Stock market boom on the horizon?

[mysql]

A very good recap. Hard to dispute what is obvious.

It isn't so rosy once you factor in inflation.

On the chart, the long term trend line in green shows an average return of 1.9% per year. If you factor in the long term 15% capital gains tax, the return is even worse. Since capital gains tax is not adjusted for inflation, the average tax must be based on the 5.4% trend of the non inflation adjusted chart, so 15% of 5.4% is a 0.8% tax. Therefore, your 1.9% return is reduced to 1.1% after taxes. Most people have no idea that this meager amount of capital gains is all they should logically expect from a long term general stock market investment.

The Dow has historically moved within well defined channel. The boundaries of the channel have been touched only 4 times since 1910. The top of the channel was last touched in 2000.

They say "the market always goes up in the long term," but at an average return of 1.9% per year, it can take many years to recover from a large decline. The peak in 1929 was not ultimately exceeded until 1992. When the market touched the bottom of the channel in 1982, its value was about equal to the value at the beginning of the chart in 1910.

 

[semi]

if your broker is only managing an average 1.9% return, you need to put on your firing cap and find some new people! you can make money if the market is going up or going down, it's just that most people don't want to be bothered with taking the time and effort to manage it..."just buy and hold and you'll be a millionaire when you get old" fits right in with the norm of the lazy, self-indulgent citizens of this world! it is well worth it in the end to pay attention to what your money is doing for you after you have earned it

 

[TallTom]

It isn't so rosy once you factor in inflation.

On the chart, the long term trend line in green shows an average return of 1.9% per year. If you factor in the long term 15% capital gains tax, the return is even worse. Since capital gains tax is not adjusted for inflation, the average tax must be based on the 5.4% trend of the non inflation adjusted chart, so 15% of 5.4% is a 0.8% tax. Therefore, your 1.9% return is reduced to 1.1% after taxes. Most people have no idea that this meager amount of capital gains is all they should logically expect from a long term general stock market investment.

The Dow has historically moved within well defined channel. The boundaries of the channel have been touched only 4 times since 1910. The top of the channel was last touched in 2000.

They say "the market always goes up in the long term," but at an average return of 1.9% per year, it can take many years to recover from a large decline. The peak in 1929 was not ultimately exceeded until 1992. When the market touched the bottom of the channel in 1982, its value was about equal to the value at the beginning of the chart in 1910.

Now you understand why in my earlier post , I said I am no longer in this! I get with guys that KNOW how to chew this type stuff and go...Man I need something way easier to understand. I'm a real estate guy. In my life out of all I have invested in, real estate has been my best return and I understand it. I don't understand stocks as I need to. I relied on brokers to help steer my decisions. BAD IDEA!!!!!!! They make money on my transactions, not my profits or losses. I will never forget calling my broker and going...If Ford is at $4, shouldn't I be buying now? Nahhhhh, you need to find a GOOD stock.

Houses I get. Some I buy for long term. Some for short. But I know what they represent going into it. I can see a Phorked up roof or etc. I can see a good house that has fallen into bad circumstances. It's tangible for me. And I get that many can't see them the same way when I look at them. I guess we each have our aptitudes.

I do have some stocks that a good friend (may he now RIP) helped me on that have been long term performers. But not because I knew they would be. LOL.

 

[mysql]

if your broker is only managing an average 1.9% return, you need to put on your firing cap and find some new people!

If you're responding to me, then I think you misunderstood the post. That's for the DJI as a whole. Someone previously posted the NASDAQ composite, but those gains are not nearly as nice when you look deeper.

I am not even getting into the way the government is currently calculating inflation. CPI number is deeply flawed, and only as low as they claim by leaving out price increases in food and energy.

This means you typically need at least a 5% growth in order to retain the money you've already earned.

 

[IG.]

mysql, the problem with using DJI chart is that it fluctuates too much. Even more so if you consider the same period shown for NASDAQ - '75 or so through today. That is why investing in DJI is... unpredictable. Not to mention smaller returns than NASDAQ, although the latter one has higher risk.

 

[red1100cc]

it got so bad, im out. before im totally broke.
I hate the freakin market!!!

 

[semi]

If you're responding to me, then I think you misunderstood the post. That's for the DJI as a whole. Someone previously posted the NASDAQ composite, but those gains are not nearly as nice when you look deeper.

I am not even getting into the way the government is currently calculating inflation. CPI number is deeply flawed, and only as low as they claim by leaving out price increases in food and energy.

This means you typically need at least a 5% growth in order to retain the money you've already earned.

no, i understood and was not directing my comments toward you...it came more from a place of frustration with certain family members that want to be able to just throw money at an investing dartboard and have it magically grow...if a person is going to beat industry standards and not lose their shirt (and possibly their pants) when the market corrects or downright crashes, they are going to have to spend the time and effort required to know what they are doing...otherwise, it is no different than gambling that they can "pick" the right name off a page

 

[mysql]

If anyone cares, I converted my 401k into short term bonds.

I picked them because I believe the market is due for a correction. Short term bonds because they won't drop in value if the bond rates climb.

This will give me ~3.5% gains per year (includes company stocks that I can't opt out from).

I might miss out on additional market gains while I do the holding pattern, but given the choice between going all in and risking a market drop or modest gains (that admittedly don't completely cover actual inflation), I'll do the safe route until I'm satisfied that we're not due for a correction.

My employer does 100% match, so I gain regardless.

 

[IG.]

Just a small observation...

In retrospect, I remembered someone was saying this many years ago, maybe even someone well known: if everyone is talking about the stock market so much that even your barber is talking about it - that's the time to get out. It was so true - my barber kept talking about it. I knew the expression even at that time, but of course I ignored it. LOL

Now, there is another expression: when everyone is skeptical of the stock market, and everyone is afraid to invest - that' the time to get in.

Decide for yourself.

 

[kml]

nope... LOL

 

[TallTom]

Up 600 points before the open. Crazy.

 

[skydivr]

Post #11...

People suspect the free money the fed's been throwing around is gonna cease cause they think a conservative may get the WH, and are pulling out profits now...

 

[GP2001]

The market is still going to do a dramatic reset . When fed resv stops holding up market it will fall then big recalculation reset the whole mess. Only where is the question.

 

[Bobby B]

stock brokers can't even predict the market

 

[mysql]

if they could, they wouldn't be working as stock brokers.

same goes for fortune tellers. If you can tell whats going to happen, why do you have that job?

 

[TallTom]

stock brokers can't even predict the market

Stock brokers don't care what the market does. They make their money on fees they charge you to buy or sell.

 

[Bobby B]

Stock brokers don't care what the market does. They make their money on fees they charge you to buy or sell.

you're exactly right I can't help but think of Leonardo DiCaprio in "The Wolf of Wall Street"!!!! To be honest I have more fun at the craps table with a drink/s in my hand.

 

[RedBull]

#BOOM ~ #BullShit ~ #BuyInAndFail ~ #StockMarketScams ~ #THEoRg *

Lazy Today | Random Thoughts

Im up north camping for the weekend, LOL ive got internet sevice! I should be just sitting doing nothing but, oh well! It will soon be drinking time! Im at least in a tent not renting a redneck cabin, like some people!

www.hayabusa.org

 

[mysql]

you're exactly right I can't help but think of Leonardo DiCaprio in "The Wolf of Wall Street"!!!! To be honest I have more fun at the craps table with a drink/s in my hand.

he didn't predict anything. He basically pumped up penny stocks and dumped them on unwitting investors.