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  1. #31
    IncGamers Member jmervyn's Avatar
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    Re: stock market chat 2013

    Quote Originally Posted by Stevinator View Post
    can't you reallocate to cash? or the "stable" fund? or whatever they call it? you don't have to withdraw, just shuffle it around.
    Guess which fund is pretty much exclusively U.S. Treasury bonds? No cash allowed.
    Quote Originally Posted by Stevinator View Post
    i still say it's too hard to figure out when it's best to jump in and out, so sit on companies that aren't going anywhere, and make sure you reallocate every so often.
    Thing is, I'd probably make some money swapping out the shares of the "International" for one of the others, but I don't know if it would actually profit me anything. Since it's compounding, and what the compounding buys is more shares, it's almost worth it to keep throwing the good after bad because I'm buying lots of what is nearly junk that should jump quite high once the Eurozone finally decides that it's fecked and Germany recovers from its Grecian nightmare.

  2. #32
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    Re: stock market chat 2013

    On gas prices: long term, gas prices hit a major bottom in 1999. They've been on the rise since, with oil companies like XOM being among the best stocks to own since 99. the primary driver has been the weak dollar which began in 2000. All commodities entered a bull market in 2000 when the government adopted a weak dollar policy under Clinton. We can define weak dollar policy as interest rates being below the inflation rate. Inflation runs at around 2% while 1 year tbills pay pretty much zero. As long as this situation persists, oil and all commodities are in a bull market. short term there is risk as the us ecnomy is stronger than europe and other areas, causing flight-to-safety from euros to dollars which is helping stabilize the dollar despite weak dollar policy. If europe can return to growth i expect oil prices to climb much higher but the truth is despite the recent rally in oil prices, they have been stuck in neutral over the past year plus as has the dollar.

  3. #33
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    Re: stock market chat 2013

    The gold, silver, oil and general commodities bull will run until the government pays an honest interest rate - when the interest rate is set clearly higher than the inflation rate. I cannot tell you when that will occur as that is a matter of government policy beholden to the whims of politicans. When it DOES happen, it will signal the start of a true economic recovery and commodities will enter a bear market at that time. Negative interest rates tells us the economy is sick. We can cut through the lies politicans tell by looking at real interest rates to tells us what is going on. Negative interest rates tell me the US is still in a recession and has been for 12 years. its a "stimulated" economy that eeks out meager growth by making the dollar lose value. If we had positive interest rates right now, the economy would contract.

  4. #34
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    Re: stock market chat 2013

    The true difference between the 70s and today are where the numbers are. In the 70s interest rates were 8% but inflation ran over 10%. Today interest rates are zero but inflation is 2%. In both cases, real interest rates were negative, the economy sucked, and commodities were in a bull market. its just incorrect to say we suffer from high inflation, its better to say we have an inflation problem. In the 80s and 90s real interest rates were positive as the economy boomed.

  5. #35
    IncGamers Member Stevinator's Avatar
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    Re: stock market chat 2013

    Quote Originally Posted by jmervyn View Post
    Guess which fund is pretty much exclusively U.S. Treasury bonds? No cash allowed.
    Thing is, I'd probably make some money swapping out the shares of the "International" for one of the others, but I don't know if it would actually profit me anything. Since it's compounding, and what the compounding buys is more shares, it's almost worth it to keep throwing the good after bad because I'm buying lots of what is nearly junk that should jump quite high once the Eurozone finally decides that it's fecked and Germany recovers from its Grecian nightmare.
    huh?


    The fund that's all treasuries is basically sitting out of the market. if you think US equities are going to take a hit, moving to the treasury fund until after the drop is how you'd play that. I think you're confusing yourself on the government's confusing language. treat eh thrift plan just like an IRA, but where you don't have many choices. Each choice think of it like a mutual fund (it kind of is, they just call it stupid stuff because it's the government).

    It's actually not just the government, it seems like everyone wants to use their own dumb terminology. in the end if it's a pile of money invested in large domestic equities, then it doesn't REALLY matter what you call it for allocation purposes.


    so say you look like this (a pretty run of the mill mix in a 401k type plan):

    10% international (I hate that term, I always wonder, international what? they should have more options than one international fund)
    25% Large US Growth
    25% Large US Value
    10% small US
    10% medium US
    20% bonds ( corp investment grade)
    0% Junk bonds
    0% stable

    then you get worried about US stocks, you could just move out of the market temporarily.

    80% stable
    20% corp bonds
    and then put it back after the drop, and you'd be coming in at a lower share price, which would mean buying more shares. the fact the government calls dividends from their funds compounding (or some other grossly misused term), doesn't mean it works like interest. they're just overly dumbing things down for people that never did more than put money in a bank. Since you're not dumb, you see that and think they wouldn't call it something it's not. but they would. It really is as simple as there are only two ways you make money from each fund. either the share price goes up, or it produces a dividend, which is reinvested in more shares. all that crap about "compounding" is there for people who are dumber than you. all they're trying to convey is that over time the balance will go up.


    Fizoo~
    So what you're saying is i need to buy a car and quit driving around the suburban. groan.

  6. #36
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    Re: stock market chat 2013

    Im saying the top of the oil bull market is unknowable. It could occur tomorrow if the government hiked interest rates to 5%. Cant tell you what the silly politicans will do. All i know is it will come when real interest rates turn positive.

  7. #37

    Re: stock market chat 2013

    Quote Originally Posted by jmervyn View Post
    America has at least three "corrections" in store: a 'student loan' crash, the eventual repercussions of our failure to fix our housing market, and the effect of what THE WON has done to our economy.
    I'm counting four, myself:

    1) Student Loan Bubble
    2) Re-Inflating Housing Bubble
    3) Equity Bubble
    4) Treasury Bubble

    #4 is going to be a *****. All those people/retirement funds that bought "safe" US treasuries are going to get blowtorched when interest rates spike.

  8. #38
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    Re: stock market chat 2013

    My concern is the china housing bubble. When that goes, itll send the whole globe into another recession. Itll slow the output of goods from china, creating scarcity in many sectors and higher prices. Everyone will rein in their horns around the world. Consumers will cut spending. I imagine a fresh round of stimulus will be what the politicians prescribe. How big does the annual deficit get? 5 trillion? 10? Maybe the world decides to try to bail out China too. 50 trillion deficits?

  9. #39
    IncGamers Member jmervyn's Avatar
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    Re: stock market chat 2013

    Quote Originally Posted by Fizoo View Post
    As long as this situation persists, oil and all commodities are in a bull market. short term there is risk as the us ecnomy is stronger than europe and other areas, causing flight-to-safety from euros to dollars which is helping stabilize the dollar despite weak dollar policy.
    This is where I stuck my foot in the bear trap. I thought people would flee the dollar because of policy, not realizing that they would flee the euro even faster.
    Quote Originally Posted by Fizoo View Post
    If europe can return to growth i expect oil prices to climb much higher but the truth is despite the recent rally in oil prices, they have been stuck in neutral over the past year plus as has the dollar.
    Won't just be oil. Plus, it's happening already despite the potential for American and Canadian "fracking" which has basically invalidated all the 'peak oil' claims. This is because of Obama's policy, rather than legitimate issues - Obama (and the Left anti-Bush crowd previously) anticipate a 10-year-plus lead time on development of new resources, where true 'oil men' discuss the reality as being under 2 year development. Plus putting the refineries out of business means an even harder path towards the market.
    Quote Originally Posted by Fizoo View Post
    I cannot tell you when that will occur as that is a matter of government policy beholden to the whims of politicans.
    Heh. Try "post-collapse". I still am amazed at the way all of this was modelled for us by Argentina over a decade ago, yet we're still following course.
    Quote Originally Posted by Stevinator View Post
    if you think US equities are going to take a hit, moving to the treasury fund until after the drop is how you'd play that.
    Correct, except that I missed my chance and held the Common and General stocks during the crash - I don't blame Obama for that loss; I wasn't paying attention as I should have been.
    Quote Originally Posted by Stevinator View Post
    Each choice think of it like a mutual fund (it kind of is, they just call it stupid stuff because it's the government).
    There's a disclaimer buried somewhere where they discuss that each of these is really very much a mirror of a well-known 'tracking' fund (Morgan Stanley). Funny thing is, when they discuss the way that automated systems can cause wild fluctuation (and the supposed instant terrorism trashing of the markets), they don't really think about this sort of fund...
    Quote Originally Posted by Stevinator View Post
    then you get worried about US stocks, you could just move out of the market temporarily.
    I could probably sub-divide the way you describe, but we're penalized for frequent moves.
    Quote Originally Posted by Stevinator View Post
    and then put it back after the drop, and you'd be coming in at a lower share price, which would mean buying more shares.
    That's what I'm attempting to do, except that I missed the boat initially. So I'm keeping my investment in the "International", and putting in the minimum that gets matched (6% of salary), with hopes of eventually transferring those after another crash - thing is, do I unload from the weaker "I" fund and take the hit, or do I keep buying shares knowing that these are actually companies like Coke, Pepsi, Nestle, Siemens, IBM, Shell, and similar.
    Quote Originally Posted by Stevinator View Post
    It really is as simple as there are only two ways you make money from each fund. either the share price goes up, or it produces a dividend, which is reinvested in more shares.
    True. Essentially, I'm gambling with both my fund-matching and my 'compounding' on the share quantities of the pseudo-International companies invested. That honestly may not be a wise gamble, given my belief in a forthcoming economic meltdown, but I kind of still believe it's going to hit the U.S. harder since we're still not paying the piper for Bernanke's running the printing press like an organ grinder monkey. Again, I don't know if it's wise. If Pepsi-America troughs because the U.S. craters, Pepsi-International will still survive, and my shares would be in the International part of the company. For the immediate future, however, I have to deal with the effect of Germany trying to rescue the PIIGS.

    ************************************************** *********************************

    EDIT -
    Quote Originally Posted by SaroDarksbane View Post
    #4 is going to be a *****. All those people/retirement funds that bought "safe" US treasuries are going to get blowtorched when interest rates spike.
    You put it more succinctly than I, but that's why I don't put my "401K" in the "safe" Treasuries like everyone else. I'm probably being too risk-adverse; the proper solution would be to put them in Treasuries, ride the wave, and then unload before the crest. I'm not that good, as I said, and the TSP system has been deliberately retarded because of people gaming it.

  10. #40
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    Re: stock market chat 2013

    The dirty little secret is that were all gambling no matter what we do. The value of the dollar is a gamble. You could invest completely in that and it could lose most of its value in a fairly short amount of time because its not backed by anything. You could point out its never happened...which is exactly the same defense people used to argue housing was not in a bubble a few years ago. In the end, it comes down to being smart with your money.

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