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Dow plunges 1000 points

cnbc.com

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Re: Dow plunges 1000 points

#181

Post by prepend »

graeme wrote: post #121
tnorthcutt wrote: post #73

Earlier quoted context omitted.

On some level, though, all of retirement is a little ponzi-like; ultimately you're always relying on the current working population to pay for your retirement, no matter what investments you put into your pension fund. Well, no, not really. You're relying on the fact that you own some assets, which you can sell to someone else who wants to own those assets. That's very much not "ponzi-like".

You can't eat an asset. You can only eat what someone else produces, and then only if you can convince them to give you food in exchange for your asset. This is counterintuitive, but globally saving is not possible, in a financial sense. IIRC from economic models it nets out to investment. Which makes sense. Real world saving is amassing a grain store, or an oil stockpile in a strategic reserve, etc And we can't do v…

You can definitely eat stuff bought with the earnings of assets.

Retirement is non-ponzi like because the assets appreciate in value due to increased predicted future earnings. This is totally different from paying out what others pay in.

Assets can appreciate in value and income even without new investment.

Re: Dow plunges 1000 points

#184

Post by krrrh »

nodesocket wrote: post #109
krrrh wrote: post #90

Earlier quoted context omitted.

Do you want to list some of the ones you’re thinking of? I’m trying to level up on hedging strategies for retail investors. I was thinking of buying VIX on Friday, and am kicking myself for missing out now.

Curious what instrument you were going to buy the VIX through? $VXX? $VXX was only up (coughing) 33% while the CBOE VIX was/is up nearly 100+ %.

I hadn't looked into all the options to be honest, VXX was on my radar. So was TVIX[1], but figuring out how to optimize decaying short-term bets like these felt like too much for a non-expert. I'm certain there are smarter and less risky ways to hedge a market that seems overbought.

[1] https://sixfigureinvesting.com/2015/10/how-does-tvix-work/

Re: Dow plunges 1000 points

#185

Post by PoachedSausage »

meri_dian wrote: post #20

A market is like a forest and a market crash is like a forest fire. In order for the market to grow and be healthy in the long term, a purge every now and then is necessary.

Last time round (2008) we deferred the purge, when you do that the next forest fire is potentially even bigger.

Re: Dow plunges 1000 points

#186

Post by longerthoughts »

To put things in perspective: https://en.wikipedia.org/wiki/List_of_largest_daily_changes_...

Saying "Biggest Point Drop in History" is a deliberate attention-grabber and incites more fear than it probably should. We should be more concerned with percentage changes and at -4.6% this doesn't even make the top 20 daily percentage drops, which cuts off at -6.98% for number 20 (see above link).

Re: Dow plunges 1000 points

#187

Post by oculusthrift »

propman wrote: post #102

Inflation finally is going up after years and we can get out of this stagnating economy. Wage growth up 3% in new January report and so we can finally expect interest rates to rise faster like they did in the past. Many investors, especially institutional ones have for years thought the stock market has been over priced but where else to park money because interest rates are too low? Overall the 3% wage growth is hug…

how can you simultaneously care about the deficit and support the tax cuts. Cognitive dissonance?

Re: Dow plunges 1000 points

#188

Post by Gustomaximus »

propman wrote: post #102

Inflation finally is going up after years and we can get out of this stagnating economy. Wage growth up 3% in new January report and so we can finally expect interest rates to rise faster like they did in the past. Many investors, especially institutional ones have for years thought the stock market has been over priced but where else to park money because interest rates are too low? Overall the 3% wage growth is hug…

> economic indicators also show a very healthy economy so when the next recession hits we'll have the tools to stop it.

Will the tools be there? You basically have monetary policy limited as interest rates are already low. And fiscal policy is limited as major tax cuts are already given and the debt/deficit mean increasing spend is difficult or come with potential negative consequences.

Am I missing something?

I'm more hopeful the govt uses this window to get itself in a position to manage the next downturn vs ride the good times and then not have the tools for the bad.

Re: Dow plunges 1000 points

#189

Post by fma »

bhouston wrote: post #3

I do worry that this is the end of the current bull market and we'll be entered into a recession in the next half year or so.

Your worry is valid, however even bull markets have pullbacks. We haven't seen a real one in a while so naturally this is going to be bigger.

Re: Dow plunges 1000 points

#190

Post by DoreenMichele »

adsfasdfsad111 wrote: post #171
DoreenMichele wrote: post #147

Earlier quoted context omitted.

Non coastal real estate. You know, stuff that will still be land after the seas rise. Plus some company or other in the Netherlands exporting polder technology.

lol might as well get some canned food, bottled water and a shotgun while you're at it.

Don't be ridiculous.

I don't eat canned goods. Said land can be chosen to have a secured fresh water source. And in the post apocalypse, when you can't count on getting bullets, a bow is a better choice than a shot gun. Bonus points: it takes skill to shoot a bow, so most people can't take your bow and turn it against it.

Duh.

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