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What to know about the stock market (2007)

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Re: What to know about the stock market (2007)

#231

Post by greedo »

enriquto wrote: post #205
pembrook wrote: post #50

Earlier quoted context omitted.

Europeans can have the luxury of not worrying about investing since many European countries offer livable pensions (for now…the demographic future for this isn’t looking so good). However, this isn’t as great as it sounds. While the European model for healthcare and education is better, their pension schemes are arguably a much worse deal than what Americans can have. In Europe, you’re basically paying the government…

> There’s a surprisingly large amount of middle class Americans who will retire millionaires This seems like a serious bug in the system, doesn't it? Why would old people retire as millionaries while young people struggle working long hours and can barely save anything?

Because the lack of effective pensions require you to either work til you die or live off Social Security. Most people don't want to do either, so they direct a significant amount of their earnings to 401ks and the stock market.

The fact that young people struggle really doesn't have much to do with this.

Re: What to know about the stock market (2007)

#232

Post by thebean11 »

melenaboija wrote: post #225
choward wrote: post #187

Earlier quoted context omitted.

> Now, just wait, ideally 10+ years, before looking into your account again That might not be the best idea because of escheat. Here's a story about someone who didn't check on their stocks for years and the state claimed them. https://www.npr.org/transcripts/799345159

The poster says buy S&P ETF and walk away not stocks.

So stocks can be seized and ETFs can't..?

Re: What to know about the stock market (2007)

#233

Post by greedo »

pembrook wrote: post #50
sdevonoes wrote: post #11

Am I the only one in HN who is not into the stock market? I live in Western Europe and I would say 75% of my acquaintances don't do stock market. People I have known in the past (old people) didn't do stock market either. They all seem to have lived a normal life (decent jobs, decent house, decent family). Nothing extravagant but they got enough money to be "happy" in life.

Europeans can have the luxury of not worrying about investing since many European countries offer livable pensions (for now…the demographic future for this isn’t looking so good). However, this isn’t as great as it sounds. While the European model for healthcare and education is better, their pension schemes are arguably a much worse deal than what Americans can have. In Europe, you’re basically paying the government…

Yet there's a surprisingly large amount of middle class Americans who have no retirement savings; either due to YOLO, or medical emergencies, or misunderstanding how to invest towards retirements.

Re: What to know about the stock market (2007)

#234

Post by dionidium »

vishnugupta wrote: post #215
pembrook wrote: post #50

Earlier quoted context omitted.

Europeans can have the luxury of not worrying about investing since many European countries offer livable pensions (for now…the demographic future for this isn’t looking so good). However, this isn’t as great as it sounds. While the European model for healthcare and education is better, their pension schemes are arguably a much worse deal than what Americans can have. In Europe, you’re basically paying the government…

> There’s a surprisingly large amount of middle class Americans who will retire millionaires I would love to see some data around this. Because what I keep hearing (being in India) from the usual suspect sources is mostly gloom and doom[1] [1] https://news.ycombinator.com/item?id=27205734

It might depend on your definition of "surprisingly." According to this source, about 10% of American households are millionaires and about 80% of those are first-generation millionaires (i.e. they didn't inherit the money).

Additionally, only about 1% of those millionaires are under 35. (This is a point that gets lost in the debate about inequality, in my view; most wealthy people are old for what I think are extremely obvious reasons.)

https://spendmenot.com/blog/what-percentage-of-americans-are...

Re: What to know about the stock market (2007)

#235

Post by thebean11 »

enriquto wrote: post #205
pembrook wrote: post #50

Earlier quoted context omitted.

Europeans can have the luxury of not worrying about investing since many European countries offer livable pensions (for now…the demographic future for this isn’t looking so good). However, this isn’t as great as it sounds. While the European model for healthcare and education is better, their pension schemes are arguably a much worse deal than what Americans can have. In Europe, you’re basically paying the government…

> There’s a surprisingly large amount of middle class Americans who will retire millionaires This seems like a serious bug in the system, doesn't it? Why would old people retire as millionaries while young people struggle working long hours and can barely save anything?

The bug is working people struggling not middle class people having livable retirements

Re: What to know about the stock market (2007)

#236

Post by [deleted] »

lvl100 wrote: post #191
shoto_io wrote: post #157

Earlier quoted context omitted.

My stock advice for any rookie has always been the same: - Buy S&P ETFs, most preferably by Vanguard, because they are a non-profit and thus have very low fees - If you have a large sum of cash, go all-in immediately, don't wait for the perfect time - Now, just wait, ideally 10+ years, before looking into your account again

This is such a bad advice. Buying an index is what they want you to do. They want you to buy and hold until you retire. Do you not see the problem with that logic?

[deleted]

Re: What to know about the stock market (2007)

#237

Post by gitfan86 »

bradfa wrote: post #117
3pt14159 wrote: post #99

Earlier quoted context omitted.

People keep telling me this, but I keep beating the market. It's been 20 years or so of applying very basic reasoning and getting ahead. 1. Commodities are bad long term bets because technology gets better. I remember people talking my ear off about peak oil and then the US turned into a net-exporter. Short term inelasticity, yes can sky rocket prices; but long term prices go down. 2. Physics based thinking. I knew e…

I've invested in GM and avoided investing in Tesla. Mostly just because I understand GM, their business and financials and stock price history makes sense to me. I do not understand the valuations on Tesla, and hadn't even long before COVID and the most recent run-up in value. Clearly I've missed out on massive earnings if I had invested in Tesla instead of GM (although GM's done decently lately). To me looking at th…

Forget the stock price. Look at operating margins, operating leverage, delivery volume, trailing delivery volume growth, battery supply, dealership contracts.

Re: What to know about the stock market (2007)

#238

Post by gitfan86 »

sireat wrote: post #221
3pt14159 wrote: post #99

Earlier quoted context omitted.

People keep telling me this, but I keep beating the market. It's been 20 years or so of applying very basic reasoning and getting ahead. 1. Commodities are bad long term bets because technology gets better. I remember people talking my ear off about peak oil and then the US turned into a net-exporter. Short term inelasticity, yes can sky rocket prices; but long term prices go down. 2. Physics based thinking. I knew e…

It is easy to say in hindsight but consider the case of Iomega. https://markets.businessinsider.com/news/stocks/big-short-in... In 1997 a friend who worked at Cisco told me to go all out on Iomega. He also advised me to invest in some 3D storage startup which well went nowhere. No matter how smart you are you just have to play percentages. Even better consider the case of Cisco itself. It reached market cap of 500B a…

Tesla is trading at a 50x PE (2022 consensus) and plans to grow 50%+ in 2023, 2024.

I don't think that you can expect the stock to be where it is today in 2024 if the PE actually goes down to 12. You'll need to buy it now to lock in that PE of your purchase price.

Re: What to know about the stock market (2007)

#239

Post by shoto_io »

logicalmonster wrote: post #226
shoto_io wrote: post #157

Earlier quoted context omitted.

My stock advice for any rookie has always been the same: - Buy S&P ETFs, most preferably by Vanguard, because they are a non-profit and thus have very low fees - If you have a large sum of cash, go all-in immediately, don't wait for the perfect time - Now, just wait, ideally 10+ years, before looking into your account again

Historically speaking, I think this has been one of the best things an average person could do within the context of a stable, safe, free, and productive society, but I don't think this kind of generic advice is really persuasive in the different and more turbulent world that exists right now. Additionally, because of many societal conditions, right now many people think they need to hit on a moonshot to have a good…

That's the story for many decades now. It turned out wrong every time.

See for example: https://ritholtz.com/2019/08/death-of-equities-40th-annivers...

Re: What to know about the stock market (2007)

#240

Post by flavius29663 »

pembrook wrote: post #50
sdevonoes wrote: post #11

Am I the only one in HN who is not into the stock market? I live in Western Europe and I would say 75% of my acquaintances don't do stock market. People I have known in the past (old people) didn't do stock market either. They all seem to have lived a normal life (decent jobs, decent house, decent family). Nothing extravagant but they got enough money to be "happy" in life.

Europeans can have the luxury of not worrying about investing since many European countries offer livable pensions (for now…the demographic future for this isn’t looking so good). However, this isn’t as great as it sounds. While the European model for healthcare and education is better, their pension schemes are arguably a much worse deal than what Americans can have. In Europe, you’re basically paying the government…

> livable pensions

This is a myth. People struggle on state pensions throughout Europe, but for some reason young Americans idealize everything that comes out of Europe.

In Germany(a country of 80 mil), the average pension is $1000 once you get to 65. In France it's not much more. The social security in the US beats that, plus you can usually afford a private pension, because the government doesn't take 50% of your paychecks.

I personally know someone in Austria that worked all his life for the railroad, then he got sicker and sicker, but the state wouldn't give him a disability pension. He could barely work sitting all day. Then he got disability at around age 60, but he needed money so much that he had to collect scrap metal to make ends meet. Very sick, after 60 years old, collecting metal. This is just an anecdote...I know, but still.

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