Does the rule that you should get out of the stock market when random people tell you stocks are sure to go up apply
in reverse?
If so, this is a pretty encouraging sign.
If so, this is a pretty encouraging sign.
"Be Fearful When Others Are Greedy and Greedy When Others Are Fearful"That being said, I don't think this reflects negatively on Tony. There are many other writers who I respect who show this annoying tendency (somebody has pointed out that Malcolm Gladwell and Thomas Friedman are especially prone to this).
http://www.youtube.com/watch?v=OfMbYllbN6c
(Skip to 2:40 for the actual start if you want.)
It is extremely unlikely that you will time the bottom of the market just right. So even if it will continue to get worse for a while, it might still be a good decision to continue buying into the market so that when the bottom does hit, you will have bought some stocks right around that time.
This all depends on your investment horizon, etc. etc.
If the last one, I'm inclined to think that someone who thinks about something full-time is statistically more likely to guess correctly about it than someone who doesn't.
I'm struggling to determine whether this fits the Liar's Paradox, or not.
If the system they're thinking about is a system defined by other people also thinking about it, and they're all trying to outsmart each other, and the system itself is too large and complex for any one mind to grasp, maybe not. And in fact, I've heard (no citation) that you'll as well on average throwing darts at stocks as hiring a stockbroker, and you'll save the fees. Which is why I'm inclined to invest in an index fund and forget about it.
I won't lie, I've been funding my IRA early lately.
It's depressing.
If you play it smart then this 'depression' is an opportunity in disguise, more of a correction than a true depression.
The 1929 stock market crash set the stage for World War II, and it took until well after World War II before the world had finally recovered from it.
That was a depression.
The current situation is, compared to that, a mere bump in the road. As long as we're not seeing hyper-inflation, the general population still has food on the table and you can actually think about where you're going to take your holiday this year we're not even close.
The really bad effects of what is going on in the market are still limited to a number of markets, mostly financing and the more expensive consumer items.
There are knock on effects that hurt other industries but so far without the nightmare scenarios coming true.
One thing is for sure, the time of 'easy money' from stocks or real estate investments is going to be over for a while.
"It's depressing" I know it is. But we as a population have to realize we are in a depression, not just a run of the mill recession like the mass media would have you believe, so we can react accordingly and not doom our future offsprings to even greater suffering.
"As long as we're not seeing hyper-inflation, the general population still has food on the table and you can actually think about where you're going to take your holiday this year we're not even close." Hyperinflation, not yet. 25% unemployed in the last depression, but they had soup lines to not go hungry. US has ~20% unemployment, and we have food stamps/unemployment benefits mailed to our house. As for the holiday..well you and I, we're in the lucky 80%.
Also, society as a whole is so much richer now than it was in the last 'great depression' that even those that are down on their luck have it comparatively easy compared with 80 years ago. It's a world of a difference.
That doesn't mean there aren't individuals that are on really hard times, but there are only more of them, it's not like the phenomenon is unique to 2010.
Sounds like we're back in the 80's - 'the Japanese are taking our jobs! The robots did it!' and then we went into the 20 most prosperous years humankind has ever known. I hear people cry left and right that today's job loss is systemic, but I hardly see any factual arguments to support that position. Jobs were cut over the last two years, this quarter profits are back up, and if those improved profits repeat themselves for a few quarters the confidence will come back and more people will be hired. A regular business cycle, even if the nature of the drivers is changing.
Now I'm not saying it doesn't suck for those without a job, and I'm sure some people have it really rough, but come on like Jacques says - today's poor (in the West) live lives 10 times better than the kings of 500 years ago. I'm sure that's no consolation for a welfare mom who has to put her children to bed some nights crying because they're hungry, but overall, these are still great times to live in. Let's keep some perspective, put problems in the right context and fix the comparatively small deficiencies rather than cry wolf, pack cans of beans and ammo and head for the mountains.
The weird thing is that it is more likely that mom and those kids suffer from chronic obesity, at least in the U.S. Doesn't change the fact, though, that the poor face much greater health risks than the affluent when it comes to nutrition. Just that the nature of those risks has changed, and take longer to manifest themselves.
The difference between then and now is that some of the people that were affluent then are feeling a little bit of the heat right now and they're scared shitless. But given a slight economic upturn they'll forget about all that and it's back to business as usual. Except for the people that had it bad in 2002, they'll continue to live in a way that a civilised country ought to be ashamed off.
There is no crisis, there is only a totally weird distribution of wealth that has temporarily gotten a bit weirder. If we really wanted then we could solve this problem, but all the majority wants is to return to the situation of 5 years ago.
"10 times better than the kings of 500 years ago." Yes, but both you and jacquesm are confusing technology advancement with an economic phenomenon, which is defined by high structural unemployment rate and many business failures
"pack cans of beans and ammo and head for the mountains." Nobody says you have to do that. 75% of the people that lived through the great depression lived a normal but frugal life. However, if/when the dollar suffers from hyperinflation, that's another story.
And you are telling me we are in a depression now?
http://www.google.com/search?q=tent%20cities
And the reason you don't see it every day? The criminalization of homelessness:
http://www.google.com/search?q=criminalization%20homelessnes...
The cushion is slightly greater because the lifestyles before this depression were higher than in the Great Depression (e.g. people have tents), there are more laws to protect lessees from landlords, and, of course, many people have credit.
But those are just cushioning. Cushioning slows the fall, it doesn't stop it.
It seems like about 25% of all children live in poverty - and the US' lines for poverty are lower than in many other countries:
http://www.google.com/search?q=US%20percentage%20of%20childr...