Stock Market

[morasp]

stock market back to November of 2016

 

[CATCH17]

What do you type of effect do you think these stimulus packages will have on the market?

Are they just throwing money away?

Will it stabilize?

 

[morasp]

What do you type of effect do you think these stimulus packages will have on the market?

Are they just throwing money away?

Will it stabilize?

It's always hard to say how the market will react. I would guess the best news they could get is that there is an effective vaccination.

 

[YosemiteSam]

What do you type of effect do you think these stimulus packages will have on the market?

Are they just throwing money away?

Will it stabilize?

Fastest way to lose money is to speculate. That question can only be answered with speculation at this point. @morasp is right. An effective vaccination and / or recoveries out-pacing new infections will likely have the biggest impact on the market. Until one of those two things happen. The bottom will likely remain an unknown.

On the plus side, the Dow was only down 582 points today!

 

[YosemiteSam]

Oh to your question about throwing money away.

No, it's not throwing money away. The liquidity helps, but think about it like this.

You have a barrel that is buried under ground and you're trying to fill that barrel up with jelly beans at his request. Now, the jelly beans cost you $1 a piece and you don't actually know how big the barrel is because it's buried under ground.

How many jelly beans (dollars) does it take to fill it up and at what point do you go broke throwing jelly beans into the barrel? You probably heard that the fed is going to be unlimited in what they can do to protect the market, but that is just hyperbole. They cannot do that. They are just trying to stabilize the hysteria (emotion) investors are currently having that is causing this massive selloff. Given the situation, (black swan, perfect storm, whatever you want to call it) the hysteria is right.

I would recommend you detach from the market right now. It is not a safe place and I want to repeat this again. You DO NOT need to be at the very bottom of this market sell off to make money long term. Nobody can guess the top or the bottom of these.

If you're watching the market everyday, you likely will end up poor because emotion, taxes, and fees will destroy any investment upside.

The proof is in the pudding. The say index funds are the market average. This is true because it's an index fund which usually average a bunch of stocks, but that isn't even remotely true when you're talking about investors. Less than 5% of investors actually end up beating index funds each year after all the taxes, and fees. (those that do are usualy long term investors!) Especially for those that buy and sell throughout the year. When you're constantly buying and selling, you fee and tax yourself to hell and back. If you're not watching the market, you're not buying and selling!

Wait till the market settles down. Right now, I would just be looking for good investments, but not in any hurry to buy.

 

[YosemiteSam]

Current CNBC news headline: Market comeback gains steam as Dow soars 1,500 points on stimulus deal hope

It's the media putting out this type of attack on people's emotional state why people lose so much money in the market. I always tell people, speculation is how you lose money in the market. That headlines clearly says "stimulus bill hope". If you're investing based on "hope", I thank you for lining my pockets with your money.

The stimulus bill will help, but it won't *fix* the market. The above is clickbait and a trick to get you back into the market early.

This is why I always tell people not to watch TV news. Read only about the facts and void sites / stations / articles and ALL media talking heads as they are all bias. Make your own decisions, because everyone else wants you to make decisions that support their cause. Not yours.

All (and I mean ALL) the great investors will tell you. Most all media is noise and not only doesn't help you as an investor. It there to hurt you and make them money!

 

[Reality]

Dow surges 11% for its best day since 1933 as $2 trillion coronavirus aid package nears approval
https://markets.businessinsider.com...irus-bill-economic-stimulus-2020-3-1029028514

The Dow Jones industrial average surged 11.4%, or 2,113 points. That marked its biggest point gain ever, as well as its largest percentage increase since 1933.

 

[morasp]

The S&P 500 index advanced to the 200 week moving average which showed resistance and moved back down. During large sell-offs the major moving averages form support and resistance points for price levels. On the daily chart the S&P rose above the 14 day moving average and settled near that level. The level is still well below the 200 day simple moving average which has turned downwards.

 

[morasp]

The overall stock market is still in a sell condition. Just like last week the S&P 500 index advanced to the 200 week moving average which showed resistance and moved back down to a lower level than the previous week. On the daily chart the S&P is consolidating just above the 14 day moving average. The level is still well below the 200 day simple moving average which is still pointing downwards.

 

[Bigdog]

Ive noticed that even my very conservative investments including bonds have taken a big hit. Maybe he did make your kids investments “more conservative”, but nowadays even that hasn’t helped the money losses much.

I finally got a hold of him and told him about what my fund company said. He was in total shock and told me that he switched the funds over to a more conservative funds on February 7th because he knew that it was getting close for me to use them and didn’t want me to lose money even before this epidemic. He called the fund company and then got back to me. He told me that the fund company is going back to that date and checking it’s recordings and notes. They are going to switch to that date. My financial advisor even quoted me how much money I had that day in the accounts (which was true) so I know that he did it. Just goes to show it is best to be on top of things like this.

 

[YosemiteSam]

The overall stock market is still in a sell condition. Just like last week the S&P 500 index advanced to the 200 week moving average which showed resistance and moved back down to a lower level than the previous week. On the daily chart the S&P is consolidating just above the 14 day moving average. The level is still well below the 200 day simple moving average which is still pointing downwards.

This is what I've done so far.

I feel that the market will start it's actual recovery about the time the virus starts to abate here in the US. I think we are close to that now. I think new infections are starting to level off and in some cases lower. (not true all around, but the stay at home is starting to have an impact on COVAD-19's spread)

With that in mind, I pushed my 401k and IRA back into (depending on what fund was available) Vanguard 500 index fund (401k), or the Fidelity Total Market Index Fund (IRA). I did this around March 25th, but I did that knowing that these investments still have well over 20 years. So any short term losses that could still happen. Will fade and will recover with time. Time is one thing those investments have a lot of.

I just recently dipped about 15% of my liquidity into an asset I highly favor right after it dropped another 11% due to recent 8-K filing about postponing the up coming dividend. (it was around 40% of it's 52 week high) The company has very strong fundamentals and strong FCF. Now, I will likely maintain the rest of my liquidity until I see a more dramatic improvement that shows me people will start going back to work and businesses start reopening.

I do want to put out that why we are now clearly in a recession. I think this will be even bigger and it will be an all out depression. While recessions can last months to a a little over a year. Depressions can last multiple years and investors should understand that. That means when the market does finally bottom out. Do not expect it to start rising like it was prior to current events. There will be a longer (and likely painful ie, highly volatile) recovery process than what the current administration is saying. That high volatility will produce big ups and downs and those who fear them will lose a lot of money in the process.

Be careful here. When you invest, I suggest you *mostly* ignore the technicals and really focus on the company's fundamentals. (if you're going assets instead of funds) They must be fundamentally sound so they can ride out this storm.

Betting (speculating) in this high volatility time can be profitable if you really know what you're doing, but if you're not a professional. It can strip you of your cash in a hurry.

Remember, professional traders are trained to attack amateur's ignorance and Brokerage houses use IBs (Introducing Broker which are basically people brokerages hire to train amateurs to trade) to coerce amateur investors into trading larger quantities and to trade often. This is why most retail (amateur) trading accounts go dominate within 30 to 90 days. They start losing and quit.

Also, stay away from anything you read that says 'How I turned $500 into $5,000 in one day!" I would stir clear of anything advertising "day trading" also. This is exactly what they (in the above) paragraph want you to do. Less than 20% of day traders actually make money because the deck is stacked against them. The people on the other side of those trades have deals with brokers and they see a lot more of the market than you do. Knowledge is power here and you likely don't have the same knowledge they do.

If you go in, do your homework and then go long. That is your best bet here.

 

[The Fonz]

This is what I've done so far.

I feel that the market will start it's actual recovery about the time the virus starts to abate here in the US. I think we are close to that now. I think new infections are starting to level off and in some cases lower. (not true all around, but the stay at home is starting to have an impact on COVAD-19's spread)

With that in mind, I pushed my 401k and IRA back into (depending on what fund was available) Vanguard 500 index fund (401k), or the Fidelity Total Market Index Fund (IRA). I did this around March 25th, but I did that knowing that these investments still have well over 20 years. So any short term losses that could still happen. Will fade and will recover with time. Time is one thing those investments have a lot of.

I just recently dipped about 15% of my liquidity into an asset I highly favor right after it dropped another 11% due to recent 8-K filing about postponing the up coming dividend. (it was around 40% of it's 52 week high) The company has very strong fundamentals and strong FCF. Now, I will likely maintain the rest of my liquidity until I see a more dramatic improvement that shows me people will start going back to work and businesses start reopening.

I do want to put out that why we are now clearly in a recession. I think this will be even bigger and it will be an all out depression. While recessions can last months to a a little over a year. Depressions can last multiple years and investors should understand that. That means when the market does finally bottom out. Do not expect it to start rising like it was prior to current events. There will be a longer (and likely painful ie, highly volatile) recovery process than what the current administration is saying. That high volatility will produce big ups and downs and those who fear them will lose a lot of money in the process.

Be careful here. When you invest, I suggest you *mostly* ignore the technicals and really focus on the company's fundamentals. (if you're going assets instead of funds) They must be fundamentally sound so they can ride out this storm.

Betting (speculating) in this high volatility time can be profitable if you really know what you're doing, but if you're not a professional. It can strip you of your cash in a hurry.

Remember, professional traders are trained to attack amateur's ignorance and Brokerage houses use IBs (Introducing Broker which are basically people brokerages hire to train amateurs to trade) to coerce amateur investors into trading larger quantities and to trade often. This is why most retail (amateur) trading accounts go dominate within 30 to 90 days. They start losing and quit.

Also, stay away from anything you read that says 'How I turned $500 into $5,000 in one day!" I would stir clear of anything advertising "day trading" also. This is exactly what they (in the above) paragraph want you to do. Less than 20% of day traders actually make money because the deck is stacked against them. The people on the other side of those trades have deals with brokers and they see a lot more of the market than you do. Knowledge is power here and you likely don't have the same knowledge they do.

If you go in, do your homework and then go long. That is your best bet here.

I think the recovery will start around the second week of May

 

[nightrain]

A year from now, it will all be like a bad dream.

 

[YosemiteSam]

A year from now, it will all be like a bad dream.

You're more confident that I!

There was already an economic slowdown in progress, it just hadn't hit (affected) the US yet as the US is always one of the last to see the affects. This COVAD-19 took the economic slowdown and turned it into the incredible hulk. Then, lets not even talk about the damage the oil war between Russia and Saudi Arabia.

Lets top it off with what will end up being probably $5-$8 trillion dollars of "freshly printed money" being pumped into the economy to combat this. When you print money, inflation gets angry. To stop inflation, you usually end up having to raise interest rates, or inflation continues to grow making the money you have less and less valuable. Of course you want lower rates so business / banks can borrow money during a recession to strengthen the economy.

Do you lower rates and let inflation eat us alive or do you raise rates prolonging the recession? You get this vicious circle without a way for the Fed to properly combat it.

There has already been a deep gash in the world's economy. That doesn't heal overnight. I sure hope you're right, but I'm not even remotely convinced. I'm going to go with my gut and plan for a protracted recession.

 

[morasp]

This is what I've done so far.

I feel that the market will start it's actual recovery about the time the virus starts to abate here in the US. I think we are close to that now. I think new infections are starting to level off and in some cases lower. (not true all around, but the stay at home is starting to have an impact on COVAD-19's spread)

With that in mind, I pushed my 401k and IRA back into (depending on what fund was available) Vanguard 500 index fund (401k), or the Fidelity Total Market Index Fund (IRA). I did this around March 25th, but I did that knowing that these investments still have well over 20 years. So any short term losses that could still happen. Will fade and will recover with time. Time is one thing those investments have a lot of.

I just recently dipped about 15% of my liquidity into an asset I highly favor right after it dropped another 11% due to recent 8-K filing about postponing the up coming dividend. (it was around 40% of it's 52 week high) The company has very strong fundamentals and strong FCF. Now, I will likely maintain the rest of my liquidity until I see a more dramatic improvement that shows me people will start going back to work and businesses start reopening

I do want to put out that why we are now clearly in a recession. I think this will be even bigger and it will be an all out depression. While recessions can last months to a a little over a year. Depressions can last multiple years and investors should understand that. That means when the market does finally bottom out. Do not expect it to start rising like it was prior to current events. There will be a longer (and likely painful ie, highly volatile) recovery process than what the current administration is saying. That high volatility will produce big ups and downs and those who fear them will lose a lot of money in the process.

Be careful here. When you invest, I suggest you *mostly* ignore the technicals and really focus on the company's fundamentals. (if you're going assets instead of funds) They must be fundamentally sound so they can ride out this storm.

Betting (speculating) in this high volatility time can be profitable if you really know what you're doing, but if you're not a professional. It can strip you of your cash in a hurry.

Remember, professional traders are trained to attack amateur's ignorance and Brokerage houses use IBs (Introducing Broker which are basically people brokerages hire to train amateurs to trade) to coerce amateur investors into trading larger quantities and to trade often. This is why most retail (amateur) trading accounts go dominate within 30 to 90 days. They start losing and quit.

Also, stay away from anything you read that says 'How I turned $500 into $5,000 in one day!" I would stir clear of anything advertising "day trading" also. This is exactly what they (in the above) paragraph want you to do. Less than 20% of day traders actually make money because the deck is stacked against them. The people on the other side of those trades have deals with brokers and they see a lot more of the market than you do. Knowledge is power here and you likely don't have the same knowledge they do.

If you go in, do your homework and then go long. That is your best bet here.

I don't disagree with you other than the technical indicators work too It would have a few more exits and entries per year than a buy and hold strategy but nowhere near a day trading situation and the returns are a lot higher.

 

[nightrain]

You're more confident that I!

There was already an economic slowdown in progress, it just hadn't hit (affected) the US yet as the US is always one of the last to see the affects. This COVAD-19 took the economic slowdown and turned it into the incredible hulk. Then, lets not even talk about the damage the oil war between Russia and Saudi Arabia.

Lets top it off with what will end up being probably $5-$8 trillion dollars of "freshly printed money" being pumped into the economy to combat this. When you print money, inflation gets angry. To stop inflation, you usually end up having to raise interest rates, or inflation continues to grow making the money you have less and less valuable. Of course you want lower rates so business / banks can borrow money during a recession to strengthen the economy.

Do you lower rates and let inflation eat us alive or do you raise rates prolonging the recession? You get this vicious circle without a way for the Fed to properly combat it.

There has already been a deep gash in the world's economy. That doesn't heal overnight. I sure hope you're right, but I'm not even remotely convinced. I'm going to go with my gut and plan for a protracted recession.

I think there will be some more pain through the summer, but once confidence returns to the economy it will pick up steam again. I don't expect the record shattering trajectory that was evident in the market though January, but I feel confident we will be back to a place we were at the end of 2019 a year from now.

Much of the "printed" funding is in the form of loans, so hopefully it will keep businesses afloat and they can pay it back. The world economy has been anemic for quite some time so I don't see any way for that to go but plateau or up. The energy industry is my biggest concern right now. If we are unable to get the economic engines across the globe firing again, it will be a difficult chasm to avoid.

I am hoping to take my summer vacation and fully expect the football season to kick off as planned. Cautious optimism is my way, wanting no part of the doom and gloom crowd.

What will really derail everything all together is a reappearance of the virus that will still has us baffled and scared.

 

[1LoyalCowboyFan]

Don’t time it. Listen to Freaconomics podcast called the stupidest thing you can do with your money. Index funds are the way for me. I’m very passive. People forget it’s a zero sum game.

yes, we are all in this together. I haven’t touched anything. Not even my emergency fund which is important for all to Have for times like this.

P/E Ratios seem to indicate market was overvalued. Usually only thing I look at for stocks.

anyways my 2 cents and rambles.

 

[YosemiteSam]

I don't disagree with you other than the technical indicators work too It would have a few more exits and entries per year than a buy and hold strategy but nowhere near a day trading situation and the returns are a lot higher.

No, I know exactly what you're saying. I'm generally a long term investor, though I've been known to hit an easy target if I see it happen. Though most of the time I'm too busy during trading hours with my job.

The think what I appreciate most about being long in my investments is the fact that I once I'm done my homework and made the investment. I only need to skim the news about those investments and read all of their sec filings. As long as I was right before the initial investment (which I'm pretty strict about) I'm usually good and can just cruise through any market / asset volatility without worry.