The Investment Thread (stocks, bonds, real estate, retirement, just not gold)

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BMBiology said:
Only if salary increases 3-4% a year instead of 2%. That is when I know the recovery has finally benefited the employees.
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Mine did. :) And with the restructuring of DOP responsibilities and compensation, the DOP pay in the system went up 3-12% depending on changes and performance.
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I'm surprised anyone puts any stock in these fake employment #'s. They are highly manipulated. Particularly around election time. Just take a look at the questions they ask and how they come about these #'s. It's a joke.
 
Doesn't take a genius to know... more jobs = more income = people can afford housing/spend more. Spend more = business/stocks go up. As long as unemployment is low, spending will be strong.

StartsUnemployDec2013.jpg
 
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Momus said:
Doesn't take a genius to know... more jobs = more income = people can afford housing/spend more. Spend more = business/stocks go up. As long as unemployment is low, spending will be strong.

StartsUnemployDec2013.jpg
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This would be nice if it wasn't for the fact that hedgefunds like Blackrock, billionaires like Buffett and laundered foreign money have been buying these homes and renting them to the Americans who can no longer afford or qualify to own. Renting is the new ownership here. Also "housing starts" means nothing. This is despite record low interest rates for a long time. Stocks tend to go up when you have company buybacks, wage stagnation, and layoffs. The record amount of student loan debt will not allow the real estate market to come back for some time. Low wage part time Obamacare jobs don't help.
 
What if interest rates rise?

This is the average interest rate we now pay on US Treasury debt: 2.402%

And a lot of this is short term paper. For FY 2014 63 Trillion was redeemed. All those cash management bills, 1 mo, 3 mo, 6 mo paper getting rolled over and over.

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In 2006 the avg interest rate on US debt was 5.02%.
In 2001...6.06%

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Deleveraging, What Deleveraging? The 16th Geneva Report on the World Economy

http://www.voxeu.org/article/geneva-report-global-deleveraging

global-debt-to-GDP.png
 
Stock market is down again. Who is planning to buy if it drops further?
 
How much cash are you sitting on?
 
BMBiology said:
Stock market is down again. Who is planning to buy if it drops further?
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Buying every 2 weeks... doesn't matter up or down, $1750 every pay check... sometimes even more until I am in distribution phase;-D Short term crash is good.
 
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So, I splurged a little for retirement today. Still have $33k cash left to invest. Hope for more downside to come in October.

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Where was the Exchange Stabilization Fund today? Wow, the market gave up all of yesterday post Fed minutes gains and then some. And closed at the bottom of the candlestick. Here it is, the deflation scare. The moment of truth will be what happens at the Fed's response. It tipped it's hand yesterday. A strong dollar will not be tolerated. A strong dollar is poison to an overleveraged system. Oct 29 is next Fed meeting. What if Janet turns uber dovish with a implicit guarantee the Fed will not allow the market to drop. Will the market go up as before? Or what if it continues downward?

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WINTER IS COMING...KONDRATIEFF WINTER
 
I was at a breakfast CE this morning focused on emerging therapies in multiple sclerosis. The audience of around 50 folks was largely half-asleep or glued to their cellphones; they weren't paying too much attention to the presentation.

At the close of the presentation, the moderator asked if there were any questions. Nobody raised their hands or moved toward the microphone, and the moderator was about ready to dismiss the audience. At that point, a thirtysomething woman stood up and strode confidently to the microphone and unleashed this: "We aren't going to be able to pay for these products. The United States [voice rising] IS SEVENTEEN BILLION DOLLARS IN DEBT. OUR TRADING PARTNERS ARE HOARDING GOLD SO THEY CAN EXCHANGE IT AMONGST THEMSELVES AND CUT US OUT OF THE EQUATION! [denouement] Our currency is going to lose its value. We are in real trouble." And with that, she spun on her heels and marched back to her seat.

The audience (myself included) didn't quite know what to do- we did not expect this at 7:45 in the morning. After a few moments, the moderator simply said "I appreciate your willingness to comment. Thank you.", and the meeting was adjourned quickly thereafter.

I'm posting this because I'm legitimately curious: what has happened in the last 7-10 days that has led all of the doom and gloomers (the rational ones and the tin hats alike) to believe that a financial cataclysm is right around the corner? While I am no financial guru, I do keep track of economic news, and I'm feeling rather good right now.
 
Sept 25th was the 1st of Tishri. It kicked off the Year of Shmita or Shemitah. Every 7th year is a Sabbath year for the land to rest and all debts are to be wiped away. 2008, 2001, 1994(Tequila Crisis), 1987, 1980, 1973, 1967... it's pretty amazing.

What happened the last few days? Economic data from across the globe is in toilet. Trillions in debt have to be rolled over with the aid of a printing press. No matter how hard the central banks try to inflate it's not working. The Japanese realize that weakening the Yen is not working. To get up to speed first all stop watching CNBC and Bloomberg. The WSJ, Barrons, and all the rest are not reporting what the rest of the world is doing to prepare a new multipolar reserve currency system in which the dollar will share a role. The USD will not implode , but it will be revalued downward in relation to surplus nations.

http://www.salientpartners.com/epsilontheory/

http://thebricspost.com/

https://www.youtube.com/user/GordonTLong/videos

http://conscience-sociale.blogspot.com/

http://www.leap2020.eu/GEAB-N-80-is...nce-2014-the-big-American-retreat_a15224.html








There is debate as to whether what we face is a transition to a multilateral reserve system based on the IMF's SDR (Special Drawing Right) or the BRICS bloc will institute a system which requires a certain kind of collateral to be posted for participation. A pro-SDR website is http://philosophyofmetrics.com/2014/01/21/sdrs-and-the-new-bretton-woods-part-one/

If you want the other view then
 
Is anybody here also OK with the market crashing? of course it would suck for the babyboomers. It is bound to happen. I dont know if it will happen soon but I think I am prepared for it.
 
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297point1 said:
At the close of the presentation, the moderator asked if there were any questions. Nobody raised their hands or moved toward the microphone, and the moderator was about ready to dismiss the audience. At that point, a thirtysomething woman stood up and strode confidently to the microphone and unleashed this: "We aren't going to be able to pay for these products. The United States [voice rising] IS SEVENTEEN BILLION DOLLARS IN DEBT. OUR TRADING PARTNERS ARE HOARDING GOLD SO THEY CAN EXCHANGE IT AMONGST THEMSELVES AND CUT US OUT OF THE EQUATION! [denouement] Our currency is going to lose its value. We are in real trouble." And with that, she spun on her heels and marched back to her seat.
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You are either a troll or that woman is ******ed.
 
You caught me, man...I've been laying in the weeds and playing the long game. After 5+ years and 600+ posts, I decided to reveal my true intentions and start trolling, and you caught me on my very first attempt.

Give me a flipping break.
 
Stock market is down again! I think there will be at least another week of this. I have ca$h in my hands...just waiting.
 
BMBiology said:
Stock market is down again! I think there will be at least another week of this. I have ca$h in my hands...just waiting.
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I pulled $50k into a fixed fund 3 weeks ago, but my biweekly contributions still go into an S&P Index fund.

Still debating what correction level will trigger me to reinvest.
 
Is a million bucks enough to retire assuming that person has no other big liabilities i.e no mortgage (house paid off)?
 
If it reaches 16,300 the next resistance level (likely), I am adding another $15k. Buy and hold forever :-D
 
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There is such a thing as a secular bear market. I guess every generation has to learn.

3-2-Shiller-6.29.12.png
 
Notice the left part of this graph is always lower than the very right of the graph. New highs always there after recession. You are always making money if you don't sell. After all businesses are there to make money. Capitalism works. If they don't make profit, you should not even be employed/have a job (duh).
 
But look at the time scale. About 17 years for a secular bear. About 30 years from peak to peak. From the viewpoint of an intergenerational endowment such periods can be taken in stride. But an individual? An adult working career is only about 40 years. A good portion of one's total lifetime income is backloaded and for most the early working years are very tough in which to save. So there's a window of maybe 20 years in which one really accumulates a nest egg. It's very important to know where you are in the big cycle during the accumulation phase and the 20-30 years of distribution ( retirement).

A lot of retirees at the end of the 60's thought they were set with most of their nest egg in "safe" bond portfolios. By the end of the 70's they were ruined. Rising interest rates. You know those target retirement funds that adjust your stock/bond allocation as you approach retirement based on the assumption bonds are safe? These were designed by BTFD E-trade babies who have never seen a secular bear market in bonds. The professionals who did have died or retired.

And this isn't capitalism, it's creditism. We are actually very communistic. The student loan bubble is a prime example.

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W19 said:
Is a million bucks enough to retire assuming that person has no other big liabilities i.e no mortgage (house paid off)?
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Depends. Mostly on how much you need every month, but don't forget the time component.

$1M today? Or $1M in 30 years. Big difference with inflation and buying power.
 
confettiflyer said:
Depends. Mostly on how much you need every month, but don't forget the time component.

$1M today? Or $1M in 30 years. Big difference with inflation and buying power.
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I was talking about now... I thought about it and I don't think it will be enough.... One might need 2 million so you can get at least 100k with 5% return on investment... I guess I will have to work for 15 years after med school ;).
 
W19 said:
I was talking about now... I thought about it and I don't think it will be enough.... One might need 2 million so you can get at least 100k with 5% return on investment... I guess I will have to work for 15 years after med school ;).
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Haha, well it depends on what you need money for. There actually is a thing called over-saving, but if you've retired all of your debts and your recurring living expenses are pretty standard (property taxes, maintenance, utilities, food, healthcare, etc...), you have to ask the question how much do you realistically need?

Don't forget social security in the mix, though part of me wouldn't rely on current numbers/valuations that retirees are getting. I project 50% of the theoretical max at age 70 (~$1700/mo in current dollars), but it's kind of an academic exercise at this point.
 
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confettiflyer said:
Haha, well it depends on what you need money for. There actually is a thing called over-saving, but if you've retired all of your debts and your recurring living expenses are pretty standard (property taxes, maintenance, utilities, food, healthcare, etc...), you have to ask the question how much do you realistically need?

Don't forget social security in the mix, though part of me wouldn't rely on current numbers/valuations that retirees are getting. I project 50% of the theoretical max at age 70 (~$1700/mo in current dollars), but it's kind of an academic exercise at this point.
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I don't need a lot of stuff except a fancy car in the range of 50k-60k... All my debt will be discharged... I am a nontrad student and by the time I am done with med school, I will outright own my home (No mortgage)... The only debt I will have is student loan... I guess another way I can do that is to try to save 1 million in 10 years, then work 2 days/week thereafter since we as physician/pharmacist can make 60-80k/year working part time. I just don't want to work like a dog in my 60s...
 
confettiflyer said:
I pulled $50k into a fixed fund 3 weeks ago, but my biweekly contributions still go into an S&P Index fund.

Still debating what correction level will trigger me to reinvest.
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My munis holding is around 10%, I am trying not to put money into bond fund right now. Not that I need to... since my equity holding is dropping a bit, my bond holding % is going up and the money I put into equity rebalances my portfolio back to asset allocation.

Economy is getting better and fed's plan on raising interest rate. Directly, bond will be the first one to drop in value. Indirectly, stocks will tend to go down also due to lower consumer spending and raising businesses borrowing expenses.
 
I can't wait to reread this thread 20 years from now!
 
Something big is on the way.


http://www.ft.com/intl/cms/s/0/923f...ks/rss/home_asia/feed//product&siteedition=uk

"October 11, 2014 10:20 pm

Banks agree to derivatives rules to cope with future crisis
By Philip Stafford in London and Tracy Alloway in New York©Reuters
The world's largest banks have agreed togive up their rights to immediately end derivatives contracts with crisis-hit rivalsafter global regulators pressed for an industry cross-border agreement to stop counterparties terminating deals with troubled institutions.

Regulators have been concerned that demands from around the world to settle deals could accelerate a bank's demise and destabilise the financial system: a fate that befell Lehman Brothers and which lawyers have spent years untangling.
  • According to the International Swaps and Derivatives Association, a trade group that brokered months of negotiations between regulators and 18 global banks, the deal that was formalised on Saturday will cover more than 90 per cent of the over-the-counter derivatives market, which has a notional outstanding value of $710tn.

The protocol will place a brief to halt rights within Isda's standard contracts, the legal paperwork that underpins most swaps trading. Many national regulators, including in the US and Europe, have already created domestic legal halts but most do not apply to cross-border trades.

Scott O'Malia, chief executive of Isda, said the agreement was "a key development" in helping the over-the-counter derivatives market.

Others were more sceptical about the impact of the Isda-led reform efforts and how the changes to derivatives contracts would work in practice. Many fund managers are concerned that those choosing not to amend their contracts could enjoy significant advantage over other market participants.

"You could try to fix that through regulation or legislation, but then you’re sure to have protests about violating the ‘sanctity of contract’. But even more importantly, the type of amendment that’s being discussed doesn't seem to really fix the practical problems that arose in Lehman," said Anne Beaumont, a partner at law firm Friedman Kaplan Seiler & Adelman LLP.

Mr O'Malia recognised many institutional investors had a fiduciary duty to end their contracts if a counterparty was in default. "I'm very sympathetic to their concerns and responsibilities. We have to make sure this works for everyone. There is a lot of education that needs to be done. This is about safety and soundness and ending 'Too Big To Fail’."

Ms Beaumont said there was also the thorny issue of the US bankruptcy code, which still provides a safe harbour exemption for termination of derivatives contracts.

National regulators have also committed to implementing new regulations that will include the halt, Isda said. Some US politicians, notably Democratic Senator Elizabeth Warren, have discussed amending the code but there appears to be little appetite in Washington to tackle the complex legal framework for US bankruptcies.

"They're effectively trying to do away with or suspend the safe harbour through contract because Congress isn't going to do anything to change the bankruptcy code in the near term," Ms Beaumont said.

The banks will adopt the protocol before the meeting of G20 economies in Brisbane, Australia next month and it will become effective on January 1, 2015, except for the US bankruptcy related provisions, which only become effective when the new domestic rules come into effect.

The banks that have agreed to implement the protocol are: Bank of America Merrill Lynch; Bank of Tokyo-Mitsubishi UFJ; Barclays; BNP Paribas; Citigroup; Crédit Agricole; Credit Suisse; Deutsche Bank; Goldman Sachs; HSBC; JPMorgan Chase; Mizuho Financial Group; Morgan Stanley; Nomura; Royal Bank of Scotland; Société Générale; Sumitomo Mitsui Financial Group; and UBS."

I wonder if this has anything to do the above?

 
Oh God the futures everywhere are red. Asia, Europe, US.

 
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Thank god for that "ignore" button. Brilliant.

Vatic -> Ignore - all spam is gone wow... can't see his posts LOL. Do yourself a favor before you get banned the 2nd time, open a tumblr account and stop posting useless crap.
 
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^^ hey there is a gold thread! Use it to post your crap.

Gold shall not be discussed in this thread <see thread title>
 
People want to think they're special and know things other people don't...human nature, no one's exempt, even me.
 
Didn't want to make another thread cause topic is kinda....related but what are people's thoughts on Gnucash? anyone here use it and if so, can it export to excel? seems like a tool someone on these forums would use with all the talk on money. or is there a better way to do personal accounting?
 
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Meanwhile there is one sector that stood tall amidst the chaos. Upon the launch pad it sits inversely correlated to all other assets.

saturn_v_n.jpg
 
Damn it, I had to drive 2 hours to work overtime and missed the dip at 1 pm; good entry point to buy in trenches -.- Hope it drops again tomorrow lol.
 
The stock market still looks too expensive. A stock market inflated by QE will die by QE. I'll be a buyer when market corrects to true value...which is roughly around 10,000. I am expecting a correction 30% or more. Sure it might bounce back to 17k but next stop would be 10k likely .
 
S&P is down 1.65% today. Who else is ready to buy?
 
I decided to start the buying process at about the 10% correction mark at $2000/week and double to $4000/week if it hits 15%, doubled to $8000/week at 20% down off peak...until the $50k pulled is exhausted.

My biweekly 403b deduction will continue going into my S&P 500 fund untouched, though.
 
^^ sounds like a technique a gambler would use!
 
BMBiology said:
^^ sounds like a technique a gambler would use!
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Lol, what? That's the complete opposite of what I'm trying to do! Dollar cost averaging, yo.

Going all in at a 2% dip is gambling!
 
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