[2020] A little stock market sense

[Brett]

S&P 500 and Dow Rise to Records
https://www.cnbc.com/2024/09/22/stock-market-today-live-updates.html

 

[PigsDad]

Neither have I, so I stick to just the price. There are lots of charts for that. What I was showing is the shift of relative value for the two competing investments over time.price

I understand, but if you are comparing gold charts to price index charts instead of return index charts, it really means nothing since it is an apples to oranges comparison. At that point, it is like comparing gold price to avocado production -- might be interesting but means nothing. You certainly can't make any conclusions on "relative value" since the price index charts don't include a huge portion of an investor's value without the dividends included.

Kurt

 

[spthomas]

Another contrarian thought. When we do as is often suggested, get out of the market and into "safer" investments like CDs or annuities or money market instruments, it could be we're preserving capital. But, another way to look at that is we are avoiding the risk of sub-par returns or even losses by throwing the gains away up front, by going from 10% or so average returns in the stock market to 3% or so average returns for "safer" instruments like treasuries or CDs. In that scenario, even in good years you threw away 7%.

My retirement plan was to contribute to my stock market fund every year, and ignore everything else. I started in 1988, and I rode out (by doing nothing) the big dips. Of the money in my fund when I retired in 2022, 10% was what I contributed, and 90% was earnings from the stock market. And I did take about 50% hits in 2000-2001 and 2008, and still ended up with huge gains, because the market came back.

Everyone should just do what you want, and pay attention to your own advisors. I'm not trying to convince anyone of anything. This is what's working for me.

 

[Ralph Sir Edward]

Since you are interested in dividends, here's a chart for you

 

[WaikikiFirst]

In the year 2024, that chart is BS. The underlying "thought" may even be kinda-sorta true. The boxed comment is true, but the chart itself is pure BS. ANyone else want to point out why?

Sad to think people really fall for that kind of nonsense, aka are so easily fooled by cherry-picked #s thrown on a page as a splashy graphic.

 

[Ralph Sir Edward]

In the year 2024, that chart is BS. The underlying "thought" may even be kinda-sorta true. The boxed comment is true, but the chart itself is pure BS. ANyone else want to point out why?

Sad to think people really fall for that kind of nonsense, aka are so easily fooled by cherry-picked #s thrown on a page as a splashy graphic.

The gap was because of the 50% bear market for the S&P 500 during 2000-2002.

 

[WaikikiFirst]

because of the 50% bear market for the S&P 500 during 2000-2002

Which was led by tech stocks, which had bubbliciously soared in '98 & '99, most of which did not pay dividends, and almost all of which WERE NOT AROUND FOR 25 YEARS.
Step right up. Somebody tell us how much the SP500 (led by tech stocks) beat those "Aristocrats" by in the 2 or 3 years prior to the beginning of that chart.
Step right up. Somebody tell us how much the SP500 (led by tech stocks) beat those "Aristocrats" by in the 21 months since the end of that chart.
Step right up. Somebody tell us how much the SP500 beat those "Aristocrats" by over the last 30 yrs.

I'm off to pick some cherries.

 

[WaikikiFirst]

Hint: on the day that person made that chart, the best conclusion was "Hmmm, time to switch OUT of the Aristocrats"

 

[Brett]

S&P 500 posts record close to cap winning month and quarter​

https://www.cnbc.com/2024/09/29/stock-market-today-live-updates.html



.

 

[Brett]

Dow closes at record high after blow-out jobs report​

https://www.nbcnews.com/business/ma...tock-market-today-live-updateshtml-rcna174105

 

[letsgobobby]

new all time stock market high

no it does not ever get old

since this thread started on March 20, 2020 the s&p500 has increased from 2500 to 5800, a gain of 132%... plus dividends, for an annualized return of about 23%

 

[Brett]

S&P 500, Dow Break Records on Strong Financial Earnings
https://www.cnbc.com/2024/10/10/stock-market-today-live-updates.html








..
however;
https://www.nytimes.com/2024/10/11/business/stocks-investing-bull-market.html

"I’m a buy-and-hold investor, using broad, global stock and bond index funds for nearly all my holdings. As a result, I don’t fret much about short-term market movements.

This long-term approach gives me a certain emotional distance from the markets. Lately, rebalancing has been my main task: reducing stock funds that have swelled as the market has risen and increasing fixed-income holdings.

I’ll freely admit that I would be much better off right now if I held only stock funds this year — or, better yet, nothing but shares of Vistra, Nvidia and Constellation Energy. But that’s OK. I’m happy to have reduced the volatility of my investments. It has helped me sleep well at night."

 

[Brett]

.
But gold, real estate and other assets have also set new "record" levels

 

[WaikikiFirst]

But gold, real estate and other assets have also set new "record" levels

There is this thing called "Inflation". Perhaps you have heard of it?

so what is wrong with bitcoin? China? Oil? all the same answer?
note: I know quite well what is wrong with China. It is rhetorical.

 

[WaikikiFirst]

fun with AI: NVDA & some other AI stuff hit a record high closing price yesterday I think. During my late afternoon run yesterday, I was pondering 7 settled on the thought: "Well, we know that someday soon, somebody will start spreading rumors & the nutjobs will start SELL SELL SELLING like the nutjobs they are. Fundamentals don't matter. They are what they were when NVDA was @ $100 & then @ $140 & then back to $100 & now back to $140 & maybe someday back to $100.

LOL. It took about 14 hrs. 15 minutes after the mkts opened, rumors, innuendo, sell the ATH came together & NVDA fell 7% in about 1 hour. So did the others.
Fun fun fun, til daddy took the trading account away

 

[WaikikiFirst]

tiny Caribbean island of Anguilla has turned the AI boom into a digital gold mine​

Buried under all the nonsensical AI stuff you read in the last few months & will read in the next few months, here's some fun:
Anguilla was given the .ai internet address in the 1990s. They are allowed to let anyone use the ".ai" ... for a price. Anguilla's earnings from web domain registration fees quadrupled last year to $32 M & now = 20% of Anguilla's total government revenue. Before the AI boom, it was 5%. (ha, I guess 20/5 = "quadrupled". Who knew?)

 

[Rjbeach2003]

I didn't want to read every post, but I looked and found that the Dow closed at 23,248 on May 12, 2020, and closed today at 42,470.

 

[easyrider]

The story I heard is that inflation will cause assets, including stocks, to continue to rise. With the recent rate cut it is thought that inflation will increase. With this current situation, some "experts" are calling it a reverse stock market crash.

Bill

 

[emeryjre]

Every day of listening to CNBC
Some Talking head will tell the listeners the markets are going higher
Some Talking head will tell the listeners the markets are going lower
They all have their story about why the market will go up or down
The TRADERS who make money have figured out some part of the market that moves in a pattern they can decipher successfully
The INVESTORS who make money have diversified enough and stayed long the market through ups and downs
The people who lose money have no idea what they are doing and just place bets with no stop losses until they are broke

 

[rapmarks]

I am concerned about certain economic policies leading to a recession. I remember too well the last big one that resulted in not only stock market lows but the inability to sell your house for years. My friend says she thinks we need a recession. Why would we need a recession?

 

[VacationForever]

I am concerned about certain economic policies leading to a recession. I remember too well the last big one that resulted in not only stock market lows but the inability to sell your house for years. My friend says she thinks we need a recession. Why would we need a recession?

Maybe your friend is sitting on a lot of cash and have been waiting for decades to enter the stock market. Our friends have more than half their money sitting in CDs for the past 8 years waiting for the stock market to crash, and now they say that they will be running out of money to live on in about 7 years. They said they will have to downsize their home (worth about $1.7m, with a $350K mortgage) to get money out of it to live on. If they had invested in the stock market, they would not be running out of money.

 

[PigsDad]

Maybe your friend is sitting on a lot of cash and have been waiting for decades to enter the stock market. Our friends have more than half their money sitting in CDs for the past 8 years waiting for the stock market to crash, and now they say that they will be running out of money to live on in about 7 years. They said they will have to downsize their home (worth about $1.7m, with a $350K mortgage) to get money out of it to live on. If they had invested in the stock market, they would not be running out of money.

Another sad consequence of trying to time the market -- so worried about possibly losing some of their money and ended up losing more due to opportunity costs. Unfortunately, I think a lot of us have seen too many people like this.

Kurt

 

[easyrider]

I am concerned about certain economic policies leading to a recession. I remember too well the last big one that resulted in not only stock market lows but the inability to sell your house for years. My friend says she thinks we need a recession. Why would we need a recession?

For us, any real downturn in the economy resulted in lower real estate prices. Many of the people that have bought real estate as their main investment do prepare for a recession by having funds available to buy property when the prices go down. In 2008 , real estate prices tanked in some sectors about 60%. Some types of properties , like certain types of condos, had prices that dropped because there was no bank financing for them. Every type of property was on sale in 2008-09.

It's interesting that buying a property below market value, because of changing market values, due to economic conditions, isn't always the best time to buy a property. Eventually, cash loses value while assets gain value ,so waiting a decade with loads of cash isn't my idea of a good idea.

Bill

 

[Brett]

The story I heard is that inflation will cause assets, including stocks, to continue to rise. With the recent rate cut it is thought that inflation will increase. With this current situation, some "experts" are calling it a reverse stock market crash.

Bill

"reverse market crash" ! We know you're hoping for that "positive" crash Bill

"experts" are actually saying -


"U.S. stocks rose after better-than-expected corporate profit reports"

and

" Economists and forecasters are increasingly upbeat about the economy’s prospects"
https://www.wsj.com/economy/economists-predictions-survey-charts-68ba82d6

 

[Brett]

I am concerned about certain economic policies leading to a recession. I remember too well the last big one that resulted in not only stock market lows but the inability to sell your house for years. My friend says she thinks we need a recession. Why would we need a recession?

Like others have indicated, if you have been in the stock market long term and have a mix of index funds, bonds and CD's then you shouldn't fear (or hope for) a recession