<< <i>Markets don't tell you this. Try explaining to an 80 year old saver that he's actually losing money on a 3% savings account when inflation is 5%. The market sure didn't explain it to him nor did his bank. >>
As has been repeatedly pointed out on this forum many times whenever this argument is made….this is the result of a poor investment decision. Simple as that. >>
Tens of millions of seniors don't play that game and probably shouldn't. My mother is 82 and has earned basically nothing on $500k in cash since 2008. Like or not ZIRP or <1% rates will be here for a long, long time. The equity markets love it.
>>
Your 82 year old mother should have had at least 20% of her money in the markets. That $100,000 would be worth $200,000 today. And it would have been the same as adding another $18,000 per year to her income. She still would have earned 5%, but probably listened to bad tv or ill informed family members in deciding to buy CDs. >>
Hindsight is pretty simple isn't it?
She had a lot in the equity markets in 2002 and got killed. Needed a different path at 70 years old and took it. The Fed has propped up their owners with what will end up being 10 years of ZIRP and $10 trillion in QE before it's over. We're barely half way there and with the banks owning Washington and The Fed it will get really nasty soon. Get ready because they will milk the USA to it's death. It's all about them unfortunately and they're just getting started.
Markets only tell the price. All other information must be sought out and deciphered.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>Markets don't tell you this. Try explaining to an 80 year old saver that he's actually losing money on a 3% savings account when inflation is 5%. The market sure didn't explain it to him nor did his bank. >>
As has been repeatedly pointed out on this forum many times whenever this argument is made….this is the result of a poor investment decision. Simple as that. >>
Tens of millions of seniors don't play that game and probably shouldn't. My mother is 82 and has earned basically nothing on $500k in cash since 2008. Like or not ZIRP or <1% rates will be here for a long, long time. The equity markets love it.
>>
Your 82 year old mother should have had at least 20% of her money in the markets. That $100,000 would be worth $200,000 today. And it would have been the same as adding another $18,000 per year to her income. She still would have earned 5%, but probably listened to bad tv or ill informed family members in deciding to buy CDs. >>
Hindsight is pretty simple isn't it?
She had a lot in the equity markets in 2002 and got killed. Needed a different path at 70 years old and took it. The Fed has propped up their owners with what will end up being 10 years of ZIRP and $10 trillion in QE before it's over. We're barely half way there and with the banks owning Washington and The Fed it will get really nasty soon. Get ready because they will milk the USA to it's death. It's all about them unfortunately and they're just getting started.
>>
Yes hindsight is very simple. In 2002 she should have had a diversified portfolio. She would be sitting pretty right now. She got scared, listened to the wring people and is now paying the price. That is not the Feds fault.
Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market.
Now me being into stocks also I know graphs of the stock market for the last 100 years have little meaning too. Let's get real the "Pullman cart company" went out of business so they drooped it and add another high flyer for their little graph to look real good, just like GM and all the 100's of companies that have been dropped. There's been quite the turn over in companies on those charts. It like graphing the price of corn and when the bottom falls out you just use beans since they're up. JMO
<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market.
Now me being into stocks also I know graphs of the stock market for the last 100 years have little meaning too. Let's get real the "Pullman cart company" went out of business so they drooped it and add another high flyer for their little graph to look real good, just like GM and all the 100's of companies that have been dropped. There's been quite the turn over in companies on those charts. It like graphing the price of corn and when the bottom falls out you just use beans since they're up. JMO >>
Getting rid of the losers and adding new winners is a good thing. That is the appeal of an equities index fund or ETF....great vehicles for investing in the market!
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<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market.
Now me being into stocks also I know graphs of the stock market for the last 100 years have little meaning too. Let's get real the "Pullman cart company" went out of business so they drooped it and add another high flyer for their little graph to look real good, just like GM and all the 100's of companies that have been dropped. There's been quite the turn over in companies on those charts. It like graphing the price of corn and when the bottom falls out you just use beans since they're up. JMO >>
Getting rid of the losers and adding new winners is a good thing. That is the appeal of an equities index fund or ETF....great vehicles for investing in the market! >>
<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market. >>
So lets just look at our lifetimes. In 1975 a $20 Saint was about $60, now $1300. Increase of about 21x. In 1975 the DOW was about 800, now 17,000. Increase of about 21x. Gold is no better than stocks and stocks are no better than gold.
<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market. >>
So lets just look at our lifetimes. In 1975 a $20 Saint was about $60, now $1300. Increase of about 21x. In 1975 the DOW was about 800, now 17,000. Increase of about 21x. Gold is no better than stocks and stocks are no better than gold. >>
So you think the DOW at 800 is measuring the same stocks in 2014 at 17000? Do I have that right?
Why not measure from 1974? Maybe because gold was fixed at 35 an ounce?
<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market. >>
So lets just look at our lifetimes. In 1975 a $20 Saint was about $60, now $1300. Increase of about 21x. In 1975 the DOW was about 800, now 17,000. Increase of about 21x. Gold is no better than stocks and stocks are no better than gold. >>
Low quote on Gold was $140 in 1975. Saint ratio over the last 39 years is closer to 7.5 to 1.
<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market. >>
So lets just look at our lifetimes. In 1975 a $20 Saint was about $60, now $1300. Increase of about 21x. In 1975 the DOW was about 800, now 17,000. Increase of about 21x. Gold is no better than stocks and stocks are no better than gold. >>
So you think the DOW at 800 is measuring the same stocks in 2014 at 17000? Do I have that right?
Why not measure from 1974? Maybe because gold was fixed at 35 an ounce? >>
We have this discussion all the time. I am using the DOW 30 as a basis. I know some stocks have changed, but so has the economy. Some stocks have gone bankrupt and other have vastly exceed the averages. There are many "points in time" that I could use to promote an argument for either side, but I am using an approximate average. $20 Saints did not trade for $35 in 1974, but i'll play your game. Gold increased by about 34 times from $35 to present price. In 1974 the DOW was at 575 and has increased about 30x to current price. Add in the dividends and the returns are the same.
All you have to do is plug in the list of the DOW 30 in 1975 and take out any brokerage fees and then you have a comparisons of apples to apples. It would take some work but I'm sure you could do it, putting in the next high flyer and kicking out the broke or struggle stock isn't a comparison of any value that I'm aware of.
Of course you have to put your money somewhere and that's why u spread it out. No one asset class is the holy grail. PM's are insurance. How much money have you made off that insurance on your car, home, life, medical? And for the record collectables made of gold aren't PM's but they sure can approach it if they are worn.
<< <i>Markets don't tell you this. Try explaining to an 80 year old saver that he's actually losing money on a 3% savings account when inflation is 5%. The market sure didn't explain it to him nor did his bank. >>
As has been repeatedly pointed out on this forum many times whenever this argument is made….this is the result of a poor investment decision. Simple as that. >>
Tens of millions of seniors don't play that game and probably shouldn't. My mother is 82 and has earned basically nothing on $500k in cash since 2008. Like or not ZIRP or <1% rates will be here for a long, long time. The equity markets love it.
>>
Your 82 year old mother should have had at least 20% of her money in the markets. That $100,000 would be worth $200,000 today. And it would have been the same as adding another $18,000 per year to her income. She still would have earned 5%, but probably listened to bad tv or ill informed family members in deciding to buy CDs. >>
You are asking an elderly person to forget everything they ever knew about savings and finance, and to become a "player."
We will just have to disagree. What is "average" 30 or 500 hand picked stocks out of thousands publicly traded stocks or taking all the stocks that are publicly traded and dividing them by that number to come up with the results? You know like you did in basic math in grade school. lol
"You are asking an elderly person to forget everything they ever knew about savings and finance, and to become a "player."
While I am in no way a financial "expert", I have been investing for 40+ years(showing my age here)…I never recall ever hearing that folks at any age, in any financial situation should ever not have at least some amount of their long term savings in the equity markets. Younger folks usually can have a higher percentage in equities as their longer time frame allows recovery from short term ups and downs that is normal market activity. Near or at retirement age folks should have some percentage in equities and the "mantra" has for as long as I can remember been a balanced portfolio at the most. More conservative investors can have less in equities but I have never heard of ever being totally out of the market at any age. Just me.
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<< <i>Markets don't tell you this. Try explaining to an 80 year old saver that he's actually losing money on a 3% savings account when inflation is 5%. The market sure didn't explain it to him nor did his bank. >>
As has been repeatedly pointed out on this forum many times whenever this argument is made….this is the result of a poor investment decision. Simple as that. >>
Tens of millions of seniors don't play that game and probably shouldn't. My mother is 82 and has earned basically nothing on $500k in cash since 2008. Like or not ZIRP or <1% rates will be here for a long, long time. The equity markets love it.
>>
Your 82 year old mother should have had at least 20% of her money in the markets. That $100,000 would be worth $200,000 today. And it would have been the same as adding another $18,000 per year to her income. She still would have earned 5%, but probably listened to bad tv or ill informed family members in deciding to buy CDs. >>
You are asking an elderly person to forget everything they ever knew about savings and finance, and to become a "player." >>
No, im asking the "elderly" person to practice what she had already known and construct a diversified portfolio. Why does everyone think the stock market is for "playing", while other assets are for "saving"? History has proven over and over again that PMs are just as risky and unstable as any other asset.
Even the basic rule of thumb would have been for this "elderly" lady to have had 30% of her money in equities in 2002. But I think I see the problem....prior to 2002 she was overweight equities and thats the reason why she got "killed". Had she been properly diversified she may have had a 30% drop in her equities from 2000 to 2002, but she would have had a 30% increase in her bond holdings during the same time.
<< <i>We will just have to disagree. What is "average" 30 or 500 hand picked stocks out of thousands publicly traded stocks or taking all the stocks that are publicly traded and dividing them by that number to come up with the results? You know like you did in basic math in grade school. lol >>
Interesting that these discussions about particular asset performances come after significant rises.
A pundit noted after the 2000 crash that the Barron's ads for mutual funds no longer touted the stellar 5 year annual returns. They of course failed to mention that an investor in 1999 would be down 35% or more in their particular vehicle.
Aside from that, getting back to the 75 year old retiree, I believe that the US Government has a responsibility to protect the value of its currency.
It is despicable that a guy who sold his home in 1970 for $20k, can now only buy a modest car with those proceeds, if he had stored the money in a secure vault.
Of course he would be considered a doofus, fool and an idiot for not investing those proceeds, but it really says more about the reckless folks in DC that have destroyed the value of the greenback, than the hapless person who trusted that it would maintain its value.
I do not believe it "says more about the reckless folks in DC". It says a lot more about the very poor, narrow minded, uneducated and blind sided character of such an individual. Again, just me.
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<< <i>"if he had stored the money in a secure vault"
I do not believe it "says more about the reckless folks in DC". It says a lot more about the very poor, narrow minded, uneducated and blind sided character of such an individual. Again, just me. >>
Point is, why is a US hundred dollar bill incapable of maintaining its value of a sustained period of time?
They are not inherently defective.
Of course we all know the reason. The currency is treated as dirt by those that are mandated to protect it.
<< <i>"You are asking an elderly person to forget everything they ever knew about savings and finance, and to become a "player."
While I am in no way a financial "expert", I have been investing for 40+ years(showing my age here)…I never recall ever hearing that folks at any age, in any financial situation should ever not have at least some amount of their long term savings in the equity markets. Younger folks usually can have a higher percentage in equities as their longer time frame allows recovery from short term ups and downs that is normal market activity. Near or at retirement age folks should have some percentage in equities and the "mantra" has for as long as I can remember been a balanced portfolio at the most. More conservative investors can have less in equities but I have never heard of ever being totally out of the market at any age. Just me. >>
We are of the same age group, I like to call it late middle age. The conventional wisdom for many years was to keep your money in fixed instruments, and not to depend on more than 5%. I don't remember hearing anything about keeping retirement money in equities until the last 10, maybe 15 years. Don't get me wrong, I've been in equities for years, but still have many friends in, or entering retirement who find the stock market nothing more than a roulette wheel. I spoke to my ex just recently about her portfolio, she has a high 6 figure IRA in cash, income property and won't even think about stocks.
another good sign today on cnbc... after the close alot laughing and making fun of gold, gartman said investment in gold in dollar terms was terrible, terrible, terrible,terrible...
Conventional wisdom was to subtract your age from 100. The resulting number was to be your exposure to equities. Hence, a person of 70 years should still have 30% of their assets in equities. Almost too simple, but in the world of investing, following the KISS principle is usually rewarding.
The conventional wisdom for many years was to keep your money in fixed instruments, and not to depend on more than 5%. I don't remember hearing anything about keeping retirement money in equities until the last 10, maybe 15 years.
That's the conventional wisdom that was touted for many, many years. Along with bonds of laddered maturities, annuities, and portfolio rebalancing. Every generation has iterations of various strategies that make at least some sense at the time.
As cohodk mentions, it was always recommended to reduce the % in stocks and to increase the % in fixed income securities as you approached retirement. That had always been the "conservative" approach to retirement planning. That may not be so good any more, at zero interest rates. But more recently the plan has become - first espoused by Bernanke - to move money into "risk assets". The real question is "Why?"
Diversification and portfolio rebalancing always get a lot of lip service here as being sound, conservative and intelligent methodologies for wealth building - and there IS a lot validity to these principles. My concern is that, much like the conventional wisdom of previous generations, there will be a point when these rational methods amount to being a tactical mistake, through no fault of ours. I can only surmise when or why this might be the case. We've been lied to in the past whenever it's expedient, so why would anything be different now?
As long as I've been contributing to Social Security and Medicare, it has always been recognized that the system is a Ponzi scheme that could never be sustained and that we would never see much, if any of the money that we put into the system. When congress decided to pilfer the funds from Social Security and to put those funds into the General Fund, it was pretty much a done deal that we wouldn't get out anything close to what we had put in. We've always known this to be the case, and yet there was nothing we working stiffs could actually do about it, short of stubbing our toe and applying for disability. The programs were mandatory, and much like obamacare these programs are really just another tax that were never actually called a tax when they were being sold to the public.
If you happen to be in a younger generation, you are now being funneled towards the stock market as the ticket to wealth and/or long term security. Just as in the years leading up to the Great Crash, people are day-trading and making money in stocks, commodities, etfs, or derivative contracts. It's almost too easy, and in my view that is a warning sign. The banking system isn't healthy. The world trade system isn't healthy. The government's finances aren't healthy.
The point is, you don't know what's going to happen and you don't know what's going to cause the next big market moves. Nobody does - well maybe except cohodk and Martin Armstrong. But nobody else does.
Oh, I'm in 100% agreement with the OP - deflation can be pretty bad. We've just never seen it in our lifetimes, yet.
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>The conventional wisdom for many years was to keep your money in fixed instruments, and not to depend on more than 5%. I don't remember hearing anything about keeping retirement money in equities until the last 10, maybe 15 years.
That's the conventional wisdom that was touted for many, many years. Along with bonds of laddered maturities, annuities, and portfolio rebalancing. Every generation has iterations of various strategies that make at least some sense at the time.
As cohodk mentions, it was always recommended to reduce the % in stocks and to increase the % in fixed income securities as you approached retirement. That had always been the "conservative" approach to retirement planning. That may not be so good any more, at zero interest rates. But more recently the plan has become - first espoused by Bernanke - to move money into "risk assets". The real question is "Why?"
Diversification and portfolio rebalancing always get a lot of lip service here as being sound, conservative and intelligent methodologies for wealth building - and there IS a lot validity to these principles. My concern is that, much like the conventional wisdom of previous generations, there will be a point when these rational methods amount to being a tactical mistake, through no fault of ours. I can only surmise when or why this might be the case. We've been lied to in the past whenever it's expedient, so why would anything be different now?
As long as I've been contributing to Social Security and Medicare, it has always been recognized that the system is a Ponzi scheme that could never be sustained and that we would never see much, if any of the money that we put into the system. When congress decided to pilfer the funds from Social Security and to put those funds into the General Fund, it was pretty much a done deal that we wouldn't get out anything close to what we had put in. We've always known this to be the case, and yet there was nothing we working stiffs could actually do about it, short of stubbing our toe and applying for disability. The programs were mandatory, and much like obamacare these programs are really just another tax that were never actually called a tax when they were being sold to the public.
If you happen to be in a younger generation, you are now being funneled towards the stock market as the ticket to wealth and/or long term security. Just as in the years leading up to the Great Crash, people are day-trading and making money in stocks, commodities, etfs, or derivative contracts. It's almost too easy, and in my view that is a warning sign. The banking system isn't healthy. The world trade system isn't healthy. The government's finances aren't healthy.
The point is, you don't know what's going to happen and you don't know what's going to cause the next big market moves. Nobody does - well maybe except cohodk and Martin Armstrong. But nobody else does.
I don't know that there are any "sound" investment methodologies these days.
No one knew in 1975 what what happen in 1985 and no one knew in 1995 what would happen in 2005, ect. But had one practiced "conventional wisdom" in their approach to investing everything for the most part would have been ok. Im sure the same approach will work from 2015 to 2025.
Is it not somewhat hypocritical to belittle someone for "having a realistic outlook" on the future, when they themselves say the same?
<<The point is, you don't know what's going to happen and you don't know what's going to cause the next big market moves. Nobody does - well maybe except cohodk and Martin Armstrong. But nobody else does.>>
Is it not somewhat hypocritical to belittle someone for "having a realistic outlook" on the future, when they themselves say the same?
It was a compliment. I was dead serious - you in the short term, Armstrong in the intermediate term. And roadrunner all of the time.
And it's not really accurate to say that "nobody else does" either. My bad.
I appreciate this forum. There's a lot of talent here.
Q: Are You Printing Money? Bernanke: Not Literally
"Most importantly, it is crucial to understand that the intrinsic value of the dollar is not rising. Real interest rates in the United States are still very much negative and the money supply is growing far faster than real GDP. Therefore, the dollar is only rising if measured against those countries whose central banks are actively trying to depreciate their currencies. And the U.S. Fed is about to rejoin in that effort."
As I have said numerous times, money velocity is the key to economic success:
"Japan, at least as long as it chooses to cling to the growth fairy, has nowhere to turn but to something in the vein of Abenomics, i.e. huge money and credit expansion. But it’s not the money supply, no matter how it’s defined, that is the problem, it’s that people refuse to spend. And if people don’t spend, no government or central banks has a way to boost inflation. Why they should want to in the first place is another question."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I used to think that I knew how things worked, or were supposed to work. Even since 2008, I've truly thought that I knew what the appropriate course of action should be.
derryb's 2 posts illustrate what I think is the new paradigm NOW, i.e. since about 3 months ago. After all, the Fed is the lead actor and I think we're at the point where everything is changing, AGAIN.
What does it mean? If a classical approach is taken I think it means that the dollar is going to be a prime asset and that the best move right now is to pay off debt, ex-post facto.
My problem is that I'm not so sure that classical anything makes sense any more. It could be that we are indeed tracking the same path as in 1929 and that the Fed's actions are as well, contrary to protestations to the contrary.
What I'm really wondering is whether there will be any other way out of the debt situation besides trying to manage their way out with bully pulpit bs and money creation, hoping that the economy will come back enough to salve the wounds.
In my opinion, the market economy can't recover from it's current condition. It's been skewed in different directions in too many ways.
If that's the case, are we looking at some kind of debt jubilee?
Or are we looking at what the doom & gloomers refer to as putting our kids and their kids into a permanent state of debt servitude? To make matters worse, gov.com keeps increasing the already large number of incentives for dependency on gov.com.
What's next?
Q: Are You Printing Money? Bernanke: Not Literally
-Strong dollar (weak PMs) until the FED, or the market (unlikely), say otherwise. -Fundamentals will remain on hold until they once again matter. Why? Because they will trump all counteractions designed to side-step them. -A major currency crisis will change things dramatically. Japan will most likely be the first domino via debt defaut. This will be the que to go all in with PMs. -A bond crisis will eventually erupt. Bonds are much easier to buy than they are to sell. ETF TBT will provide great rewards when the time comes. -Equities will eventually blow up. ETF VXX will provide great rewards when the time comes. -Ebola may be the unseen black swan event as could European Union failure, time will tell. -A sudden rise in PMs could trigger a delivery failure at COMEX creating an exponential panic. ETF USLV will provide great rewards if this occurs. -Continued use of economic sanctions are nothing short of economic warfare. A sudden increase in military or economic warfare is a game changer.
Metals could be near a bottom, but for now odds are greater that they will move lower. I'm building cash with periodic buys on silver where I find a low premium, usually an ebay purchase that offers a bonus ebay buck rebate. Just purchased two more tubes with the earned rebates.
We are in the midst of an economic minefield where a well executed PR program has kept most investors off their feet. Those without any PM patience should have already found the exit door. I'll continue to play the wait game.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
-A bond crisis will eventually erupt. Bonds are much easier to buy than they are to sell. ETF TBT will provide great rewards when the time comes. -Equities will eventually blow up. ETF VXX will provide great rewards when the time comes. -Ebola may be the unseen black swan event, time will tell. ETF USLV will provide great rewards if this occurs.
Do you think that the ETFs might have a general force majeure default, for any reason? That might concern me if I were trading them when a significant black swan event made an overnight appearance. The people I read note that when the exit closes, it will be too late.
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>-A bond crisis will eventually erupt. Bonds are much easier to buy than they are to sell. ETF TBT will provide great rewards when the time comes. -Equities will eventually blow up. ETF VXX will provide great rewards when the time comes. -Ebola may be the unseen black swan event, time will tell. ETF USLV will provide great rewards if this occurs.
Do you think that the ETFs might have a general force majeure default, for any reason? That might concern me if I were trading them when a significant black swan event made an overnight appearance. The people I read note that when the exit closes, it will be too late. >>
One man's opinion (as is most everything). Also note that ETFs are backed by the stability of the Fund that issues them. I personally believe that the threat of ETF failure is closely aligned with the failure of all paper promises - something that will most likely be preceded by amply warning to those paying attention.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
ETFs are very simple vehicles that allow investors to easily and efficiently build long-term portfolios or make a short-term bet on a wide variety of asset classes. But a look under the hood reveals a number of nuances and complex mechanisms that are in place to keep everything running smoothly. The recent spread of misinformation regarding the ETF structure serves as a valuable reminder for investors to do their homework and understand the details of various investment vehicles out there–and hopefully as a reminder to those in the media to check facts before spreading panic.
Nassim Taleb doesn't like complexity so much. Complex systems are more fragile. We have a lot of complex systems that are interdependent already. Cascading events happen fast now. I don't know the real answers, just observing.
Q: Are You Printing Money? Bernanke: Not Literally
My personal take: ETFs are only to be used for short-term bets on a wide variety of asset classes. Simple way to play the paper promise market. Make a wise selection and take the money and run (to another or opposing ETF, ie. USLV vs. DSLV). Physical PMs and remaining debt free are my long term portfolio.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
To go back to the scenario where the guy sold his house in the early 70s for 20K. If he put it in the S&P he would have a big pile of money. There were not ETFs following the S&P at that time, but you could still have put it in a diversified portfolio. Compounding over 44 years does wonders. The thing is, you have to be in for the long run, not trying to trade to hit the top or bottom, depending upon your strategy.
To those worried about deflation, the current prediction for GDP grow would wide is over 3% for next year. That would not suggest deflation. The Fed is trying to keep unemployment low and inflation below 2%, and cares not about the S&P. Central bankers see the world in a different light as their mandate is one that is different from what investors want to see. They understand economies at a different level than most. How many of us have dinner every night with a Nobel laureate in economics?
Retired United States Mint guy, now working on an Everyman Type Set.
Not according to Ben Bernanke. A fed chief he went so far as to say that he wanted to drive investors/savers away from short term instruments into riskier assets.
Not according to Ben Bernanke. A fed chief he went so far as to say that he wanted to drive investors/savers away from short term instruments into riskier assets. >>
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<< <i>To go back to the scenario where the guy sold his house in the early 70s for 20K. If he put it in the S&P he would have a big pile of money. There were not ETFs following the S&P at that time, but you could still have put it in a diversified portfolio. Compounding over 44 years does wonders. The thing is, you have to be in for the long run, not trying to trade to hit the top or bottom, depending upon your strategy.
To those worried about deflation, the current prediction for GDP grow would wide is over 3% for next year. That would not suggest deflation. The Fed is trying to keep unemployment low and inflation below 2%, and cares not about the S&P. Central bankers see the world in a different light as their mandate is one that is different from what investors want to see. They understand economies at a different level than most. How many of us have dinner every night with a Nobel laureate in economics? >>
I agree with you.
I manage money. I earn money. I save money . I give away money. I collect money. I don’t love money . I do love the Lord God.
dollar index beginning to experience lower lows and lower highs, good for PMs.
Saudis beginning what appears to be a price war with oil, bad for PMs.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
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<< <i>Markets don't tell you this. Try explaining to an 80 year old saver that he's actually losing money on a 3% savings account when inflation is 5%. The market sure didn't explain it to him nor did his bank. >>
As has been repeatedly pointed out on this forum many times whenever this argument is made….this is the result of a poor investment decision. Simple as that. >>
Tens of millions of seniors don't play that game and probably shouldn't. My mother is 82 and has earned basically nothing on $500k in cash since 2008. Like or not ZIRP or <1% rates will be here for a long, long time. The equity markets love it.
Your 82 year old mother should have had at least 20% of her money in the markets. That $100,000 would be worth $200,000 today. And it would have been the same as adding another $18,000 per year to her income. She still would have earned 5%, but probably listened to bad tv or ill informed family members in deciding to buy CDs. >>
Hindsight is pretty simple isn't it?
She had a lot in the equity markets in 2002 and got killed. Needed a different path at 70 years old and took it. The Fed has propped up their owners with what will end up being 10 years of ZIRP and $10 trillion in QE before it's over. We're barely half way there and with the banks owning Washington and The Fed it will get really nasty soon. Get ready because they will milk the USA to it's death. It's all about them unfortunately and they're just getting started.
A very excellent book.
I knew it would happen.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
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<< <i>Markets don't tell you this. Try explaining to an 80 year old saver that he's actually losing money on a 3% savings account when inflation is 5%. The market sure didn't explain it to him nor did his bank. >>
As has been repeatedly pointed out on this forum many times whenever this argument is made….this is the result of a poor investment decision. Simple as that. >>
Tens of millions of seniors don't play that game and probably shouldn't. My mother is 82 and has earned basically nothing on $500k in cash since 2008. Like or not ZIRP or <1% rates will be here for a long, long time. The equity markets love it.
Your 82 year old mother should have had at least 20% of her money in the markets. That $100,000 would be worth $200,000 today. And it would have been the same as adding another $18,000 per year to her income. She still would have earned 5%, but probably listened to bad tv or ill informed family members in deciding to buy CDs. >>
Hindsight is pretty simple isn't it?
She had a lot in the equity markets in 2002 and got killed. Needed a different path at 70 years old and took it. The Fed has propped up their owners with what will end up being 10 years of ZIRP and $10 trillion in QE before it's over. We're barely half way there and with the banks owning Washington and The Fed it will get really nasty soon. Get ready because they will milk the USA to it's death. It's all about them unfortunately and they're just getting started.
Yes hindsight is very simple. In 2002 she should have had a diversified portfolio. She would be sitting pretty right now. She got scared, listened to the wring people and is now paying the price. That is not the Feds fault.
Knowledge is the enemy of fear
Now me being into stocks also I know graphs of the stock market for the last 100 years have little meaning too. Let's get real the "Pullman cart company" went out of business so they drooped it and add another high flyer for their little graph to look real good, just like GM and all the 100's of companies that have been dropped. There's been quite the turn over in companies on those charts. It like graphing the price of corn and when the bottom falls out you just use beans since they're up. JMO
<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market.
Now me being into stocks also I know graphs of the stock market for the last 100 years have little meaning too. Let's get real the "Pullman cart company" went out of business so they drooped it and add another high flyer for their little graph to look real good, just like GM and all the 100's of companies that have been dropped. There's been quite the turn over in companies on those charts. It like graphing the price of corn and when the bottom falls out you just use beans since they're up. JMO >>
Getting rid of the losers and adding new winners is a good thing.
That is the appeal of an equities index fund or ETF....great vehicles for investing in the market!
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<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market.
Now me being into stocks also I know graphs of the stock market for the last 100 years have little meaning too. Let's get real the "Pullman cart company" went out of business so they drooped it and add another high flyer for their little graph to look real good, just like GM and all the 100's of companies that have been dropped. There's been quite the turn over in companies on those charts. It like graphing the price of corn and when the bottom falls out you just use beans since they're up. JMO >>
Getting rid of the losers and adding new winners is a good thing.
That is the appeal of an equities index fund or ETF....great vehicles for investing in the market! >>
Yea just like privy horse silver rounds...lol...
<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market. >>
So lets just look at our lifetimes. In 1975 a $20 Saint was about $60, now $1300. Increase of about 21x. In 1975 the DOW was about 800, now 17,000. Increase of about 21x. Gold is no better than stocks and stocks are no better than gold.
Knowledge is the enemy of fear
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<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market. >>
So lets just look at our lifetimes. In 1975 a $20 Saint was about $60, now $1300. Increase of about 21x. In 1975 the DOW was about 800, now 17,000. Increase of about 21x. Gold is no better than stocks and stocks are no better than gold. >>
So you think the DOW at 800 is measuring the same stocks in 2014 at 17000? Do I have that right?
Why not measure from 1974? Maybe because gold was fixed at 35 an ounce?
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<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market. >>
So lets just look at our lifetimes. In 1975 a $20 Saint was about $60, now $1300. Increase of about 21x. In 1975 the DOW was about 800, now 17,000. Increase of about 21x. Gold is no better than stocks and stocks are no better than gold. >>
Low quote on Gold was $140 in 1975. Saint ratio over the last 39 years is closer to 7.5 to 1.
You are correct, there is no one magic asset.
BINGO!
Correct, over the long term.....ya gotta be and stay diversified!
Simply as that.
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<< <i>Well one thing I know for sure gold can be tracked for 100 years but it doesn't indicate that governments had it fixed until the mid-70's but most stock guys like to act like it's always been in a free market. >>
So lets just look at our lifetimes. In 1975 a $20 Saint was about $60, now $1300. Increase of about 21x. In 1975 the DOW was about 800, now 17,000. Increase of about 21x. Gold is no better than stocks and stocks are no better than gold. >>
So you think the DOW at 800 is measuring the same stocks in 2014 at 17000? Do I have that right?
Why not measure from 1974? Maybe because gold was fixed at 35 an ounce? >>
We have this discussion all the time. I am using the DOW 30 as a basis. I know some stocks have changed, but so has the economy. Some stocks have gone bankrupt and other have vastly exceed the averages. There are many "points in time" that I could use to promote an argument for either side, but I am using an approximate average. $20 Saints did not trade for $35 in 1974, but i'll play your game. Gold increased by about 34 times from $35 to present price. In 1974 the DOW was at 575 and has increased about 30x to current price. Add in the dividends and the returns are the same.
Knowledge is the enemy of fear
Of course you have to put your money somewhere and that's why u spread it out. No one asset class is the holy grail.
PM's are insurance. How much money have you made off that insurance on your car, home, life, medical? And for the record collectables made of gold aren't PM's but they sure can approach it if they are worn.
No more than equities or real estate are insurance. The relative value of PM simply runs counter cyclical to other assets. That isnt insurance.
Knowledge is the enemy of fear
The apple is the stock market, not the DOW.
I am highly confident 30 years from now you will continue to be perplexed, or disillusioned by this.
Knowledge is the enemy of fear
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<< <i>Markets don't tell you this. Try explaining to an 80 year old saver that he's actually losing money on a 3% savings account when inflation is 5%. The market sure didn't explain it to him nor did his bank. >>
As has been repeatedly pointed out on this forum many times whenever this argument is made….this is the result of a poor investment decision. Simple as that. >>
Tens of millions of seniors don't play that game and probably shouldn't. My mother is 82 and has earned basically nothing on $500k in cash since 2008. Like or not ZIRP or <1% rates will be here for a long, long time. The equity markets love it.
Your 82 year old mother should have had at least 20% of her money in the markets. That $100,000 would be worth $200,000 today. And it would have been the same as adding another $18,000 per year to her income. She still would have earned 5%, but probably listened to bad tv or ill informed family members in deciding to buy CDs. >>
You are asking an elderly person to forget everything they ever knew about savings and finance, and to become a "player."
While I am in no way a financial "expert", I have been investing for 40+ years(showing my age here)…I never recall ever hearing that folks at any age, in any financial situation should ever not have at least some amount of their long term savings in the equity markets.
Younger folks usually can have a higher percentage in equities as their longer time frame allows recovery from short term ups and downs that is normal market activity.
Near or at retirement age folks should have some percentage in equities and the "mantra" has for as long as I can remember been a balanced portfolio at the most. More conservative investors can have less in equities but I have never heard of ever being totally out of the market at any age.
Just me.
<< <i>You are asking an elderly person to forget everything they ever knew about savings and finance, and to become a "player." >>
that's "Playa"...
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<< <i>Markets don't tell you this. Try explaining to an 80 year old saver that he's actually losing money on a 3% savings account when inflation is 5%. The market sure didn't explain it to him nor did his bank. >>
As has been repeatedly pointed out on this forum many times whenever this argument is made….this is the result of a poor investment decision. Simple as that. >>
Tens of millions of seniors don't play that game and probably shouldn't. My mother is 82 and has earned basically nothing on $500k in cash since 2008. Like or not ZIRP or <1% rates will be here for a long, long time. The equity markets love it.
Your 82 year old mother should have had at least 20% of her money in the markets. That $100,000 would be worth $200,000 today. And it would have been the same as adding another $18,000 per year to her income. She still would have earned 5%, but probably listened to bad tv or ill informed family members in deciding to buy CDs. >>
You are asking an elderly person to forget everything they ever knew about savings and finance, and to become a "player." >>
No, im asking the "elderly" person to practice what she had already known and construct a diversified portfolio. Why does everyone think the stock market is for "playing", while other assets are for "saving"? History has proven over and over again that PMs are just as risky and unstable as any other asset.
Even the basic rule of thumb would have been for this "elderly" lady to have had 30% of her money in equities in 2002. But I think I see the problem....prior to 2002 she was overweight equities and thats the reason why she got "killed". Had she been properly diversified she may have had a 30% drop in her equities from 2000 to 2002, but she would have had a 30% increase in her bond holdings during the same time.
Knowledge is the enemy of fear
<< <i>We will just have to disagree. What is "average" 30 or 500 hand picked stocks out of thousands publicly traded stocks or taking all the stocks that are publicly traded and dividing them by that number to come up with the results? You know like you did in basic math in grade school. lol >>
Cant argue with ignorance. You win.
Knowledge is the enemy of fear
A pundit noted after the 2000 crash that the Barron's ads for mutual funds no longer touted the stellar 5 year annual returns. They of course failed to mention that an investor in 1999 would be down 35% or more in their particular vehicle.
Aside from that, getting back to the 75 year old retiree, I believe that the US Government has a responsibility to protect the value of its currency.
It is despicable that a guy who sold his home in 1970 for $20k, can now only buy a modest car with those proceeds, if he had stored the money in a secure vault.
Of course he would be considered a doofus, fool and an idiot for not investing those proceeds, but it really says more about the reckless folks in DC that have destroyed the value of the greenback, than the hapless person who trusted that it would maintain its value.
I do not believe it "says more about the reckless folks in DC".
It says a lot more about the very poor, narrow minded, uneducated and blind sided character of such an individual.
Again, just me.
<< <i>"if he had stored the money in a secure vault"
I do not believe it "says more about the reckless folks in DC".
It says a lot more about the very poor, narrow minded, uneducated and blind sided character of such an individual.
Again, just me. >>
Point is, why is a US hundred dollar bill incapable of maintaining its value of a sustained period of time?
They are not inherently defective.
Of course we all know the reason. The currency is treated as dirt by those that are mandated to protect it.
<< <i>"You are asking an elderly person to forget everything they ever knew about savings and finance, and to become a "player."
While I am in no way a financial "expert", I have been investing for 40+ years(showing my age here)…I never recall ever hearing that folks at any age, in any financial situation should ever not have at least some amount of their long term savings in the equity markets.
Younger folks usually can have a higher percentage in equities as their longer time frame allows recovery from short term ups and downs that is normal market activity.
Near or at retirement age folks should have some percentage in equities and the "mantra" has for as long as I can remember been a balanced portfolio at the most. More conservative investors can have less in equities but I have never heard of ever being totally out of the market at any age.
Just me. >>
We are of the same age group, I like to call it late middle age. The conventional wisdom for many years was to keep your money in fixed instruments, and not to depend on more than 5%. I don't remember hearing anything about keeping retirement money in equities until the last 10, maybe 15 years.
Don't get me wrong, I've been in equities for years, but still have many friends in, or entering retirement who find the stock market nothing more than a roulette wheel. I spoke to my ex just recently about her portfolio, she has a high 6 figure IRA in cash, income property and won't even think about stocks.
after the close alot laughing and making fun of gold, gartman said investment in gold in dollar terms was terrible, terrible, terrible,terrible...
Knowledge is the enemy of fear
That's the conventional wisdom that was touted for many, many years. Along with bonds of laddered maturities, annuities, and portfolio rebalancing. Every generation has iterations of various strategies that make at least some sense at the time.
As cohodk mentions, it was always recommended to reduce the % in stocks and to increase the % in fixed income securities as you approached retirement. That had always been the "conservative" approach to retirement planning. That may not be so good any more, at zero interest rates. But more recently the plan has become - first espoused by Bernanke - to move money into "risk assets". The real question is "Why?"
Diversification and portfolio rebalancing always get a lot of lip service here as being sound, conservative and intelligent methodologies for wealth building - and there IS a lot validity to these principles. My concern is that, much like the conventional wisdom of previous generations, there will be a point when these rational methods amount to being a tactical mistake, through no fault of ours. I can only surmise when or why this might be the case. We've been lied to in the past whenever it's expedient, so why would anything be different now?
As long as I've been contributing to Social Security and Medicare, it has always been recognized that the system is a Ponzi scheme that could never be sustained and that we would never see much, if any of the money that we put into the system. When congress decided to pilfer the funds from Social Security and to put those funds into the General Fund, it was pretty much a done deal that we wouldn't get out anything close to what we had put in. We've always known this to be the case, and yet there was nothing we working stiffs could actually do about it, short of stubbing our toe and applying for disability. The programs were mandatory, and much like obamacare these programs are really just another tax that were never actually called a tax when they were being sold to the public.
If you happen to be in a younger generation, you are now being funneled towards the stock market as the ticket to wealth and/or long term security. Just as in the years leading up to the Great Crash, people are day-trading and making money in stocks, commodities, etfs, or derivative contracts. It's almost too easy, and in my view that is a warning sign. The banking system isn't healthy. The world trade system isn't healthy. The government's finances aren't healthy.
The point is, you don't know what's going to happen and you don't know what's going to cause the next big market moves. Nobody does - well maybe except cohodk and Martin Armstrong. But nobody else does.
Oh, I'm in 100% agreement with the OP - deflation can be pretty bad. We've just never seen it in our lifetimes, yet.
I knew it would happen.
That is key. One of them, anyhow.
I knew it would happen.
<< <i>The conventional wisdom for many years was to keep your money in fixed instruments, and not to depend on more than 5%. I don't remember hearing anything about keeping retirement money in equities until the last 10, maybe 15 years.
That's the conventional wisdom that was touted for many, many years. Along with bonds of laddered maturities, annuities, and portfolio rebalancing. Every generation has iterations of various strategies that make at least some sense at the time.
As cohodk mentions, it was always recommended to reduce the % in stocks and to increase the % in fixed income securities as you approached retirement. That had always been the "conservative" approach to retirement planning. That may not be so good any more, at zero interest rates. But more recently the plan has become - first espoused by Bernanke - to move money into "risk assets". The real question is "Why?"
Diversification and portfolio rebalancing always get a lot of lip service here as being sound, conservative and intelligent methodologies for wealth building - and there IS a lot validity to these principles. My concern is that, much like the conventional wisdom of previous generations, there will be a point when these rational methods amount to being a tactical mistake, through no fault of ours. I can only surmise when or why this might be the case. We've been lied to in the past whenever it's expedient, so why would anything be different now?
As long as I've been contributing to Social Security and Medicare, it has always been recognized that the system is a Ponzi scheme that could never be sustained and that we would never see much, if any of the money that we put into the system. When congress decided to pilfer the funds from Social Security and to put those funds into the General Fund, it was pretty much a done deal that we wouldn't get out anything close to what we had put in. We've always known this to be the case, and yet there was nothing we working stiffs could actually do about it, short of stubbing our toe and applying for disability. The programs were mandatory, and much like obamacare these programs are really just another tax that were never actually called a tax when they were being sold to the public.
If you happen to be in a younger generation, you are now being funneled towards the stock market as the ticket to wealth and/or long term security. Just as in the years leading up to the Great Crash, people are day-trading and making money in stocks, commodities, etfs, or derivative contracts. It's almost too easy, and in my view that is a warning sign. The banking system isn't healthy. The world trade system isn't healthy. The government's finances aren't healthy.
The point is, you don't know what's going to happen and you don't know what's going to cause the next big market moves. Nobody does - well maybe except cohodk and Martin Armstrong. But nobody else does.
I don't know that there are any "sound" investment methodologies these days.
Knowledge is the enemy of fear
Is it not somewhat hypocritical to belittle someone for "having a realistic outlook" on the future, when they themselves say the same?
Knowledge is the enemy of fear
Is it not somewhat hypocritical to belittle someone for "having a realistic outlook" on the future, when they themselves say the same?
It was a compliment. I was dead serious - you in the short term, Armstrong in the intermediate term. And roadrunner all of the time.
And it's not really accurate to say that "nobody else does" either. My bad.
I appreciate this forum. There's a lot of talent here.
I knew it would happen.
"Most importantly, it is crucial to understand that the intrinsic value of the dollar is not rising. Real interest rates in the United States are still very much negative and the money supply is growing far faster than real GDP. Therefore, the dollar is only rising if measured against those countries whose central banks are actively trying to depreciate their currencies. And the U.S. Fed is about to rejoin in that effort."
The dollar is about to inflict carnage around the world
As I have said numerous times, money velocity is the key to economic success:
"Japan, at least as long as it chooses to cling to the growth fairy, has nowhere to turn but to something in the vein of Abenomics, i.e. huge money and credit expansion. But it’s not the money supply, no matter how it’s defined, that is the problem, it’s that people refuse to spend. And if people don’t spend, no government or central banks has a way to boost inflation. Why they should want to in the first place is another question."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I used to think that I knew how things worked, or were supposed to work. Even since 2008, I've truly thought that I knew what the appropriate course of action should be.
derryb's 2 posts illustrate what I think is the new paradigm NOW, i.e. since about 3 months ago. After all, the Fed is the lead actor and I think we're at the point where everything is changing, AGAIN.
What does it mean? If a classical approach is taken I think it means that the dollar is going to be a prime asset and that the best move right now is to pay off debt, ex-post facto.
My problem is that I'm not so sure that classical anything makes sense any more. It could be that we are indeed tracking the same path as in 1929 and that the Fed's actions are as well, contrary to protestations to the contrary.
What I'm really wondering is whether there will be any other way out of the debt situation besides trying to manage their way out with bully pulpit bs and money creation, hoping that the economy will come back enough to salve the wounds.
In my opinion, the market economy can't recover from it's current condition. It's been skewed in different directions in too many ways.
If that's the case, are we looking at some kind of debt jubilee?
Or are we looking at what the doom & gloomers refer to as putting our kids and their kids into a permanent state of debt servitude? To make matters worse, gov.com keeps increasing the already large number of incentives for dependency on gov.com.
What's next?
I knew it would happen.
<< <i>What's next? >>
-Strong dollar (weak PMs) until the FED, or the market (unlikely), say otherwise.
-Fundamentals will remain on hold until they once again matter. Why? Because they will trump all counteractions designed to side-step them.
-A major currency crisis will change things dramatically. Japan will most likely be the first domino via debt defaut. This will be the que to go all in with PMs.
-A bond crisis will eventually erupt. Bonds are much easier to buy than they are to sell. ETF TBT will provide great rewards when the time comes.
-Equities will eventually blow up. ETF VXX will provide great rewards when the time comes.
-Ebola may be the unseen black swan event as could European Union failure, time will tell.
-A sudden rise in PMs could trigger a delivery failure at COMEX creating an exponential panic. ETF USLV will provide great rewards if this occurs.
-Continued use of economic sanctions are nothing short of economic warfare. A sudden increase in military or economic warfare is a game changer.
Metals could be near a bottom, but for now odds are greater that they will move lower. I'm building cash with periodic buys on silver where I find a low premium, usually an ebay purchase that offers a bonus ebay buck rebate. Just purchased two more tubes with the earned rebates.
We are in the midst of an economic minefield where a well executed PR program has kept most investors off their feet. Those without any PM patience should have already found the exit door. I'll continue to play the wait game.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
-Equities will eventually blow up. ETF VXX will provide great rewards when the time comes.
-Ebola may be the unseen black swan event, time will tell. ETF USLV will provide great rewards if this occurs.
Do you think that the ETFs might have a general force majeure default, for any reason? That might concern me if I were trading them when a significant black swan event made an overnight appearance. The people I read note that when the exit closes, it will be too late.
I knew it would happen.
<< <i>-A bond crisis will eventually erupt. Bonds are much easier to buy than they are to sell. ETF TBT will provide great rewards when the time comes.
-Equities will eventually blow up. ETF VXX will provide great rewards when the time comes.
-Ebola may be the unseen black swan event, time will tell. ETF USLV will provide great rewards if this occurs.
Do you think that the ETFs might have a general force majeure default, for any reason? That might concern me if I were trading them when a significant black swan event made an overnight appearance. The people I read note that when the exit closes, it will be too late. >>
Why an ETF can't collapse
One man's opinion (as is most everything). Also note that ETFs are backed by the stability of the Fund that issues them. I personally believe that the threat of ETF failure is closely aligned with the failure of all paper promises - something that will most likely be preceded by amply warning to those paying attention.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Nassim Taleb doesn't like complexity so much. Complex systems are more fragile. We have a lot of complex systems that are interdependent already. Cascading events happen fast now. I don't know the real answers, just observing.
I knew it would happen.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>Bumper crop prices drop~ cheap corn is great for all.
Unless you are a farmer or an ethanol producer.
RIP Mom- 1932-2012
To those worried about deflation, the current prediction for GDP grow would wide is over 3% for next year. That would not suggest deflation. The Fed is trying to keep unemployment low and inflation below 2%, and cares not about the S&P. Central bankers see the world in a different light as their mandate is one that is different from what investors want to see. They understand economies at a different level than most. How many of us have dinner every night with a Nobel laureate in economics?
Not according to Ben Bernanke. A fed chief he went so far as to say that he wanted to drive investors/savers away from short term instruments into riskier assets.
Too many positive BST transactions with too many members to list.
<< <i>Text
Not according to Ben Bernanke. A fed chief he went so far as to say that he wanted to drive investors/savers away from short term instruments into riskier assets. >>
Link does not work/open!
<< <i>To go back to the scenario where the guy sold his house in the early 70s for 20K. If he put it in the S&P he would have a big pile of money. There were not ETFs following the S&P at that time, but you could still have put it in a diversified portfolio. Compounding over 44 years does wonders. The thing is, you have to be in for the long run, not trying to trade to hit the top or bottom, depending upon your strategy.
To those worried about deflation, the current prediction for GDP grow would wide is over 3% for next year. That would not suggest deflation. The Fed is trying to keep unemployment low and inflation below 2%, and cares not about the S&P. Central bankers see the world in a different light as their mandate is one that is different from what investors want to see. They understand economies at a different level than most. How many of us have dinner every night with a Nobel laureate in economics? >>
I agree with you.
I give away money. I collect money.
I don’t love money . I do love the Lord God.
Saudis beginning what appears to be a price war with oil, bad for PMs.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey