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I'm still 100% in cash in all my accounts and have been since the end of March. I lost out on about 5% of potential market gain by not being invested (I sold some in Jan and Feb at lower prices than my biggest sale in March and collected interest that was lower than the dividends afterwards).

 

Last Friday, I bought SPY puts at $140 for Dec 22 and $135 on Jan 19. The last time I bet that the market was going to go down (spring of 1999) was a few months before the dot com bubble burst. But I shorted 4 internet stocks and lost a LOT of money. At least this time, I've limited my exposure by using puts instead shorts.

 

Dan

 

It might be time to close the Puts on SPY since Ben just took a seat on the other side of the table - he has VERY deep pockets.

---ron

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Wow!

 

This is the single most stunning and accurate profile of Elon Musk I have seen yet! For those still on the sidelines this is a must read if they want to invest again. For those who don't care about great person picks behind the stocks and don't care if the world stays status quo this will do nothing for ya. But for the rest, it will show what I have seen in him since the PayPal days. The times they ARE a changing!

From Bloomberg Business Week:

http://www.businessweek.com/articles/2012-09-13/elon-musk-the-21st-century-industrialist

 

 

On edit: Sorry I originally posted the mobile version from my tablet. The above link is much better on a computer.

Edited by RV
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There was a report on CBS this morning about the "Gang of 8" (senators, 4 Republican, 4 Democrat) plus Simpson & Bowles meeting in Mt Vernon VA to try and figure how to get past the January 2013 sequestration/Over-the-Cliff problem. What got my attention was the reporter quoted one of the gang of 8 as saying he did not believe there would be a good resolution by January. This un-named individual said there would be "market impacts" and also some increased taxes starting January. So I sent an e-mail to my Escapees financial advisor stating my concern about the part of my money in the market. I received an almost immediate response from his office which said they too were looking at this and would be sending an e-mail article in the next few days. I pulled back a few years ago before the last big drop and was glad I did. It looks like I might do it again.

 

Hank

SKP67414

2005 Mandalay DP

2012 Honda CRV

Custer, SD

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Good article Ed!

 

I have been looking at the charts too and it is funny how when you print out a five year chart they refuse to admit it is real. They make excuses and then will say Yahoo is manipulating the charts for devious political purposes.:lol: :lol: :lol:

 

You know folks the charts don't lie. The terrible economy did take longer to recover than lesse recessions like the several panics we saw in the last five years. Predictions and charts of nit picks and political beliefs and agendas just can't overcome the truth that we have been doing very well indeed. Funny though that FUD is not automatically a self fulfilling prophecy. Since FUD makes folks back off and there is a constant barrage of FUD on threads like this and on the news, especially with media that has political agendas joining in on the big lie theory, we are doing much better and improving. The housing bubble bust and the financial sector meltdowns of 2007 took a year to become as dire as they would. Fear drives markets but no more than confidence can.

 

Please don't read into my next comments any taking shots at folks who dropped out or idolizing folks who stayed in. Uninformed Pollyanna optimism loses as much as bitterness and cynicism.

 

So how can I make such statements and say that I am not the rule in the ones with confidence, I am not the best experienced or informed. Don't want to be. Not involved in the fear and drama. But in order for the markets to have improved so dramatically since the greatest recession since the great depression says something indisputable. There are many great men, with great amounts of money and influence at their disposal, who have confidence and don't invest naively, nor withdraw in fear. For there to be this much improvement there are a lot of folks that, like me, believe in America, lots.

 

How could I say such a thing? I don't. The five year charts for the NASDAQ, the DOW, and the the S&P say all that needs to be said.

 

Here is one of my funds, if the 5 year chart does not show then just click on five year.

 

http://finance.yahoo...ource=undefined;

 

Here is the five year chart for the NASDAQ

 

http://finance.yahoo...ource=undefined;

 

Here is the DOW

 

http://finance.yahoo...ource=undefined;

 

Here is the S&P 500

 

http://finance.yahoo...ource=undefined;

 

I honestly don't understand why some folks call our recovery non-existent. Maybe they watch scare FUD media with no critical eye, just watching for what fears of theirs are erroneously reinforced. IN saying that I am talking about the talking heads, the screaming 30 second investment analysts, and the long dissertations on economic theory online and off, and the day traders who will risk money on a great stock betting against it or for it, then blame the market and call our recovery not a recovery, when their high risk bets on a low risk stock cause them significant losses.

 

Yes again I am still in. I look at the five years charts to reinforce that the hue and cry going on now is nothing but FUD. I see what has actually happened.

 

I still am angry that the ones responsible for the troubled assets ( read criminal activity with other people's money) who went looking for relief in TARP in 2008 to keep their ill gotten gains and not serve one day in jail! Not one Wall Streeter or Banker served one Day in jail or paid any penalties. They destroyed our economy taking our money once, then in 2008 took more of our money and walk around today laughing.

 

I may be angry at those specific individuals, but I have nothing but confidence in American business and innovation and our future.

 

Next up should be getting the congress to enact legislation to stop their corruption and manipulation of investing with insider information. Sent Martha Stewart to jail for what they get rich doing daily.:angry:

Edited by RV
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Looking at those charts and the CNN article makes me wonder if an increasing number of people are deciding that it is time to sell - you know, "buy low sell high?" They also make me wonder how the markets keep going higher if more and more people are selling like the CNN article seems to say?

 

Oh, I forgot, the Fed's stated policy is to inject money into financial markets to give them a boost (others call it re-inflating markets) so we once-again-wealthy folk will go back to our spending-ways and help the recovery. Problem with that is about half the population doesn't own any stocks and most of the growth in income generated during the "recovery" is going to the top 1%. So instead of that extra income going to buy more goods and thus helping the economy, it goes into investments (stocks, bonds, gold, land, luxury goods) the places the 1% put their increased incomes. The 1% (and other very wealthy folks) don't increase the amounts of milk, bread, clothes, shoes, gasoline, etc. etc. when they get more income because they have not had to cut back on these purchases during the downturn like many of the rest of us have had to do.

 

Oh well, be happy, it is always fun to be on the right hand side of the charts, but there is always another left side and it is the next left side that takes the cake - literally.

 

Wouldn't it be educational to be able to look back at the posts on this forum in "Finances and Investing" say back in 2007 to 2009? I may be a pessimist, but I think being reminded of what life is like on the left side of the charts might be beneficial. B)

 

Cheers John

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So instead of that extra income going to buy more goods and thus helping the economy, it goes into investments (stocks, bonds, gold, land, luxury goods) the places the 1% put their increased incomes. The 1% (and other very wealthy folks) don't increase the amounts of milk, bread, clothes, shoes, gasoline, etc. etc. when they get more income because they have not had to cut back on these purchases during the downturn like many of the rest of us have had to do.

 

Who says?

We made quite a bit this year on investments (and trading) and put tons of $$$ back into the economy. No, we are not in the 1% or are any of our friends. But we did very well this year. We paid cash for another new home, car, vacations, etc.

 

Perhaps the charts are wrong...

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We made quite a bit this year on investments (and trading) and put tons of $$$ back into the economy. No, we are not in the 1% or are any of our friends. But we did very well this year. We paid cash for another new home, car, vacations, etc.

 

Perhaps the charts are wrong...

 

Well the article did not say that the 1% got it all, others got 7%. Congratulations, sounds like you got a very nice slice of the remaining 7%. I don't think the average person has recovered quite enough yet to pay "cash for another new home...."

 

Cheers John

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Clearly, the market can do well even in "challenging" times. The only thing that matters is the bottom line. If you stayed totally in during the last year you did fine. I'm "in" at the 2/3 level on my stock market allocations. I took 1/3 out during the course of this year. I'll put it back in during a major dip IF I think there is a chance for a near-term recovery (near-term being up to 2 years for me). If not, I'll put it into something else. For now it is just sitting earning about a half percent. Waiting. I've hedged my bet on this "run". We will see if it pays off.....

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" Problem with that is about half the population doesn't own any stocks and most of the growth in income generated during the "recovery" is going to the top 1%. "

 

I'm far from the top 1%, but like a lot of others who decided to stay the course and invest long term in a well balanced portfolio, I've done very well since the mid-60's. Started off with Sears and AT&T. A market timer I'm not.

 

Life is good in our financial world. Should the market be this high? Don't know. Is the Fed pumping it up? Yes. I do know that it's tough to fight reality. If the market wants to continue going up for reasons I don't fully understand, nor really care to, I won't complain. I have every expectation that five years from now, my portfolio will have grown by about 6%/year. That's my personal long term goal.

 

"Oh well, be happy, it is always fun to be on the right hand side of the charts, but there is always another left side and it is the next left side that takes the cake - literally."

 

Given time, you'll be right. There will always be a correction for some reason. The question is when. Will you commit yourself? In your opinion, when will the calamity you predict come to pass? What month & year?

 

 

"Wouldn't it be educational to be able to look back at the posts on this forum in "Finances and Investing" say back in 2007 to 2009? I may be a pessimist, but I think being reminded of what life is like on the left side of the charts might be beneficial. B) "

 

 

Here is one of your posts from 2011. You seem to be just the type of retail investor CNN Money was talking about. Just standing on the sidelines watching the game. What sort of return did you get from the MM fund? Let me guess. 0.25%

 

"From then until now we have been about 95% in Money Market funds. I did not trust the past 2-year bull rally, so stayed out and have been waiting for a significant correction such that stock valuations "match" the real economy which I think is still in a long run recession. I look forward to once again investing in stock funds and getting back to a diversified portfolio. Obviously these days I am smiling.

This post has been edited by mcbockalds: 08 August 2011 - 01:40 PM"

 

 

Still waiting on the "significant correction" ?? Or are you back in the game?

 

ed

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Some of the sideline folks probably base their investment strategy on the "expert opinion" from guys like Hussman. His Strategic Growth Portfolio has been repeatedly designated as the worst of its peer group by Barrons. Hussman looks at the charts with such profound pessimism even when the world is seeing potential growth. Buying this loser fund in October 2011 netting about a 15% loss to date. Investing in the S&P 500 yielded over 20% with dividends and even more if you played the volatility.

 

As I had posted on this forum, I cashed out profits in March - April when the market appeared high... then bought in again in May - July to ride the surge again. Recently I moved some back to bonds and cash ready for the next drop. Yes, I might miss some growth if the market decides to like the situation for end of year but I am more than satisfied with the growth for the year.

 

Thankfully I did not sit around with my thumb up my .... reading and posting the pessimistic trash and getting scared away from the market.

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" Will you commit yourself? In your opinion, when will the calamity you predict come to pass? What month & year? "

 

I have no clue when this re-inflated market will pop. The Fed is a powerful balloon blower as we have already seen over the past 20 or more years. These are amazing times we are living in. Never has the Fed been this active in manipulating financial markets for so long and the final results are far from in.

 

 

Yes, I said, "Wouldn't it be educational to be able to look back at the posts on this forum in "Finances and Investing" say back in 2007 to 2009? I may be a pessimist, but I think being reminded of what life is like on the left side of the charts might be beneficial. B) "

 

And then you refer to a post of mine from Aug. 2011: "Here is one of your posts from 2011. You seem to be just the type of retail investor CNN Money was talking about. Just standing on the sidelines watching the game. What sort of return did you get from the MM fund? Let me guess. 0.25%"

 

But I really did mean posts from 2007 to 09. However, to answer your question: Nope, even less than 0.25%!! But I try not to brag. :D Ok, just a little bragging. Our 5-10% in bond funds did great until we got out in Dec 2011 which proved to be very good/lucky timing.

 

 

 

"Still waiting on the "significant correction" ?? Or are you back in the game?"

 

Still waiting, but let me tell you why it is easy for me to be "Just standing on the sidelines watching the game." In 2000 I estimated that my wife and I had sufficient funds in our retirement portfolio (including Social Security of course) to last us through the age of 100 if our portfolio just kept up with inflation. Needless to say, that was a wonderful discovery, and it still is true. I'm 68 and for the rest of my life our investments only have to match inflation. Why? Because we are rich? Nope. For two main reasons: my wife and I have always lived frugally and it is natural for us to do that because we have never had a need for lots of stuff. This is who we are - most likely because of the families and the faith we were raised in. But enough of that faith talk! Sorry. :)

 

Cheers John

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Thankfully I did not sit around with my thumb up my .... reading and posting the pessimistic trash and getting scared away from the market.

 

I must admit a fault of mine, I like to read stuff like this because it makes me look even nicer than I really am. B)

 

Cheers John - your sideline coach.

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Still waiting, but let me tell you why it is easy for me to be "Just standing on the sidelines watching the game." In 2000 I estimated that my wife and I had sufficient funds in our retirement portfolio (including Social Security of course) to last us through the age of 100 if our portfolio just kept up with inflation. Needless to say, that was a wonderful discovery, and it still is true. I'm 68 and for the rest of my life our investments only have to match inflation. Why? Because we are rich? Nope. For two main reasons: my wife and I have always lived frugally and it is natural for us to do that because we have never had a need for lots of stuff. This is who we are - most likely because of the families and the faith we were raised in. But enough of that faith talk! Sorry. :)

 

Cheers John

 

Well you see that is the problem. Perhaps you have enough to live the rest of your time in the lifestyle you want. But perhaps others should continue growing their nest eggs so they can live comfortably or live a little beyond "frugal" if market returns are realized.

 

And you are the "coach"??? spewing all the pessimism, quoting the losers like Hussman, and almost trying to convince others not to be in the market.

 

Well you were wrong. In my opinion your coaching has been of little or negative value (if folks believed the hype). I am sure you are a nice guy. I am not. Who cares. The only thing that matters is your BS can possibly convince some that they should be sewing money into their mattresses like you.

 

Why not stop being a coach? And maybe I won't jump on your BS.

 

Hey, maybe I can earn a warning for this one.

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John,

You can only cry wolf so long before you get called on it. You have been reading here for a few years right? Were you reading when I was getting lambasted for paying off my property, and at the exact same time, 2007-2009 buying shares in our funds with most of my salary as we live on our retirements. I had money coming in, more than I could spend and so I invested whike everyone elsevwas bailing, well almost at the bottom, I missed the absolute bottom because I thought it was temporary.

 

It is when people are jumping out of Windows and the markets have crashed that I bought. I am sorry for those that panicked or bought high or got hurt. But cash to invest at the worst times is what makes for good long term investments. My funds are managed. My one stock is no diversifued or balanced.

 

My point John, and not in anger at all, but what could I have done any better?

 

It is easy to point to articles wrong or right that spout long theories and tediou proofs that their armageddon is coming. And the next big panic will be the final one? The end of the world has been predicted by men fearful of a vengeful God, gods and goddesses since recorded history. This is not new, just changed to the almighty markets.

 

All the justifications of the so called experts do not change those charts. Not political big lie theory and spin, not stock prognosticators saying we were lucky just wait, no denial can change the charts, which show that we are now economically better than we were when the markets and housing and the car industries crashed.

 

I remain respectful, but skeptical. I have been reading here for years and usually not posting.

Please proceed.

Edited by RV
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Well you see that is the problem. Perhaps you have enough to live the rest of your time in the lifestyle you want. But perhaps others should continue growing their nest eggs so they can live comfortably or live a little beyond "frugal" if market returns are realized.

 

And you are the "coach"??? spewing all the pessimism, quoting the losers like Hussman, and almost trying to convince others not to be in the market.

 

Well you were wrong. In my opinion your coaching has been of little or negative value (if folks believed the hype). I am sure you are a nice guy. I am not. Who cares. The only thing that matters is your BS can possibly convince some that they should be sewing money into their mattresses like you.

 

Why not stop being a coach? And maybe I won't jump on your BS.

 

Hey, maybe I can earn a warning for this one.

 

I do find your anger curious. It causes me to wonder, why would someone who has made such a killing on his investments that he, "paid cash for another new home, car, vacations, etc" be so angry at someone who is making next to nothing? Can anyone make a guess? And as a hint, I never put any stock (pun intended) in anyone's online claims about their personal investment returns. So I usually try not to discuss my own, because I don't expect anyone to put any stock in my claims either.

 

Cheers John

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Ok you two joust, I am so out of here. Not in fear or pretense of arrogant disdain, just that the content of the charts are fact. The emotions are unwarranted. The belief of another is not required for my balances which are not in the hundreds of thousands, maybe in a few years but not now.

The reason I am out of here is my ego is not at risk, and I have no dog in a king of the hill fight.

I wish everybody the best. ;)

Edited by RV
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Yeah I agree with you RV. I very seldom read any of John's posts. I haven't seen anything worth while from him in a very long time. I haven't a clue if he thinks he is the main guru here or posts so he can hear himself. Actually I think he only posts so that he can show everyone how much he reads/listens to on the net.

I saw a cartoon a week or so ago and it was a teenager asking his school economy teacher that if he was so smart, why wasn't he a working on wall street.

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The next few months are certainly going to be interesting in the markets. We have the election and the "fiscal cliff" issue that must be dealt with. It's all rather exciting.

 

But then again. . . maybe this Mayan doomsday thing will come true and there will be nothing at all to worry about :D

 

 

Jim

Edited by Jim Rack
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Duke I don't know either because I read a few but it seemed like fortune telling without the obligatory vision of the future. That not meant harshly, anybody can continually predict a given good or bad perspective consistently and be right once in awhile. If I say a stopped clock is always right twice a day someone will say untrue if it shows AM/PM and/or the Date. Opinions are just that. Earnings and economic charts of the major American indexes are facts not opinions. Telling me that there economy has not recovered when it has is counterintuitive. Then sidetracking with tedious reasons why on why it will soon, without acknowledging the facts is disingenuous.

 

Jim I agree. Bully for you! It bears watching. I couldn't resist! BTW thanks a lot for the offline help understanding some of the basics of the mechanics of the ways to invest. I hadn't forgotten, they did clear up a lot.:D

Edited by RV
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The story about the shepherd who cried wolf when he knew there was no wolf, is a story about liars. I may be wrong about what I think is going on in our economy, but I hope no one actually believes I am lying - I don't really think any one does think that.

 

So, here is another negative view of our economy that may be wrong, but I don't think they are crying wolf either, John Mauldin's "Outside the Box." The section of the article toward the end titled "Can the Fed Create Demand" is going to be "over the top" for some who have not had an econ course or for whom it has been a long time since having one, so don't fret about it. My advice is to just skip it and read the last section titled "Treasury Bonds."

 

Cheers John

 

edit: I forgot, you have to freely subscribe to Mauldin's site. Then you are looking for the article in the section:

Outside the Box

Hoisington Quarterly Review and Outlook

Edited by mcbockalds
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The story about the shepherd who cried wolf when he knew there was no wolf, is a story about liars. I may be wrong about what I think is going on in our economy, but I hope no one actually believes I am lying - I don't really think any one does think that.

 

So, here is another negative view of our economy that may be wrong, but I don't think they are crying wolf either, John Mauldin's "Outside the Box." The section of the article toward the end titled "Can the Fed Create Demand" is going to be "over the top" for some who have not had an econ course or for whom it has been a long time since having one, so don't fret about it. My advice is to just skip it and read the last section titled "Treasury Bonds."

 

Cheers John

 

edit: I forgot, you have to freely subscribe to Mauldin's site. Then you are looking for the article in the section:

Outside the Box

Hoisington Quarterly Review and Outlook

 

I don't think the folks that make a habit of "crying wolf" are necessarily liers. They may actually believe they see a wolf. Perhaps you and Mauldin both fall into that camp. Before anyone invests his hard earned money following the advice of "perma bears" like Mauldin it might be beneficial to read this:

http://investingcaffeine.com/2010/04/14/john-mauldin-the-man-who-cries-wolf/

 

There are a lot of ways to make money in the stock/bond markets but you will have a hard time finding many "market timers" that are successful over a long period of time.

 

Not advice - Just my opinion.

 

---ron

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