of the market fellows....it's a racket.

Yes Sir..I learned that the hard way.;)

Enjoy..:smile:

[Four-Sixty]

I used to follow the market until I read "The Bogelheads' Guide to Investing". They cite quite a few studies that show our human nature is often the source of our bad decision making when it comes to investing. Now I just index and forget about it. There are much more interesting ways to spend my time then trying to understand the great amount of 'malrky' that the financial "press" feeds us.

Google around about how women (who are less prone to making trades) often fare better than men in the long term. Women more often practice dollar cost averaging in other words.

[MtGun44]

I love it when somebody says " the stock market is rigged" or "the
stock market is just like Las Vegas".

I invested wisely, with good, professional advice, for decades and now
have a comfortable retirement because of it.
Yes, buying an index and holding is very often better than buying
and selling on uneducated whims. However, there are a LOT of
different mutual funds out there (thousands, literally) and some have
been consistently in the top quarter of returns, well above the indexes,
for decades. Buying a well diversified range of top notch mutual
funds can be a really good plan.

Soon there will a great chance to be buying more, since things are "going on sale".

[alamogunr]

Amen! I really miss being able to dollar cost average when I was contributing to the 401k. That really built up my retirement funds.

[dtknowles]

A correction was overdue. It would have happened long ago if people had anywhere else to put their money.

Half my 401K is in bonds and they made a little money today. You have to spread it around and manage your distribution to match the climate. I have almost $500K in cash looking for a home but the market needs to go way lower if I am going to buy stocks.

Tim

[dtknowles]

At times I'm not so sure that Al Capone wasn't right when he talked about the stock market....his advice.....stay out of the market fellows....it's a racket.

It is a racket but it is a racket that everyone can play in but if you don't understand the unwritten rules you best stay on the sidelines.

When I was a kid, my NASA counterpart got me into options trading. I made what was for me at the time a lot of money but I could not stand the stress as with options your can lose everything in a heartbeat. They are highly leveraged but he had a system and it seemed to pay off most of the time. The odds were better than a casino but not really that much better.

Now I invest with a Professional Financial Advisor but even he needs some help sometimes. He would have had me stick to his plan and ride this out but I had him sell some stocks to generate cash as I believed that upside potential was not worth the downside risk. He fought me on that but gave it a half hearted attempt at selling before this correction. At least he did not advise me to have set stop loss orders. Even with a good financial advisor you can't just go on autopilot or I guess you can and still come out ahead but with a little more effort you can do even better.

Tim

[ol skool]

...I have almost $500K in cash looking for a home but the market needs to go way lower if I am going to buy stocks.Tim

This^^^

Today's close the S&P P/E was 19. Still irrational excuberance territory. Needs to run 1450 or so to meet up with the mean. Might not happen this quarter, but we will have another recession sometime and there will be buying oppurtunities then.

The idea of riding out the slide is sales pitch from the snake oil sellers. Get out when you start thinking things look goosey, get in when a bull has shown up and claimed it's ground.

I don't buy bonds, seems self defeating to me to willingly buy the debt of incompetent managers that I'm obliged to pay back with interest... But I'm odd that way. I only buy companies, but lately just funds and especially the S&P 500. Easier, lots of data.

Had money mangers nagging me a few years back. Told them to find me a fund or two that consistantly outperform the S&P and you'll get all my 401k. Never heard back from them.

[Teddy (punchie)]

The stock market has been fed for the last 6 years with your grandchildren & great grandchildren's money, (stimulus & QE3) so, now maybe this is the point in time that Margret Thatcher talked about when, "the government runs out of other people's money."

Sound about right !!

[Piedmont]

Today's close the S&P P/E was 19. Still irrational excuberance territory. Needs to run 1450 or so to meet up with the mean. Might not happen this quarter, but we will have another recession sometime and there will be buying oppurtunities then.
So you will buy when it hits the mean or will you wait until it hits the bottom? How will you know where the bottom is? Will you sit in cash waiting for this recession? How many years are you prepared to wait and what if it goes up in the interim? What if it goes up in the interim year after year and you miss the entire run up?

Long term, cash is a guaranteed loser, and stocks are as close to a guaranteed winner as we have. In addition to that, no one can time the market, though lots of people think they can.

[NavyVet1959]

The last 2 weeks have been a bit brutal. Today, between my and my wife's accounts, we're up $102K from where we were yesterday, but I'm still down $216K from where I was 2 weeks ago. Well, at least according to the brokerage firm's website. :(

As of 7/31 though, my accounts have had a 24.29% rate of return for YTD and my wife's have had a 23.23%.

"May you live in interesting times" :(

[dtknowles]

So you will buy when it hits the mean or will you wait until it hits the bottom? How will you know where the bottom is? Will you sit in cash waiting for this recession? How many years are you prepared to wait and what if it goes up in the interim? What if it goes up in the interim year after year and you miss the entire run up?

Long term, cash is a guaranteed loser, and stocks are as close to a guaranteed winner as we have. In addition to that, no one can time the market, though lots of people think they can.

I was heavily weighted in cash for 2 years before the Dot Com Bust, I was 50% or greater cash for more than a year before the great recession and I just two weeks ago told my financial adviser to start selling equities to build cash, at that time I felt that the next recession was not more than 3 years away and I was prepared to sit on cash that long for longer. I also told him I thought the upside potential for stocks was small (sort of topped out) and the risk was not worth the small potential gain (risk premium was too small).

Yes, cash is a loser but it loses very slowly and I can sleep better at night with cash when I can hear the Bear outside. About when I get back in, I don't get back in until I see the market make a serious recovery. I get out early and get back in late, I don't really try to time the market, I am just a chicken. I make the sure play not the most profitable one.

Tim

[Clay M]

I was heavily weighted in cash for 2 years before the Dot Com Bust, I was 50% or greater cash for more than a year before the great recession and I just two weeks ago told my financial adviser to start selling equities to build cash, at that time I felt that the next recession was not more than 3 years away and I was prepared to sit on cash that long for longer. I also told him I thought the upside potential for stocks was small (sort of topped out) and the risk was not worth the small potential gain (risk premium was too small).

Yes, cash is a loser but it loses very slowly and I can sleep better at night with cash when I can hear the Bear outside. About when I get back in, I don't get back in until I see the market make a serious recovery. I get out early and get back in late, I don't really try to time the market, I am just a chicken. I make the sure play not the most profitable one.

Tim

Sounds to me like you have a wise approach to it. There is no way to time the market, but you can often read when a correction is coming, and the market is over extended.

[dtknowles]

The last 2 weeks have been a bit brutal. Today, between my and my wife's accounts, we're up $102K from where we were yesterday, but I'm still down $216K from where I was 2 weeks ago. Well, at least according to the brokerage firm's website. :(

As of 7/31 though, my accounts have had a 24.29% rate of return for YTD and my wife's have had a 23.23%.

"My you live in interesting times" :(

Clearly you are not invested in SP500 index fund, the S&P is only up about 2 percent so to have recovered $100K on an S&P fund you would have needed a balance of $5M but then you said you were up in the mid 20% for year thru July and the S&P was only up 2% for that period. You make your own times even more interesting!

Myself, my funds were up less than 2% for the year and even with the drop, I am still positive for the year. Like I said I am a chicken, no high volatility investments or highly leveraged ones either for me. I was already heavily weighted to bonds (which have been up the past few days) and moving stocks to cash. I find the market moves interesting but they don't keep me up at night.

Tim

Tim

[NavyVet1959]

I watched a good friend of mine lose 3 million in the market, when he was done it was worth less than 3 hundred.

A falling market can be devastating to some folks, just the fact of the matter, one can say they invested wrong or put all their eggs in the wrong basket, but in the end it's all the same.

All it takes is investing heavily in Enron or GM... I had 1K of shares of each of them before they crashed, declared bankruptcy, and stole the money from the investors.

[NavyVet1959]

Clearly you are not invested in SP500 index fund, the S&P is only up about 2 percent so to have recovered $100K on an S&P fund you would have needed a balance of $5M but then you said you were up in the mid 20% for year thru July and the S&P was only up 2% for that period. You make your own times even more interesting!

Myself, my funds were up less than 2% for the year and even with the drop, I am still positive for the year. Like I said I am a chicken, no high volatility investments or highly leveraged ones either for me. I was already heavily weighted to bonds (which have been up the past few days) and moving stocks to cash. I find the market moves interesting but they don't keep me up at night.


Nope... Not in a SP500 index fund. More of a very small group of individual stocks. And my balance was a bit less than half of what you quoted -- at least *before* the current drop. I'm not a daytrader -- they look for small gains during a day and often do not keep stocks overnight. I set buy and sell points a few dollars apart. It's not as nerve wracking as daytrading, but I still find myself checking on the stocks a few times each day. Sometimes, I miss big jumps in a stock that happen when it keeps going up past my predefined sell point. That happened recently on me and the stock had eventually gone up $20 per share past what I sold it for. On the other hand, it's now back below what I sold it far and have bought it back. Over the last 10 years, I've beat the SP500, DJIA, and NASDAQ quite handily. I've been pretty lucky, I guess...

[dtknowles]

Nope... Not in a SP500 index fund. More of a very small group of individual stocks. And my balance was a bit less than half of what you quoted -- at least *before* the current drop. I'm not a daytrader -- they look for small gains during a day and often do not keep stocks overnight. I set buy and sell points a few dollars apart. It's not as nerve wracking as daytrading, but I still find myself checking on the stocks a few times each day. Sometimes, I miss big jumps in a stock that happen when it keeps going up past my predefined sell point. That happened recently on me and the stock had eventually gone up $20 per share past what I sold it for. On the other hand, it's now back below what I sold it far and have bought it back. Over the last 10 years, I've beat the SP500, DJIA, and NASDAQ quite handily. I've been pretty lucky, I guess...

You might have been lucky or maybe you just earned your earnings. It looks like you have a plan that requires some effort but it pays off.

Tim

[AK Caster]

Yee Haw!!! Down another 205:)
Might start looking for bargains by the end of the week is this continues.

[Clay M]

It may take a while to find a bottom. Buying now may be like catching a falling knife.

[perotter]

I was heavily weighted in cash for 2 years before the Dot Com Bust, I was 50% or greater cash for more than a year before the great recession and I just two weeks ago told my financial adviser to start selling equities to build cash, at that time I felt that the next recession was not more than 3 years away and I was prepared to sit on cash that long for longer. I also told him I thought the upside potential for stocks was small (sort of topped out) and the risk was not worth the small potential gain (risk premium was too small).

Yes, cash is a loser but it loses very slowly and I can sleep better at night with cash when I can hear the Bear outside. About when I get back in, I don't get back in until I see the market make a serious recovery. I get out early and get back in late, I don't really try to time the market, I am just a chicken. I make the sure play not the most profitable one.

Tim

I follow the old rule of 'Nobody has ever gone broke making a profit in the entire history of the world. But millions have gone bust being greedy'.

Last time I bought stock to any extent was in 2009. Sold about 1/2 of them when they doubled. That way the remainder had none none of my money in them. Sold the rest a couple of years ago. Recently sold some real estate, but ended up putting most of it into other real estate.

I also keep in mind what an old banker back home would tell everyone, 'Never trust anyone with your money. They'll stay up nights trying keep as much of it as possible.' That is hard to follow fully if one doesn't own a business or is at least self employed.

But the amount of money I've made or likely to make will never make me the idle rich.

[perotter]

It may take a while to find a bottom. Buying now may be like catching a falling knife.

It's been a long run up. Years in fact. Not likely it's bottomed yet.

[Clay M]

I use to day trade the tech stocks in the late 90's. I made enough in one day to go out and buy a new car. I have also had my A** handed to me on a silver tray.
I no long do anything that foolish, but I learned a lot in the process.
Land is my investment medium.
Gambling is an addiction just like drugs and alcohol.
I no longer gamble, the markets cured me of that permanently.

I could go to Vegas and never put a quarter in a machine..:smile:

I never will forget the morning my sister called me and told me she lost $80,000 in thirty minutes in Double Click..

Kind of like shooting a .458 win mag for the first time. It will make the hair stand up on your head.

Sure the Rush is great when you are winning, but it WILL not offset the feeling you get when you lose.

I am happy now..I don't need the Markets for happiness.

Will I every invest in the Markets again?..Probably not.

I don't need the market for success and happiness.

I have what I have,and I will most likely live comfortably until I die.

I can tell you a lot of things not to do..

The Market is fine if you are wise, BUT any bad news can affect what you invest in.
I would only use the index funds if I did it again.

AND I would call the shots, not some advisor..

I am a musician,and a shooter.I have nothing in my life that I have to worry about day to day.

I will most likely be dead in fifteen years, so I try to enjoy what is left without too many vices that I don't need.

Greed is not on the list..;)

[AK Caster]

I am sure we haven't hit bottom. Suspect we have another 3,000 - 4,000 points to drop. But it makes sense to rebuy slowly and cost average if the slide continues because the market will be back within 10 years.

[Clay M]

I am sure we haven't hit bottom. Suspect we have another 3,000 - 4,000 points to drop. But it makes sense to rebuy slowly and cost average if the slide continues because the market will be back within 10 years.

I think a realistic bottom would be about 12000,and it may, and probably will take a while to get there if this is a real Bear market.. We will see.

[dtknowles]

I am sure we haven't hit bottom. Suspect we have another 3,000 - 4,000 points to drop. But it makes sense to rebuy slowly and cost average if the slide continues because the market will be back within 10 years.

In 10 years we will be in the recession after the next recession. I erased it off my white board (so I don't have the data only my memory of the plots) but there have been about 9 recession since WWII the average duration between recessions for the last 5 recessions was 8 years, the longest was 11, it has been about 7 since the last recession. The boom bust cycle will continue.

Tim

Tim

[dtknowles]

I think a realistic bottom would be about 12000,and it may, and probably will take a while to get there if this is a real Bear market.. We will see.

Yes, this could just be a correction and not a Bear market. No way to tell, no need to try and catch a falling knife. Don't fall for a dead cat bounce either.

Tim

[Clay M]

Yes, this could just be a correction and not a Bear market. No way to tell, no need to try and catch a falling knife. Don't fall for a dead cat bounce either.

Tim
I have done it all my friend, and my advice is to lay low for a while.
I always wish I had shorted the tech stocks on the down side.
Hind sight is always 20/20..
;)

[BrassMagnet]

Hind sight is always 20/20..
;)

We have Americans that are so befuddled they can't see 20/20 even in hind sight. They do not see the present we see. They see a history that never happened because they have been told it happened and they believe what they are told. They are so brain washed they get enraged if you say anything that does not agree with what they believe.
It is sad to see it and I blame television for it.

[Clay M]

We have Americans that are so befuddled they can't see 20/20 even in hind sight. They do not see the present we see. They see a history that never happened because they have been told it happened and they believe what they are told. They are so brain washed they get enraged if you say anything that does not agree with what they believe.
It is sad to see it and I blame television for it.

I love you my friend. Hope you are doing well. I trust your health is good. Something that money can't buy.

I checked out great with my Cardiac Doctor. I still owe about $900 that the insurance won't pay.
Peace of mind is something you can't put a premium on.

Hind sight is 20/20 , but if I had knowledge from the past ,I would probably make a different set of mistakes, so.. I try to learn as I go and not beat myself up too badly for the mistakes of the past.

I live a simple life now.
http://www.msn.com/en-us/lifestyle/mind-and-soul/25-things-ive-learned-in-9-years-of-simplifying-my-life/ar-AAdda5O?li=AA2FWyw

A good one to follow.

I especially love what Henry David Thoreau said..

[lightman]

Well, Has this run it course? It closed up yesterday and its up right now. I was expecting it to last longer. I know, whatever we think is just a guess.

[NavyVet1959]

Well, Has this run it course? It closed up yesterday and its up right now. I was expecting it to last longer. I know, whatever we think is just a guess.

I'm still around $70K down from 2 weeks ago, but it's looking better...

[BrassMagnet]

Worry about another big drop around 9/11/15.

[snowwolfe]

I just cant stop thinking big money is manipulating the market. These huge swings just make no sense. Something is going on but can not put my finger on it.
I have done well, especially over the last two weeks but am selling now and moving more into precious metals.

[TXGunNut]

Well, Has this run it course? It closed up yesterday and its up right now. I was expecting it to last longer. I know, whatever we think is just a guess.


I think it was a correction that was overplayed by media who give credibility to whoever has the best doomsday theory. I made a nice profit jumping in with a wad of cash in late 2008/early 2009. I had a similar wad of cash a few weeks ago, paid of my mortgage and other debts. Thought about moving some more cash in this week but couldn't talk myself into it. I have some short-term investments that will likely move into cash after the next uptick.

I tried to get an appointment with my financial advisor this week. I need to discuss some longterm stuff with him but it can wait until next week, lol. I suspect he's pretty busy with nervous Nellies this week.

[lightman]

Yeah, I have some cash that I was thinking of putting into stock if this had continued. It would have been a gutsy move on my part but it looks like it may be over.

[Alexn20]

If you didn't see the PBS Frontline program "The Retirement Gamble" I suggest you watch it. 401K was never intended to be used as a retirement mechanism for the masses.

I think John Bogle stated it best: "You put up 100% of the capital, you take 100% of the risk, and get only 30% of the return." That is the reality of 401K.

That said, I do participate in 401K. The ONLY reason I do is my employer's 50% match. I cant pass up free $$. Best case scenario, the way I see it, is I lose 50% and hopefully retain the $ I put in. Worst case = lose it all. Its definitely a gamble.

I am not very concerned about the big fluctuations recently. I plan on keeping my 401K long term (35 more years) so I still have a long road ahead and I expect things will change many, many times in that time frame.

[dtknowles]

My 401K now rolled over into an IRA is worth more than twice my contributions.

Tim

[Alexn20]

My 401K now rolled over into an IRA is worth more than twice my contributions.

Tim

I can only hope I have the same luck. I'm not very optimistic about our financial future. To date I am doing well.

[NavyVet1959]

The problem with most 401k plans is that often need to be with the company for 5 years before you are considered vested. If you leave the company before then, all that matching money disappears. For some people, that might not be an issue, but in my profession, we tended to move between companies a lot because the companies would hire us as employees, but we really weren't much more than contractors. Eventually, I became a real contractor and it was a LOT better. I set up a Keogh and can put a pretty good percentage of my before tax income into it. Although I maxed that out each year, I wanted to put away even more, so I had regular brokerage accounts that are with after tax dollars that I regularly trade in.

[Tackleberry41]

If it was an actual market, then things would probably make alot more sense. I remember playing the market in economics class in school. It wasn't hard to figure out good stuff to buy.

Now its a casino, same luck as a slot machine, the deck is completely stacked against you. The HFT traders are way ahead of you on everything. You place an order, they buy it up a millisecond before you do, then sell to you at a slight profit. Some would say thats capitalism, only it would be like the guy in line ahead of you at wal mart, hears you say you want some 22, so he buys the last few boxes, even tho he doesn't want them, they offers to sell at a slightly higher price. Is he a capitalist or a jerk?

And all the corporations who have been borrowing money from the fed at 0% interest, and using the money to buy back their stock, boosting its price, along with the market, and the bonuses those at the top get. Of course now they have a loan to pay back, but is ignored.

GM who got bailed out not to long ago, cleared off alot of their debt in bankruptcy, all those who had stock got screwed. Then they issued new stock, starting the cycle again. GM was showing a profit, since they were claiming the profit of a car produced, even if it wasn't sold. They were pumping them out, piling up an inventory and claiming it was profit. Not the way I remember economics working. All the car companies had a glut of cars in China they couldn't sell, but still kept producing and shipping cars there.

Or the fact the fed is pulling the strings. The Chinese govt has sold off several 100 billion in T-bills in the last few months, sold 100 billion just the other day to have cash to prop up their money. Few actual people are buying t bills, most are bought on the sly by the US fed. Few weeks ago, the Chinese markets began to crash and ours followed suit, we conveniently had a 'computer glitch' that saved the day. We had another crash on Monday, many couldn't sell when the dip hit 1100 pts, the fed sprinkled some powdered unicorn horn on the markets, and yay their back up.

Or the gold markets, someone keeps smashing down the price every time it starts to move up. Or the fact that they print 1000 shares of paper gold for every actual once of gold there is. They need more gold to keep the price down, they just print more off. You cant buy actual physical gold for anywhere near the price listed on the exchange, thats the paper price. In Asia, you might pay an extra $1000 for an ounce of physical gold you can take home.

How is any of that a 'market'?

[dtknowles]

.....................Or the gold markets, someone keeps smashing down the price every time it starts to move up. Or the fact that they print 1000 shares of paper gold for every actual once of gold there is. They need more gold to keep the price down, they just print more off. You cant buy actual physical gold for anywhere near the price listed on the exchange, thats the paper price. In Asia, you might pay an extra $1000 for an ounce of physical gold you can take home.

How is any of that a 'market'?

Not sure what country in Asia you are talking about but here in the U.S. I think I can buy a lot of gold for a much smaller premium than that and get it delivered to my hand, physical gold. When I have purchased gold getting the physical gold did not seem to be a problem.

Tim

[dtknowles]

.......................Or the fact the fed is pulling the strings. The Chinese govt has sold off several 100 billion in T-bills in the last few months, sold 100 billion just the other day to have cash to prop up their money. Few actual people are buying t bills, most are bought on the sly by the US fed. Few weeks ago, the Chinese markets began to crash and ours followed suit, we conveniently had a 'computer glitch' that saved the day. We had another crash on Monday, many couldn't sell when the dip hit 1100 pts, the fed sprinkled some powdered unicorn horn on the markets, and yay their back up..............

How is any of that a 'market'?

The Chinese gov't found buyers for the T-bills and the prices held, seems like the market for U.S. bonds is fine, the Fed did not buy them, did they? Actual people do buy T-bills and Treasury Bonds but we mostly buy them as part of bond funds. It is inaccurate the say that most are bought by the U.S. Fed as they have much less than half of the outstanding U.S. debt, the Social Security Trust fund has a bunch too and none of this is done on the sly, it is clear in the public record, why do you say it is done on the sly?

The trading halts were circuit breakers not computer glitches, right? I did not notice an Fed action to prop up the market this week, did you see something?

Tim

[dtknowles]

............Now its a casino, same luck as a slot machine, the deck is completely stacked against you. The HFT traders are way ahead of you on everything. You place an order, they buy it up a millisecond before you do, then sell to you at a slight profit. Some would say thats capitalism, only it would be like the guy in line ahead of you at wal mart, hears you say you want some 22, so he buys the last few boxes, even tho he doesn't want them, they offers to sell at a slightly higher price. Is he a capitalist or a jerk? ..............................

I recommend you do not buy from jerks, at Walmart or Wall Street. You can set your price, you don't have to buy at market price, you can make a bid at the price you want and if someone likes your price a deal is made you don't have to by from the high frequency trader. If you are trading and not investing why would you think you can compete with the high frequency traders, in the market you are in competition and in competition the players with the best equipment and ability win most of the time.

Tim

[dakotashooter2]

They should have never started online trading...... Way to many amatures in the game now. Their actions and reactions to world events are unpredictable and throws the whole mess into chaos over just a hint of trouble.

[BrassMagnet]

I recommend you do not buy from jerks, at Walmart or Wall Street. You can set your price, you don't have to buy at market price, you can make a bid at the price you want and if someone likes your price a deal is made you don't have to by from the high frequency trader. If you are trading and not investing why would you think you can compete with the high frequency traders, in the market you are in competition and in competition the players with the best equipment and ability win most of the time.

Tim

I suspect you are unaware of what a high frequency trader actually is.

This is a description of HFT followed by the link where I found it:

What is high-frequency trading? By Investopedia Staff (http://www.investopedia.com/contributors/79/) AAA | http://i.investopedia.com/public/img/icon_print.png (http://www.investopedia.com/ask/answers/09/high-frequency-trading.asp#)






A: High frequency trading (http://www.investopedia.com/terms/h/high-frequency-trading.asp) is an automated trading platform used by large investment banks, hedge funds (http://www.investopedia.com/terms/h/hedgefund.asp) and institutional investors (http://www.investopedia.com/terms/i/institutionalinvestor.asp) which utilizes powerful computers to transact a large number of orders at extremely high speeds. These high frequency trading platforms allow traders to execute millions of orders and scan multiple markets and exchanges in a matter of seconds, thus giving the institutions that use the platforms a huge advantage in the open market.
The systems use complex algorithms to analyze the markets and are able to spot emerging trends in a fraction of a second. By being able to recognize shifts in the marketplace, the trading systems send hundreds of baskets of stocks out into the marketplace at bid-ask spreads (http://www.investopedia.com/terms/b/bid-askspread.asp) that are advantageous to the traders. By essentially anticipating and beating the trends to the market place, institutions that implement high frequency trading can gain favorable returns on trades they make by essence of their bid-ask spread, resulting in significant profits.
High frequency trading became common place in the markets following the introduction of incentives offered by exchanges for institutions to add liquidity (http://www.investopedia.com/terms/l/liquidity.asp) to the markets. By offering small incentives to these market makers, exchanges gain added liquidity, and the institutions which provide the liquidity also see increased profits on every trade they make, on top of their favorable spreads. Although the spreads and incentives amount to a fraction of 1 cent per transaction, multiplying that by a large number of trades per day amounts to sizable profits for high frequency traders.
Many see high frequency trading as unethical and an unfair advantage for large firms against smaller institutions and investors. (To try your hand at online trading, read Stimulate Your Skills With Simulated Trading (http://www.investopedia.com/articles/stocks/08/stock-simulator.asp)and check out the Investopedia Stock Simulator (http://simulator.investopedia.com/?partner=SAfooter) to trade stocks risk free!











Read more: What is high-frequency trading? (http://www.investopedia.com/ask/answers/09/high-frequency-trading.asp#ixzz3k9DZBQl7) http://www.investopedia.com/ask/answers/09/high-frequency-trading.asp#ixzz3k9DZBQl7
Follow us: Investopedia on Facebook (http://ec.tynt.com/b/rf?id=arwjQmCEqr4l6Cadbi-bnq&u=Investopedia)

[dtknowles]

I suspect you are unaware of what a high frequency trader actually is.

This is a description of HFT followed by the link where I found it:

.....

I know what it is and if you place a bid, "limit order", you can avoid being part of a HFT because you will not meet their criteria for tradable bid/ask spread. If you place a "market order" then you could be scammed by the HFT.

Read this article, a little of special interest is clipped below.

http://www.usatoday.com/story/money/markets/2015/08/28/downside-etfs-black-monday-china-halted-trades/71312286/
The solution? Investors should always rely on what is known as a "limit order" rather than a market order when buying an selling ETF.
"Market orders on ETF trading is definitely a Big No. We learned that from the Flash Crash," said Sebastian Mercado, ETF strategist with Deutsche Bank. "You use a limit order," Mercado said.

Tim

p.s. HFT is not just for big investment houses, hedge funds etc. there are teams of techs who do it for themselves or sell their services.

[BrassMagnet]

I know what it is and if you place a bid, "limit order", you can avoid being part of a HFT because you will not meet their criteria for tradable bid/ask spread. If you place a "market order" then you could be scammed by the HFT.

Read this article, a little of special interest is clipped below.

http://www.usatoday.com/story/money/markets/2015/08/28/downside-etfs-black-monday-china-halted-trades/71312286/
The solution? Investors should always rely on what is known as a "limit order" rather than a market order when buying an selling ETF.
"Market orders on ETF trading is definitely a Big No. We learned that from the Flash Crash," said Sebastian Mercado, ETF strategist with Deutsche Bank. "You use a limit order," Mercado said.

Tim

p.s. HFT is not just for big investment houses, hedge funds etc. there are teams of techs who do it for themselves or sell their services.


Thank you. Now I know why when I buy more gold mine stock for my Roth IRA I always end up paying the high price of the day.
Now for those inquiring minds. My gold mine stock (Freeport McMoran Gold & Silver aka FCX) bought into energy just before the energy crash and they are crashing, too! I am not motivated to "harvest the loss" so I will just see if their massive funding allows them to weather this storm.