7,160.18 DOW. eom

It's what I'm living on.

I think they may have some words for you.

my friend worked for 30 years in an oil refinery and now has to go back to work after two years of retirement. Unfortunately she can't find work and she can't mentally take going back to the refinery. It sucks big time.

This is basic investing, people. Age 20-40, mostly risky investments, age 40-50 half and half, age 50-60 about 70-30 unless you retire in your fifties, then 90-10. 90% safe and 10% risk. One problem may be that mutual funds are considered safe in most situations, but they aren't in this market. These people shoulda been more prudent in their investing. I am sick of hearing about retirees who are losing money in a market they shouldn't have been playing.

from their bank? What investments haven't been risky other than cash? And cash hasn't been all that safe either with the banks going under. Is FDIC going to bail everyone out?

and let's not underestimate the APR please. My portfolio for december 2008 shows APRs of - 4.523, 2.967, 4.426, 4.087, 4.812, 5.053, 3.211, 4.909, and 5.053. When rates are higher, you lock in for longer terms. A 2-3% return may suck, but it's much, much, much better than a negative return. A retired person would be better off spending their principle instead of whizzing it away in the market. I think if the FDIC fails then we are pretty much all dead anyway.

Been playing High risk.

Basic investing, my fanny. You try to find any sort of 'non-risky' investment right now (other than the coffee can or your mattress.) Treasuries and bonds are not safe, either (look at the hit they took today with the news about Citi.) Sit in cash too long and you'll simply run out of money because no compounding is occurring, and you're in effect losing money at a faster rate because of inflation.

These people have to presume that they're going to live for 30 years after they retire. A 90/10 portfolio will NOT get that done, period. The majority of 'these people' you're referring to have already seen anything that looks like a 'three-legged stool' (pension, social security, private savings) almost vanish completely in just the last 15 years. How would you like to realize that the last leg has just been wiped out, right as you're getting ready to need it?

What's so troubling is that this market is hitting even the most disciplined investors, the folks who didn't take a flyer on the exotic derivatives, etc., but simply saved the maximum amount every year.

In my book, what you're doing is called blaming the victim.

investments (bonds) have been tricky. Treasuries are not giving any return now. There are no safe investments that one can comfortably live off.

~

DOWn by the river in a van! :)

Where I'll be staying ( Or what passes for one in AZ ) if those student loans don't show up soon!

I expect it to crash through 4000, which I think is its real value.

If the GOP continues to obstruct and if by some miracle they pick up seats in 2010, I fully expect it to go below 1000.

if the Stimulus was $900 billion instead of $800 billion?

Yours is no exception.

Or is that one of those "everything before but is bullshit" ideas.

I suspect as the year goes on and consumer confidence increases from it's record low we will see most stocks take an uptick.

The DOW is flawed obviously, but it's a decent enough indicator. Things are only going to get worse when AIG inevitably collapses.

The stimulus is 100% borrowed money. At best, it will have a "zero sum" effect.

There is no confidence because the Government hasn't been doing/is not doing anything to make investors more confident.

We were told TARP would restore confidence. In fact, it has hurt confidence. We'll get the same result with the stimulus.

We are not trying anything new. Japan has been down this road before.

We are in the snowball effect now, and we are only a third of the way down the hill.

if investors, brokers and companies weren't running around in a blind panic. And angry trolls don't help their mood.

I hope I'm right, because I'm beginning to wonder if I was too optimistic.

:thumbsup:

If I'm right, people will be lining up for lumberjack's investment advice. :D

I made the same predictions. :shrug:

... I guess I'm just predisposed to laugh at the predictions of others. :)

I said 6800. I was far too optimistic.

Like Warpy I would not be surprised to see 4000 levels.

6200 worst case that is. To me, it looks like real recovery will begin in 6 to 12 months. Of course, this estimate is pulled mostly from my asss.

I'll split the difference and place a buck on 5500. Dark Humor.



If you can't laugh at something, your dead. :)

...I just don't see anything coming down the pike in the next quarter that will be positive enough to alleviate the funk and negativity currently out there...

I had originally thought that we would start pulling out of this by 3rd or 4th q this year...I now think we're stuck like this until 1st 2nd q next year...and we will trade MUCH lower before we start to climb back up...

I hope so anyway !

when things look bad it seems true that they will always look bad. I hope we are witnessing capitulation. The amount sold yesterday sure indicates that possibility. If it has begun, look out below. But, I do have a feeling it will bottom around 6200.

Lots of stocks (includig energy) are trading at 4 to 1 p / e ratios for cryin out loud.

:thumbsup:

It is just recently reaching the levels of the 2001 recession. Stocks remained over priced then and a price correction was never realized.

So we still have inflated stock prices. Stock prices are really in one fashion or another some kind of discounted future cash flow based on nvestor expectations regarding the risk free rate, the risk premium, and the dividend and price appreciation of the stock. Risk premiums have skyrocketed. Earnings forecasts are highly speculative and widely varied based on assumptions held but not necessarily stated by the analyst. And consumer confidence is declining by the minute.

The stock market is going to get much uglier. Lots of folks are going to be badly hurt.

There are a lot of variables.

We have a consaumer economy which is based on credit. So consumer confidence has to improve as does consumer spending. That means further declines are likely until there is evidence of job creation, increases in broad consumer spending and confidence and projected corporate earnings and stock appreciation. All of those things may be at least a year or two down the pike.

That stimulus bill isn't going to immediately create jobs or increase consumer confidence and spending. Big business will not be able to create the jobs that have been lost until wealth is restored. That means that most of the job creation is going to come from small and new business. And there wasn't much in that stimulus package to encourage hiring or small business creation in the current economic environment.

Personally I do not expect to see solid signs of market recvery for at least a year and a half. And I would not be surprised to continue seeing a significant drop in market valuation during that time. We will likely see the Dow in the 6000s in the not too distant future. How much further will it drop? Hard to say. We are dealing with an extremely volitile market that is being driven by frenzied emotion. Investors are afraid.

Markets capitulate when they reach lows that are lower than anybody expected.



FWIW, I used to work as an investment manager. Lately, when I hear the stock market reports I pause and remember the last recession and thank God that I got liad off from that job and am no longer responsible for anybody's money but my own little pittance.

Thank you.

He's a retirement planner. His stomach's been in knots lately. His biggest fear is that the market loses 60 - 70% of its value from the Dow high back in 2007.

back in 2002 when my employer laid off well over 30% of the workforce. I decided then not to pursue further employment in the industry. Lots of reasons for that.

I'm not sure I could handle the pressure this time around. I thought it was bad during the last recession. This looks to be worse and to stick around much longer. If the Dow were 70% off its high around 14,000 then it would be somewhere around 4200. Sad to say I would not be surprised to see that. If it happens a lot of people are going to be very badly hurt.

Your Dad is stressed in ways you cannot understand unless you have shared his responsibility. It is one thing to feel the loss of your own investments. It is quite another to compund that with the responsibility for losses suffered by folks who cannot afford it and who trusted your judgment and recommendations. Your Dad is dealing with some very unhappy folks who may be quite afraid, confused and angry. Be extra nice to him right now.

Besides, I decided to follow in his footsteps and get an MBA/Finance. Right now I'm looking at this depression as a very interesting and horrifying homework assignment.

to make that same career transition. I started working as an investment portfolio manager in 2000 after completing my MBA in finance. I worked at a multinational then was recruited to a trust company. I left the industry in 2003.

I never got to be the hero I just got to experience the misery of riding the market down. Hope it turns out better for you.

Strange world we live in.

To boot, there doesn't seem to be enough physical gold to meet demand.
Junk like Krugerrands is bringing as much as 10% over melt (bullion
value) and "real" coins, like the old $20 pieces (0.9675 ounces) are
bringing between $1300 and $1600. Total insanity, and showing no sign
of letting up. When it falls, it will be fast and hard.

I've heard this argument on DU a couple times now but not seen one piece of solid evidence that the overselling is actually happening. If you have some links to prove the argument, I'd love to see them.

I know the gold traders at Heritage Rare Coin Galleries in Dallas, and talk with
them on a regular basis. They give me the current state of things, and I get my
information from them, as well as from some contacts here in Europe with whom I
speak, as some of their their offices are in the neighborhoods where I work.

They have told me of one outfit in Florida who has made commitments to mass marketers
and cannot make delivery on what they promised. Heritage is more conservative and does
not promise stuff in advance, or else (DUH) they wouldn't be telling me that.

Other than that, I'm not sure "overselling" is the right word to use for the general
market situation (the Dallas guys could put you up to date on that). All but the most
daring of traders in physical items available in finite quantities trade only in the
quantities they can get their hands on. If there isn't enough of something, marketers
bid the price up until they can get something they can sell. I was told by a gold trader
in Switzerland that the bullion "Britannia" coins (English version of a K-Rand) were not
available for 2 months because someone in Dubai had bought up 2 months' worth of the
upcoming production.

The shortage (of coins, anyway--that was an old hobby of mine, and I have no idea about, or
interest in, bars or jewelry) is for real, although probably not permanent, as it never is.
You can call Heritage up yourself if you want info from people whose day job it is to deal with
this on a daily basis. They have an 800 number if you're in the States. If a live person in the
business is not too old-fashioned for you, call them up and ask for their gold coin traders.
That's my "link," and I consider it a far more reliable source than some anonymous writer of an
internet article.

do not define the entire market. Although it may be a legitimate tracker of what is going on, I'm interested in more hard facts and published information. This is where google will continue to be my friend, but I thought some more well founded facts might be available here before I delve into what's online.

I've invested in gold, all on-hand, so the delivery is not an issue, but I'm just curious why you claim Krugerrands are "junk?"

ETA: Read your response to the other poster about the "junk." I see your POV is much more related to collectors than investors. Also, I find it a very slim to none chance that the Gvmnt will come to my door and try to take my gold away. Anything is possible, but as you mention, that is such a freeper notion and concern, that I can't even begin to take it seriously.

Thanks for the input from the collection POV. I collected baseball cards not coins, so the insight is appreciated.

Here is the link, although it's on this thread somewhere:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=5116073&mesg_id=5116737


Also, Heritage does not publish articles on the gold coin situation, as they are
mainly wholesalers. You can find plenty of articles written by the people Heritage
supplies, but those articles are almost always written with a positive slant toward
the particular kind of coin mentioned in the article, as those articles tend to be
thinly disguised sales promotions written by retailers, or people who are paid by
retailers, or are associated with retailers. Heritage is who the retailers go to
for the coins they promote--a far more reliable (in my experience) barometer than
something written by, say, some of the mass marketers in Louisiana or California--
or their front men (often in NY) in the "prediction and analysis" business.

They are worse than the Dow 36,000 crowd.

Like you said.............

I ask because I inherited a few.

To someone who collected coins as a kid, I appreciate coins that were really minted
as, and intended as real circulating money. Items like Krugerrands were, and are, made
in mass quantities as a marketing ploy for the South Africans to sell their gold in
units that the "average guy" can handle. Of course, this was far more the case back when
they first started making them in 1967, and gold was under $40 an ounce. At $1000 a pop
these days, they are not junk in the sense that you toss them in the trash when you are
tired of looking at them--not when 200 of them buys you a house. But to someone who
appreciates an older item, especially when it might have been minted out of gold found
in the California gold rush or the Comstock Lode in Nevada, or Pike's Peak gold in Colorado,
K-Rands are modern junk--expensive junk, but no real historical meat to them.

The older American coins also have one aspect to them that appeals to the right wing, but
makes them also more salable. Remember that in 1933, when gold coins still circulated in the
USA, Roosevelt called in all then-circulating gold coins and melted the ones that were turned
in as well as the ones still held in the Treasury that had never been released into circulation
after having being minted. Only gold coins considered to be of collector value were exempted,
and continued to be allowed to be privately held.

on edit--I forgot to mention that the ones that were already held outside the USA at the
time of the 1933 gold recall obviously also never made it to the melting pot. As no one
ever monitored how many were outstanding and how many were melted, no one knows how many
are still out there.

Don't forget that people like Freepers are always paranoid about the government coming to
confiscate this or that. It's usually guns, but that can expand to land or gold, especially
since it already happened with gold. But: all coins and banknotes minted by the United States
government are still legal tender by law, so the first thing exempted from such a confiscation
will be the old gold coins minted in the USA, especially since they are now so old that, no matter
HOW common they might be to a knowledgeable collector, they can now be arguably exempted as
"collector's items," as well as legal tender not subject to confiscation. You can't say that
about a K-Rand by any stretch of the imagination.

At any rate, this is why modern ounces of gold bullion, even if made into round coin form,
are not really considered as "coins" by people who are into coins, but more as bullion items,
especially since governments around the world are still churning them out in mass quantities
as fast as they can, even if, at the moment, they can't make them fast enough to satisfy
current demand. Ergo--from a collector's point of view, "junk."

A bit long-winded, but maybe I have explained the "junk" aspect better than I did before.

before the year's out.

When it's gaining steadily every day, suddenly everyone's an expert on just how
high gold will go. They said gold would hit $5000 an ounce back in 1979-1980 when
it ran from $200 to $800. The radical right said gold would hit $1000 an ounce when
Clinton was elected, as a Democrat in the White House would wreck the economy and
destroy the US dollar. Gold was about $260 when Clinton left office. When the Dow
hit 13000 last year, all I heard was that it had plenty more room to go, blah blah.
the truth is that no one knows when the party is over, and when it is, chances are,
there will be a LOT of people left holding some VERY expensive gold, just like after
last year, there were people holding some VERY expensive real estate.

It's no great skill to say a runaway train will keep going. The guy that I'm in awe
of is the one that accurately predicts when it will stop. With gold, as with any craze,
it's usually well before self-declared experts say it is. That having been said, rules
are made to be broken, and it MIGHT hit $2000. But it's a prediction that will come true
SOME day. California is supposed to have a big earthquake that wrecks L.A. and the Bay
Area...SOME day. It COULD be tomorrow, but I'm not holding my breath. Same goes for
gold at $2000, as far as I am concerned. If some guy comes up to me and says he predicted
gold at $1000 in 1980, and says "I TOLD you so!!!" I'll just remind him that in terms of
1980 dollars, today's $1000 gold is about $300. Not such a great long-term investment.

but Thousand Bucks may just be teasing it. I know, from experience. Thousand Buck's a tease.

I'm not yet sure that I envy you, but I'm certainly curious! :rofl:

I've been tempted by a Thousand Bucks many times. You know, you take that vacuum cleaner door to door sales job, with a Thousand Bucks a week leading you on, but nobody's buying. A Thousand Bucks if you sign up for this fantastic marketing plan...but she never shows up.

And now it's Gold. Gold went right through Eight Hundred Bucks and left her crying. Nothing would do but a Thousand Bucks. But a Thousand Bucks sees Gold coming...it won't be pretty.

Don't believe that a Thousand Bucks is waiting for you. She'll lead you down the primrose path, for sure, then leave you with empty pockets and a bad taste in your mouth.

Take my word for it, brother.

Gotta keep looking for the bright side. :)

:-)

sP

I just keep getting smaller cups. I set aside the shot glass and I'm down to using a thimble now, but it's positively brimming! :)

People have been sitting and waiting .... waiting for the DOW to turn back up, waiting for a sign that there is a bottom and that we have reached it.

No dice! THere is still room to drop even more .... the difference is that people holding on to tanking stocks are watching their blue chips' value dip below 50% of what they were worth when the market was at 14k.

The last step is to give in ... capitulate ... sell at whatever price can be obtained.

Also, there is a shit-load of money on the sidelines, and the p/e ratios are already getting real attractive. After the bottom is successfully tested a couple times, there could be a rather strong rally.

x(

Carly

last spring. We lost a bit before my husband couldn't stand it anymore and yanked them, but at least we've stopped the bleeding now. This is some scary stuff when you're our age.

...and BOY are we glad we did....We have 20 years until we retire, so when we look back (hopefully) these days will be looked on as the best opportunity in generations to have bought down...(figuring out where the bottom is the tricky part though... ;-))

I took what was left, and it's not much, pulled it out of the market and put it in a 1 year cd. My broker said I was making a big mistake, I told him that if I don't do something now there will be no money left to invest, and whew I am glad I did so.
Carly

Well, it's only $500, so, no whining here.

I've really never been able to invest, and this is why.

http://www.americaslibrary.gov/cgi-bin/page.cgi/jb/wwii/stockmrkt_1

http://econ161.berkeley.edu/TCEH/Slouch_Crash14.html

Yes, in other words, anybody who has studied the great crash KNOWS that this is not unexpected.

The next two years will be hellish, especially this year

My advise, don't open your statements, if you get them... not good for the spirits

And if you live on your 401 K, expect this to get much worst before it slows down and finally reverts

Oh and another piece of trivia, the Dow Jones did NOT recover until the 1950s from the worst lows

Inflated Greed thanks to the last 8 years of Bush/Cheney.