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Does Market Timing Work?

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Re: Does Market Timing Work?

#181

Post by paulpauper »

TacticalCoder wrote: post #79
zer0tonin wrote: post #54

Earlier quoted context omitted.

The dogma that it's impossible to beat the market is frankly weird at this point. If the markets were truly efficient, randomly picking stocks would beat SPX ~50% of the time. Since markets are not super efficient, basic exposure to performance factors (small cap, value, momentum...) puts you at a fairly high likelyhood of beating SPX.

> The dogma that it's impossible to beat the market is frankly weird at this point. I agree. Meta was literally priced below $90 not even a year ago (I entered at about $100 FWIW, which was my nice and round number). Now at $315. Anybody who believes the market is efficient is on some serious drugs. The market correctly valued Meta a $380 or so before the crash (because "TINA" I'm supposed to believe), then correctly…

same here. meta's core business was unhurt by metaverse losses

Re: Does Market Timing Work?

#182

Post by bumby »

LapsangGuzzler wrote: post #164
sandworm101 wrote: post #149

Earlier quoted context omitted.

>> 1 - People should be able to retire. Why? Retirement is a very recent phenomena. The idea of someone earning enough during their working life to then fund several decades of non-working life is a very modern thing, maybe only the last sixty years or so. Only a very rarified few were ever wealthy enough to actively stop working prior to becoming physically unable to work. And then, for most all of human history, th…

You could apply this argument to so many modern workforce changes, for example, the 40-hour 5-day workweek. Throughout history, most workers have not had the kind of rights that they do today. I think we all deserve to make progress on things like retirement instead of making arguments like this. Sure, retirement hasn’t always been a guarantee, but can we agree that this isn’t a good thing? We never question the desi…

While I agree that most of society should be the beneficiary of productivity gains, I’m not sure retirement is still a net positive. It seems like a lot of health and well-being is related to being a valuable member of society and fortunately or unfortunately, for many, work provides that function.

Re: Does Market Timing Work?

#183

Post by dh2022 »

the_gastropod wrote: post #166
missedthecue wrote: post #161

Earlier quoted context omitted.

No, I mean societally it's unaffordable. The government will eventually need to raise taxes significantly or begin means testing it. The current system is mathematically unsustainable

The current system is mathematically unsustainable pretty much by the design of a certain political faction interested in demonstrating the incompetence of government. Removing the income cap—currently around $160k—on the social security tax would do a great deal to make social security sustainable (and more equitable).

If they remove the cap on retirement contributions they should also remove the cap on retirement payouts. I would love to see social security pay former CEOs millions of dollars per year:)

Re: Does Market Timing Work?

#184

Post by voiceblue »

codethief wrote: post #93
achrono wrote: post #80

Earlier quoted context omitted.

FWIW ever since Kahneman, Ariely and similar company have had some of their theories get discredited (Ariely's taint is worse because it's to do with fabricating research!) I have gone back to simply resorting to common sense and quotidian skepticism.

> ever since Kahneman […] have had some of their theories get discredited Could you elaborate?

https://replicationindex.com/2020/12/30/a-meta-scientific-pe...

Re: Does Market Timing Work?

#185

Post by Findeton »

theptip wrote: post #142
rr808 wrote: post #113

The problem with buy and hold and pretty much every current strategy is that its distorted by the huge 40 year bull market we've seen in the USA. Every American asset has gone up big time - of course "time in the market" is a good thing. If you look at Japanese or European stock markets they tell a very different story. Similarly the next 40 years in the USA could be a miserable time for investors. I can't believe ho…

> No one really knows but it wont be as good as the last few decades. Such confidence! The first part is of course true, but you’ll make money teaching the market that you are smarter if the latter is true. Perfectly possible that AI kicks the economy into overdrive in the next few years and growth increases. I wouldn’t bet my house on it, but also wouldn’t bet my house against it either.

Absolutely no chance that AI is able to do that. Investing decisions are too subjective for the current state of AI. A good value investor knows this… and also knows that you don’t need a bull market to make decent returns.

Re: Does Market Timing Work?

#186

Post by Findeton »

wolverine876 wrote: post #146
tlarkworthy wrote: post #137

Earlier quoted context omitted.

I believe human ingenuity and power over the elements goes up 7% a year, of which, the stock market is a proxy for. We are a networked organism and good at leveraging innovation at a global scale through supply chains. I see no reason to be pessimistic, we have AI, we have better space flight, we constantly improving energy sources.

Then why didn't the markets go up in Japan and Europe (per the GP)? Also, why do the US (and maybe other) securities markets increase when the underlying economy is performing poorly?

What is “the markets” for you? If you mean the stocks in in indexes you’re right, but that’s not the whole market.

Re: Does Market Timing Work?

#187

Post by LapsangGuzzler »

bumby wrote: post #182
LapsangGuzzler wrote: post #164

Earlier quoted context omitted.

You could apply this argument to so many modern workforce changes, for example, the 40-hour 5-day workweek. Throughout history, most workers have not had the kind of rights that they do today. I think we all deserve to make progress on things like retirement instead of making arguments like this. Sure, retirement hasn’t always been a guarantee, but can we agree that this isn’t a good thing? We never question the desi…

While I agree that most of society should be the beneficiary of productivity gains, I’m not sure retirement is still a net positive. It seems like a lot of health and well-being is related to being a valuable member of society and fortunately or unfortunately, for many, work provides that function.

> and fortunately or unfortunately, for many, work provides that function.

I agree with this, but the problem is that there is no guarantee of work being available to everyone. With the rise of AI and hyper-specialization of work, that problem is only going to get worse.

Re: Does Market Timing Work?

#188

Post by pjlegato »

wolverine876 wrote: post #159
missedthecue wrote: post #158

Earlier quoted context omitted.

It's called social security and it's enormously expensive and borderline unaffordable... And not even enough to retire on comfortably

Yet it works so well that the public overwhelmingly supports it. > borderline unaffordable It's funded by your own income; it's a compulsory savings plan.

This is a common and fundamentally incorrect misconception about Social Security. Many subsequent policy debates are then misinformed.

Your money is not ever saved for you. Your retirement is NOT funded by your own past taxes. Your retirement is funded by those younger people who are then working and paying taxes.

You can see the details at https://en.wikipedia.org/wiki/Social_Security_Trust_Fund

Payments to retirees are made out of _currently incoming funds_. That is, the money paid in taxes by people currently working is immediately distributed to retired people who are receiving Social Security payments.

It is, in other words, NOT a savings plan. Full stop.

This scheme sort of worked in the 1930s when life expectancies were much lower and only a few people survived to retirement age relative to the much larger number of working people paying taxes.

Since 2009, Social Security has operated at an annual loss: the amount paid out has begun to exceed the incoming taxes. The deficit is expected to increase a lot in the coming years. (See https://www.cbo.gov/sites/default/files/cbofiles/attachments...)

Whatever you may think about whether Social Security is a good idea or whether the goverment ought to provide for retirement, it's clear that the current structure is not going to do that for much longer. A large-scale reform of some kind is coming.

Re: Does Market Timing Work?

#189

Post by danans »

Findeton wrote: post #185
theptip wrote: post #142

Earlier quoted context omitted.

> No one really knows but it wont be as good as the last few decades. Such confidence! The first part is of course true, but you’ll make money teaching the market that you are smarter if the latter is true. Perfectly possible that AI kicks the economy into overdrive in the next few years and growth increases. I wouldn’t bet my house on it, but also wouldn’t bet my house against it either.

Absolutely no chance that AI is able to do that. Investing decisions are too subjective for the current state of AI. A good value investor knows this… and also knows that you don’t need a bull market to make decent returns.

> Investing decisions are too subjective for the current state of AI

I think they are talking about AI driving growth in the broader economy, not making investment decisions.

Even still, it's not clear that AI will drive that kind of growth.

Re: Does Market Timing Work?

#190

Post by pjlegato »

sandworm101 wrote: post #149
Devasta wrote: post #136

Earlier quoted context omitted.

1 - People should be able to retire. 2 - Their retirement should be financed by 401ks and the like. 3 - Stock Markets can go down as well as up. You can't have all three, so the government will always ensure that the stock market goes up long term.

>> 1 - People should be able to retire. Why? Retirement is a very recent phenomena. The idea of someone earning enough during their working life to then fund several decades of non-working life is a very modern thing, maybe only the last sixty years or so. Only a very rarified few were ever wealthy enough to actively stop working prior to becoming physically unable to work. And then, for most all of human history, th…

Too many people here use the drive-by "downvote" as a means of expressing their disagreement. This comment is a perfectly rational and polite contribution to an on-topic intellectual discussion of retirement, yet has received a large number of downvotes.

People, if you disagree, that's fine, but make some kind of a (polite, rational) counterargument rather than abusing "downvote" to express your visceral disgust at becoming aware of an opinion that differs from your own.

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