DOW 20k!!! - the investing thread

Hopefully this is just a correction and not a warning of more to follow.

 

I retired in 2013 just as the market was recovering from the 2007/2009 "crash". Has been a pretty good run since then with a few hiccups, but nothing like 2007-2013. Glad I didn't retire in 2007 though as I was self-funded/self-insured for a few years. Obamacare in a good state while unemployed wasn't so bad.

 

"It always comes back" is coming to an end.

 

With the rise of BRICS and a lot of countries getting tired of the worldwide monopoly of the almighty dollar, I wouldn't count on the status quo always being there.

 

Regardless of the downturn, my portfolio is still way above where it was at this time last year, and a bit above where it was in April of this year.

Not to say I didn't "lose" money compared to the high on July 16, 2024 and if looking at just that timeframe it is a good chunk of money. But looking at the this time last year, I've done so much better. The market goes up, the market goes down, then it does it all over again.

I've been in this since in the 80's, so I just don't even look when everyone else is panicking and doom-and-glooming so I'm not tempted to do anything stupid. Also, it seems to me that it is pretty typical for the market to fall shortly before presidential elections - although that is just my thought and I'm not going to try to prove it as I'm not presenting it as fact.

 

As financial advisors state, past performance does not guarantee future gains.

Review risk and determine if that's for you.

Over the past several years, with us both retired, we've followed our advisor's suggestions for safer investments with opportunities for growth.

There's no need for home runs. Many baseball players make lots of $'s hitting singles.

 

Not trying to be bossy / stick nose in BUT money you need in 3-5 years should already be out. Or have a transition plan in place..

 

Yep. This is my plan....

 

Does anyone know about Ascensus? I can’t find anything useful on the web. Supposedly they bought out some/all of Vanguards IRA’s. They claim to be the largest independent retirement plan administrator. I find this hard to believe. I know you can’t go wrong with Fidelity, Edward Jones, Charles Schwabe, etc.

 

Ascensus was bought/acquired by Stone Cold Capital (which may or may not mean much of anything)
LittleSis: Charles A Davis

I'd be more worried about Schwab. Aside from their bank having the same problem with holding bonds when interest rates went up, they've now divested from their bank business, which is where they were getting quite a bit of their income, which I can't make sense of.

 

Daves proud of you!

 

Have some CDs maturing in a few weeks...looks like rates are down a bit from where they were... anything good going on out there that I need to check out?

 

In 2000, and again in 2007 the market topped 2-3 weeks after the first Fed rate cuts prior to +50% drops and prolonged bear markets in the S&P 500.

Maybe this time is different, and we continue to make new highs in the short term, but I think we are likely on the verge of a recession. The most recent job creation numbers have been revised downwards, and the 12,000 print yesterday was the lowest since 2020.

Realistically speaking we need a fairly deep recession sooner rather than later to deal with persistent inflation, wild speculation, and gross distortions in asset values. We don’t need ever increasing fiscal deficits, and the Fed to provide more QE and ZIRP. The tax we will are all paying on this plan is inflation, which is the cruelest tax of all on those who can least afford it…those on fixed incomes, lower skill workers, and young people just trying to establish their independence and household formation.

Another thing to consider is that both bond bull and bond bear markets span decades, and we have come off a 40 year bond bull market. The trajectory of interest rates is likely higher for quite some time, which will continue to put negative pressure on the stock market.

If I had decades to put money to work in the stock market, I would still have most of my money there as we did through the great financial crisis.

Now, 2 years from retirement, most of our money is in stable value, CDs, and high interest savings (4.5%). We have a good chunk of money still in the stock market for longer term returns, but I wouldn’t be surprised if we are in for 10 years of very meager returns at best, (AI or not). We will be okay if I am wrong, but either way we sleep well at night.

 

I agree, the market can't keep going up forever. Four or five stocks have been propping up the S&P 500 for the last few years due to the AI boom. Eventually the boom is going to be over with and those stocks, along with the S&P 500 will come back to earth. My brother does investments for a large firm and he thinks that over looked value and small cap stocks ( cheaper for these companies to borrow money due to lower interest rates ) will be where the money will be made over the next few years.

Guess the big question is, what's the money for. Is it emergency fund, retirement money, play money, and what your appetite for risk is. If it was in CD I'm assuming you don't have much appetite for risk and want to keep it in something relatively safe. You could look into a high yield savings account or a money market fund. Over the summer the VMFXX money market fund I linked was paying around 5.5%, it looks to be paying under that now because the fed lowered interest rates. If you have a little more appetite for risk then I'd look into an index fund or a actively managed mutual fund ( more fees though ) that has a good track record ( look for something that's done well for 20+ years IMHO ) as park it in there and don't look bother looking at it for a while.

As with any investment advice, please take my advice with a grain of salt.

 

The S&P has trended up since 1923. At a rate somewhere between 7 and 11 percent depending on when the snapshot was taken and who was doing the analysis. Often just the last thirty years gets scrutinized because the last thirty years has been a pretty good run despite the deviations. After you adjust for inflation the yield curve isn't all that impressive, but it is positive. Often there is more clarity to a log scale so check that out when you can.

 

This is basically savings that I wanted some yield on, but also want access to if needed.

 

1023 doesn’t sound right

But US market started in 1790s (iirc) Philadelphia; New York didn’t become largest city until completion of Erie Canal to obtain goods and water to trade.. trading in 1860s so how come every starts in the 1920 One of my pet peeve’s

 

1923 - S & P
1957 - S & P 500

It's just an index and constantly in flux, so one could get nitpicky about that, too.
Those are the dates I'm familiar with. I could be wrong. It's so easy to be wrong about the market.

 

Ok billb3 my point is even the great s&p 500 which is an index that throws the losers out and gives winners a higher weight in it; and should go up
Every year… was down in total from 1969 to 1980

now even taking this into consideration I will tell you the market did not go up 20% 3 of the last 4 years!!
Yes it did ok.. in US $$ we’ll all things are a function
The price is numerator what’s the denominator us$
Price markets in gold different numbers!!
brenndatomu is asking ideas he’s been in cds that means he conservative he’s older.

my point is right now the market is a business a big business and don’t think “they” give you real numbers or care about you

 

A year or two ago I would have thought sticking a portion of it into the S&500 and letting it roll would be good advice but my viewpoint has changed after reading the two articles I've linked in this post. A friend sent me them this article recently. And like I mentioned earlier, my brother said that only 5 companies made up the majority of its returns.

Was talking to my ex yesterday and she said she opened up an high yield saving account for my kid with a local bank and they guaranteed her at least $600 worth of interest if she kept X dollars in the account for a year. It might be worth seeing if there are any local banks in your area that might be offering something like that. I looked yesterday on Treasury Direct and bonds aren't paying much these days due to the fed cutting rates. If the fed continues to cut rates, the bottom is going to drop out of these types of investments. That's one of the few upsides of high interest rates that a lot of folks don't see.