Stock Market is the bottom in?

As other have said - each person decides what makes them happy and/or secure. If I had hit the Mega-Millions j-pot for 1 billion - I wouldn't be driving a Mercedes, a Jag, a Porche, or a Lamborghini - and they can keep the French Riviera. I'd be driving a comfy F-150, and still wear jeans & sweatshirts. It's how I'm comfortable!! I'd be miserable in Italian $$$$ loafers and suits. I'd buy LAND. About 1000 acres so I could do what I want and give some land to our sons. I'd have a big veggy garden & fruit trees to feed our family & the deer - of course. I'd build an energy-efficient house with a roomy porch all around it, so I could park my butt on it and invite neighbors over for coffee and home-made pie. I'd also build a big bunkhouse for guests with nice bathrooms. That's living in my book.

Valuable things are only so because we put value ON them. Indians put big value on beads, shells, feathers, and hides. Not any real value today on those things. Gold is precious because we attach value to it. If we were starving, would we want a gold coin - or a turkey dinner. It's all relative.
 
Bowsnbucks said:
As other have said - each person decides what makes them happy and/or secure. If I had hit the Mega-Millions j-pot for 1 billion - I wouldn't be driving a Mercedes, a Jag, a Porche, or a Lamborghini - and they can keep the French Riviera. I'd be driving a comfy F-150, and still wear jeans & sweatshirts. It's how I'm comfortable!! I'd be miserable in Italian $$$$ loafers and suits. I'd buy LAND. About 1000 acres so I could do what I want and give some land to our sons. I'd have a big veggy garden & fruit trees to feed our family & the deer - of course. I'd build an energy-efficient house with a roomy porch all around it, so I could park my butt on it and invite neighbors over for coffee and home-made pie. I'd also build a big bunkhouse for guests with nice bathrooms. That's living in my book.

Valuable things are only so because we put value ON them. Indians put big value on beads, shells, feathers, and hides. Not any real value today on those things. Gold is precious because we attach value to it. If we were starving, would we want a gold coin - or a turkey dinner. It's all relative.
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Reminds me of the way Black Elk described gold. He called it the yellow rock that wasichu's go crazy for. It's value goes all the way back to ancient civilization yet it has no practical use.

Our entire monetary system only works as long as we all agree it works. It's why I like to be invested in tangible things like real estate. I'm more comfortable investing in something I know is real and will continue to be so. Still, nothing is guaranteed. If society collapsed, we would all find out real quick that none of us actually own anything that we can't carry and protect.
 
Just to be clear, The USD is backed by American tax payers. Without the taxpayers, the government ceases to exist. One could make an argument for public property but it's still going to lead back to the people.
 
Here is a good explanation why debt is good and you don't pay your mortgage off early.


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chummer said:
Here is a good explanation why debt is good and you don't pay your mortgage off early.
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The land I just bought is financed for 20 years fixed at a 3% interest rate. I could have paid it off but if my advisor can’t make better than 3% a year for 20 years he won’t be my advisor long.

Beach house goes on the market next week. NYC’s exodus to the Jersey shore has driven prices through the roof. Realtor says we’ll get 150% of the purchase price we paid 3 years ago. I can’t not take that kind of profit in 3 years on something I don’t need.

May not sell though, we’ll see...
 
chummer said:
Here is a good explanation why debt is good and you don't pay your mortgage off early.


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There is a difference between debt working for you say in say a starting a business, versus having constant debt on items (car, mortgage, etc.) that you have long payments and you pay majority of interest up front.

The problem is that most people rationalize debt ... eventually living on credit because their debt payments consume all income. They really do not understand their basic financial pyramid and how to balance everything.

As someone earlier said, cash rules!

Suggesting debt is good to many is like telling a fat kid that pop tarts, ice cream, and a snickers bar is a good breakfast!
 
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Tree Spud said:
There is a difference between debt working for you say in say a starting a business, versus having constant debt on items (car, mortgage, etc.) that you have long payments and you pay majority of interest up front.

The problem is that most people rationalize debt ... eventually living on credit because their debt payments consume all income. They really do not understand their basic financial pyramid and how to balance everything.

As someone earlier said, cash rules!

Suggesting debt is good to many is like telling a fat kid that pop tarts, ice cream, and a snickers bar is a good breakfast!
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It is a two part system, you do have to invest the money or it doesn't work but what do I know I still eat Pop Tarts. Frosted cherry or frosted cinnamon


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chummer said:
It is a two part system, you do have to invest the money or it doesn't work but what do I know I still eat Pop Tarts. Frosted cherry or frosted cinnamon


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I like raspberry pop tarts.
 
Pop tarts are for 5 year olds.
 
chummer said:
Here is a good explanation why debt is good and you don't pay your mortgage off early.


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That does have merit.

But so does paying off your mortgage so if anything would ever happen with ones career or finances owing on a mortgage will not be a worry.
Having your house paid off is a game changer , frees up so much extra money for other things.
Being able to fall asleep every night in the security of a mortgage free home.....priceless!

And I love the new pop tart mini bites for duck/deer hunting snacks.
 
chummer said:
It is a two part system, you do have to invest the money or it doesn't work but what do I know I still eat Pop Tarts. Frosted cherry or frosted cinnamon


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Pop tarts are awesome, cherry is the best! My parents had a charge account at the small grocery store, I used to charge pop tarts for my friends on the bus trips in Western MN for high school basketball games...until they found out (LOL) nothing like a pop tart and a Mountain Dew after a basketball game in high school!
 
I will start a new thread
 
H20fwler said:
That does have merit.

But so does paying off your mortgage so if anything would ever happen with ones career or finances owing on a mortgage will not be a worry.
Having your house paid off is a game changer , frees up so much extra money for other things.
Being able to fall asleep every night in the security of a mortgage free home.....priceless!

And I love the new pop tart mini bites for duck/deer hunting snacks.
Click to expand...


Think of it this way. If I have a 30 year mortgage at 3% (for sake of argument), I know I can make fairly stable mortgage payments for 30 years and pay it off. Or, I can pay extra each month, and (for sake of argument) I can pay it off in 15 years? I will pay the same principle but substantially less interest over the, now shorter, life of the loan. So, what happens to that extra money that I'm paying each month if I don't put it toward the mortgage? Well, if I spend it to live a higher lifestyle, putting it toward the mortgage would have been a good investment. But, what if I dollar cost averaged it into the broad market each month (S&P)? Over 30 years, a 6% return is fairly reliable.

So, what happens if I loose my job part way through. With the 30 year mortgage, I'm still obligated to make that minimum monthly mortgage payment regardless of how much I've been paying up to this point each month. With no income, if I can't make the payments, I may be forced to sell the house or be foreclosed upon. If instead, I had been putting that money into the market which is much more liquid and earning on it, I can now dollar cost average out of the market paying that mortgage each month until the money runs out. That gives me time to get another job and go back to making mortgage payments from my income stream.

So, in reality you do hit the nail on the head, but it is not financial. It is psychological. If your personality is such that you sleep better at night knowing your house is paid off, there is value for you in paying it off early. If you do the math, it all depends on what kind of mortgage rate you can get at the time, how favorably mortgages are treated from a tax perspective, and if you believe the long-term market averages are a reasonable predictor for the next 30 years.

Thanks,

Jack
 
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I am just waiting for the bottom to fall out. ( i think it will happen within the next two years)The fact everyone doesnt want to keep cash because of inflation is telling.No one wants to buy bonds because of it either. Once the goverment started printing money I think it went past the event horizon. The only thing you can depend on is the goverment attempting to print it's way out of this mess. how many more trillion dollars print cycles can we go before. If that isn't bad enough the powers that be are on a spree trying to give things away for free. ( a few steps away from full blown communism)
 
Bszweda said:
I am just waiting for the bottom to fall out. ( i think it will happen within the next two years)The fact everyone doesnt want to keep cash because of inflation is telling.No one wants to buy bonds because of it either. Once the goverment started printing money I think it went past the event horizon. The only thing you can depend on is the goverment attempting to print it's way out of this mess. how many more trillion dollars print cycles can we go before. If that isn't bad enough the powers that be are on a spree trying to give things away for free. ( a few steps away from full blown communism)
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One more point to ponder is economies performance tend to be relative. When times are tough in one market, money flees to another. So, one question I'm asking myself is this: On a relative basis to other economies in the world, what is the impact to the American economy? This COVID impact is world-wide. I started moving into cash before the COVID hit because the market seemed toppy and Trump was unpredictable. After we rebounded from the crash and started making new highs, I resumed my movement into cash thinking just like you.

I'm now rethinking things. If the left wing of the Dems take over (Biden dies and we get Harris or something like that) it will have a negative impact on the market unique to the US, but we swing back and forth between ruling parties all the time without huge market impact. COVID will have a bit long-term impact on the economy, but that impact should be world-wide. With no place else for money to go, we may not see as big of a market dip as I expected in the next couple years.

Time will tell. I'm a bit torn at this point...:emoji_thinking:

Thanks,

Jack
 
Trump was unpredictable and you moved money to cash before COVID? I was getting every last dollar into the market before COVID and after COVID. I hedged a little when Biden won but as soon as they committed to printing their way out of this it all goes in the market. If a crash comes I will get out and buy back in when the bottom is reached.
 
chummer said:
Trump was unpredictable and you moved money to cash before COVID? I was getting every last dollar into the market before COVID and after COVID. I hedged a little when Biden won but as soon as they committed to printing their way out of this it all goes in the market. If a crash comes I will get out and buy back in when the bottom is reached.
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The problem is that we never know when a crash comes until it is here. Market timing is a tough game. In general, I don't play that game. The primary reason I was moving into cash was because I'm nearing retirement and was almost 100% in at the time. My only timing aspect was starting to move it when market was at new highs.
 
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