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What's the next stock market bubble?

Just saw an interesting article on some experts abandoning the 60/40 recommendation that has been used for decades.

Mike Wilson, the CIO of Morgan Stanley now advocates 60/20/20 stocks/bonds/precious metals.

Jeff Gundlach, "the Bond King", is advocating 25/25/25/25 stocks/bonds/precious metals/cash.
 
Just saw an interesting article on some experts abandoning the 60/40 recommendation that has been used for decades.

Mike Wilson, the CIO of Morgan Stanley now advocates 60/20/20 stocks/bonds/precious metals.

Jeff Gundlach, "the Bond King", is advocating 25/25/25/25 stocks/bonds/precious metals/cash.
That's a bad sign - when long term bears turn bull.
 
AI, just like the tech bubble, the solar bubble, only a few will survive
 
That's a bad sign - when long term bears turn bull.

Most of the gold buying is from central banks, which are moving away from debt-encumbered fiat currencies. They don't have a lot of other places to go, so the market in gold should stay strong. Gold is a currency with no counterparty risks. Now we are seeing some investors come in, but they are small players compared to the central banks.

Silver is a different ball game, and industrial demand is a big factor there. Market demand has exceeded mine supply for several years and that exess of demand over suppoy is expected to increase. While silver is a precious metal with an FX cross to all other currencies in the foreign exchange market, it is also fundamentally an industrial commodity as well.
 
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Most of the gold buying is from central banks, which are moving away from debt-encumbered fiat currencies. They don't have a lot of other places to go, so the market in gold should stay strong. Gold is a currency with no counterparty risks. Now we are seeing some investors come in, but they are small players compared to the central banks.

Silver is a different ball game, and industrial demand is a big factor there. Market demand has exceeded mine supply for several years and is expected to increase. While silver is a precious metal with an FX cross to all other currencies in the foreign exchange market, it is also fundamentally an industrial commodity as well.


But if one doesn't have guns, cameras, and 24/7 security protection for the "metals" hoard in a safe ... whatcha gonna do ..... ???

Other people will protect your gold hoard .... (for a fee)

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gold_SPY.jpg

https://portfolioslab.com/tools/stock-comparison/GLD/SPY

gold.jpg




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strss.jpg


"The 60/40 portfolio softened the blow of nearly every market crash"
 
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Year to Date

GOLD UP 43.79%

DOW UP 9.09%

BIG difference !

If you want to know why central banks are dumping dollars to buy gold, you might want to look at this:
And it is just as bad for all major fiat currencies. The currencies with NO debt? gold and silver
 
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Year to Date

GOLD UP 43.79%

DOW UP 9.09%

BIG difference !

If you want to know why central banks are dumping dollars to buy gold, you might want to look at this:
And it is just as bad for all major fiat currencies. The currencies with NO debt? gold and silver
Absolutely and the China Domino will be felt the world over, the housing crisis still has not come to full realization yet. This Crypto business being shoved around the world will collapse and leave entire nations holding the bag, El Salvador better hope they aren't left holding that paperweight.
 
Stocks are still the move for now as long as you are nimble and aren't Buffeting everything, this is not that time.
 
Absolutely and the China Domino will be felt the world over, the housing crisis still has not come to full realization yet. This Crypto business being shoved around the world will collapse and leave entire nations holding the bag, El Salvador better hope they aren't left holding that paperweight.


OK, so you predict that crypto, bitcoin, meme coins, etc. will collapse and along with the collapse of the housing market and the "China Domino" will cause a recession or "burst the bubble" in the near future.

You should place your bets and make a fortune !


prediction.jpg



https://kalshi.com
 
Dow Jones UP 12.97%
not that it really matters, but every time you use the DJIA you lose credibility in saying a single word about stocks.
The first step in stock investing is to understand what "EQUITY" is.
The 2nd step in stock investing is to understand how it compounds in a great business.
the 3rd step in stock investing is to understand how to CHOOSE SECTORS, aka "Fish where the fish are"
 
Dow Jones UP 59.96%
DJIA = :ROFLMAO:
Fidelity Tech fund up 120% (+/-)
Seligman Tech fund up 190% (+/-)
Those are just 2 tech funds that came to mind. I can look up 8 more and they're all likely to be in that 120 - 190% range.
And those are Mutual Funds, which have their ankles tied by a bunch of rules set by "Marketing". Any decent, rational, non-ADD Tech Investor should have done at least close to that +190% over the last 5 yrs
 
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If Sarah prevents Skynet from becoming self-aware then probably more than a few will survive



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View attachment 116431

View attachment 116432
I'm a relatively old geezer. I remember as a little kid getting silver dimes and quarters in change. Not occasionally but totally silver coins. (The copper-nickel coins did not come into existence until 1965.) So let see . . . late 1963 - say I had $1000 to invest. Which would have done better - taking my $1000 to the bank and getting a pile of silver coins, or buying that cumulative 100% equity bundle? (Never mind the fact that in 1963, that was impossible to do with a small amount; no ETFs no no-load mutual funds.)

A new dime, quarter, or half dollar had .723 ounces of silver per dollar then. Allowing for wear, I would use .715 oz per dollar. That works out to a $1.40 per oz. Current price of $47 oz divided by $1.40 = 33.5 times the original investment.

I look at your chart. It says cumulative. Does that mean with dividends reinvested? I will assume yes, pending more information.
The price of that basket of stocks, based upon my attempt to read the chart at late 1963, would be $900. $33033 divided by $900 = 36.70 times.

Now 36.70 is greater than 33.5, but as John Wayne said in Rio Bravo, "I'd hate to have to live on the difference".

I point all this out to remind you that the dollar has been shrinking in purchasing power for many decades. Much of that stock return is illusion, it's just effect of inflation. If you don't like metals, look at the price of hamburgers over the same period, or other stable technology products. (No matter how cheap and fast computers get, a hamburger is still going to be a hamburger.)
 
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boring.jpg


September 29, 2025

https://www.wsj.com/finance/investing/index-funds-investing-stock-market-f747f46f?gaa_at=eafs&gaa_n=ASWzDAh4vYTxuseSXvsmgJyDcTQuFe3-Fat3NfyxDtMZF2QiN0EwW21xJ9wI&gaa_ts=68daf800&gaa_sig=8b7PpLqF0r0vhXMm9SzNw5gj6dPTIlYKJQ0K8_tQLWFmSM0e5NTb_iS-DyTxgcmVlJ2kWO9riDPRPYAi1jdojw==

"Index funds were first considered nonsense. That nonsense now rules among many individual investors.

Index funds are probably the most enduring and transformative innovation for individual investors since mutual funds became available to them in 1928

"Index funds also revealed one of Wall Street’s secrets—that high cost mutual funds run by highly paid managers hardly ever outperform the market in the long run. Index funds, on the other hand, let anyone match the market’s return, minus tiny fees that these days are measured in hundredths of a
percent of an investor’s holding



In this world, low-cost, boring index funds start out with a huge advantage over shinier but higher-cost actively managed funds. That’s why index funds are likely to keep taking market share from active funds as far as the eye can see.
 
View attachment 116482

September 29, 2025

https://www.wsj.com/finance/investing/index-funds-investing-stock-market-f747f46f?gaa_at=eafs&gaa_n=ASWzDAh4vYTxuseSXvsmgJyDcTQuFe3-Fat3NfyxDtMZF2QiN0EwW21xJ9wI&gaa_ts=68daf800&gaa_sig=8b7PpLqF0r0vhXMm9SzNw5gj6dPTIlYKJQ0K8_tQLWFmSM0e5NTb_iS-DyTxgcmVlJ2kWO9riDPRPYAi1jdojw==

"Index funds were first considered nonsense. That nonsense now rules among many individual investors.

Index funds are probably the most enduring and transformative innovation for individual investors since mutual funds became available to them in 1928

"Index funds also revealed one of Wall Street’s secrets—that high cost mutual funds run by highly paid managers hardly ever outperform the market in the long run. Index funds, on the other hand, let anyone match the market’s return, minus tiny fees that these days are measured in hundredths of a
percent of an investor’s holding



In this world, low-cost, boring index funds start out with a huge advantage over shinier but higher-cost actively managed funds. That’s why index funds are likely to keep taking market share from active funds as far as the eye can see.
The first index mutual fund was created August 31, 1976

The first ETF was created in 1993

 
I'm a relatively old geezer. I remember as a little kid getting silver dimes and quarters in change. Not occasionally but totally silver coins. (The copper-nickel coins did not come into existence until 1965.) So let see . . . late 1963 - say I had $1000 to invest. Which would have done better - taking my $1000 to the bank and getting a pile of silver coins, or buying that cumulative 100% equity bundle? (Never mind the fact that in 1963, that was impossible to do with a small amount; no ETFs no no-load mutual funds.)

A new dime, quarter, or half dollar had .723 ounces of silver per dollar then. Allowing for wear, I would use .715 oz per dollar. That works out to a $1.40 per oz. Current price of $47 oz divided by $1.40 = 33.5 times the original investment.

I look at your chart. It says cumulative. Does that mean with dividends reinvested? I will assume yes, pending more information.
The price of that basket of stocks, based upon my attempt to read the chart at late 1963, would be $900. $33033 divided by $900 = 36.70 times.

Now 36.70 is greater than 33.5, but as John Wayne said in Rio Bravo, "I'd hate to have to live on the difference".

I point all this out to remind you that the dollar has been shrinking in purchasing power for many decades. Much of that stock return is illusion, it's just effect of inflation. If you don't like metals, look at the price of hamburgers over the same period, or other stable technology products. (No matter how cheap and fast computers get, a hamburger is still going to be a hamburger.)
And if you would have started that silver investment in January, 1980 (45 years ago), your return would be negative as of today. I know that was an anomaly (although silver did top out around $48 again in 2011), but it just goes to show how volatile silver has been in the past. If history repeats itself, this may also be a silver bubble and in 2070 (45 years from now) the price of silver will be the same as it is today.

Kurt
 
And if you would have started that silver investment in January, 1980 (45 years ago), your return would be negative as of today. I know that was an anomaly (although silver did top out around $48 again in 2011), but it just goes to show how volatile silver has been in the past. If history repeats itself, this may also be a silver bubble and in 2070 (45 years from now) the price of silver will be the same as it is today.

Kurt
Also, look at the dotcom bubble in the late 1990's and the NASDAQ drop of 78% by the end of 2002, or the real estate bubble in the mid 2000's. Every market has bubbles. The price of burgers still went up. . .

The stock market took 25 years to recover from the 1929 crash.
 
Year to Date

GOLD UP 43.79%

DOW UP 9.09%

BIG difference !

If you want to know why central banks are dumping dollars to buy gold, you might want to look at this:
And it is just as bad for all major fiat currencies. The currencies with NO debt? gold and silver
The problem with gold is that it doesn't have any inherent value. It could end up being worth as much as other historic stores of value like frankincense and myhrr
 
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