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Originally posted by JEWELSTAITEFAN:
Dow closed today at 24,947. That is 7.0% off the Record All-Time High.

It hasn't closed that low since, like, 6 trading days ago. The sky must be falling. Maybe there is still time to buy at discount pricing.

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Originally posted by JEWELSTAITEFAN:Chicken Littles should run for the hills.

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Originally posted by JEWELSTAITEFAN:
This is 10.2% off the Record All-Time High.

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I'm writing this in January 2017, a week before Trump's inauguration, feeling like we are about to reboot the
first decade of this millenium. Reboot as in the bigger bolder faster turbocharged 4K HD on steroids
with a sparkling drop of retzin version! (in case you aren't getting it - that means bad. VERY bad.)

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Originally posted by JEWELSTAITEFAN:
The most important number to watch for is 22,803.

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A little oddity with the newz - Lately they hav not been saying or showing the number. They say how much it dropped and the % for the day, but not wut it ended at. It wuz alwayz the main thing befor.

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Originally posted by JEWELSTAITEFAN:

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Originally posted by 6IXSTRINGJACK:

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Originally posted by JEWELSTAITEFAN:
Do you know what you plan to look for? I recently went through it with some people and was surprised how easily snookered some were.

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You'll have to be a bit more specific with that question because I don't know exactly what you're asking me.


Here's what I do know.

I'll get a 100% return on the first 5% I put in there beginning in November. This match is not vested until I work with the company for 3 more years after that. It's also not retroactive, so any additional money I put in this year will not be matched and it will only be on the first 5% going forward.

I have to pay SSI/MC on every dollar I make and nothing gets shielded from that.

Limits to how much you can put into a 401k in a year are nearly $3,000 more than I will make this year.

Anything over $12k will be taxed federally at 10%. Everything over $1k will be taxed at 4.8% for state and local. If I were to put everything over $12k in there from now until the end of the year, I'm looking at a tax savings of roughly $450.


My company match would only be a maximum of around $90 from when I'm eligible until the end of the year, and added with the tax savings if I put the rest of my money into the 401k would be about $540 earned.



The EIC won't be a thing for me this year. I was looking to see how much I could gain by putting the rest of my cash into the 401k for the year, but the EIC has a limit on both your taxable wages and your AGI, and it will be compared to whichever is higher, so even putting money away will still only net me a couple bucks here if anything at all.




If you have any suggestions, I'm more than happy to hear them.

Do Right, Be Right. :)

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I have been trying to get back to this for 2 weeks, and I am sorry for the delay. I was not ignoring of avoiding it, but would have been timed better a couple days earlier.

I will try to get this all in one post.


You will need to look for 2 kinds of funds. Hopefully you can find 2-4 candidates for each of the 2 kinds. One family of funds I looked at for friends had been reduced to about 170 funds (from 450ish), and I found 2 of one kind and 4 of the other. IIRC none of those was in the category they should have been in.

Sorry, but you will actually need to evaluate each one, I can almost guarantee just reading the prospectus and summary or rating will not work. I have found some of the very best funds in the "Moderate" and also "low" risk categories. One rule of thumb (which you need to ignore) is that the most aggressive Growth is by definition more volatile and risky. The reverse is not true. Being risky does not guarantee high growth. Some funds just lose money all the time, and only being Classified as aggressive do they seem like the risk is worth it, but it is not, there is no correlation. Once you look at they like I explain, you will find the prospectus humorous on many.

You are looking to take advantage of a Bear Market cycle. The last one was in 2008, following a peak in October 2007 and ending the slide in March 2009. The last before that was 2001, following a peak in 1st Quarter 2000, then starting Bear around April 2001, and already at least 17% down before 9/11.
You need to know how well a fund is likely to, or you hope it will, perform in the next Bear Market cycle.
Many people will tell you that what your stated goal is, IS NOT POSSIBLE. It is called Market Timing, and today's Financially Illiterate Fiscal Professionals have been spoon-fed the mantra that Market Timing does not exist, does not work, will not ever work, no matter how many savvy Market Timers implement it each time successfully.
Standard Disclaimer is past performance is not indicative of future results. Which is technically and legally correct. But you and I both know that THERE WILL BE PROFITABLE FUNDS during that time. So, do you throw your hat on the fund which failed the last 2 times to perform predictably? Or rather choose a fund which at least did well before, with no guarantee that it will absolutely repeat the performance? If you look at 5 different funds which did well during the last 2 Bears, might it be reasonable to imagine that at least 3-4 of them will do the same again? Even if you cannot predict which one will not do as well, that still seems like a decent wager.
The point here is: if your candidate fund did not exist in 2007, you cannot reasonably consider it for your use. You need to evaluate a fund's performance during an actual Bear Market. Looking at how any fund has performed in 9 1/2 years of no Bear is not going to expose the information you need.
So the only time period you are really looking at for your evaluation is 2007-2009, and hopefully 2001 as well (that time frame is harder to find, many funds have ended, and others started in the past 17 years).
So, discard any candidate which was not around in 2007, no matter how well it performed in the past 9 years.

Now here is a very important detail. You should reread this until you are certain you get it - I couldn't believe how hard this is for so many to understand.
When you look at the graphs of performance, they will all look the same.
If you look at 5 different funds all starting in 2006, looking at the graphs right next to each other, they will all look the same. The same dips there, the same peaks here. That year they all did the same, the other year they all did the different thing the same. Only minor differences in the graphs, the bumps and dips.
But they are not the same, and you absolutely must understand the difference.
If one fund spanned a 5% range during the past 12 years, the graph makers will enlarge/expand the vertical scale until the graph fills the size of the graph window. If another fund spanned an 80% range during the past 12 years, the graph makers will compress the vertical scale until it fits in the size of the graph window. So these 2 extremely unrelated performances will look the same on a standard graph.
You MUST check the scaling. Do the division, write down the figures. If a fund share dropped $4 during 2007-2009, then if it's 2007 value was $80 it dropped 5%. But if it's 2007 value was $5 then that same $4 drop represents an 80% drop. You must get this info to properly compare, and you are dreaming if you think they'll do this for you - they want you to give them money, not find out any truth about them.
Reread that until you are sure you got it. Everybody tells me they got it, but soon I see they did not get it.

I hope this is making sense.

OK, the 2 types of performance you are searching for. One is the funds which hardly dropped in value during the Bear Market. The other is the funds which plummeted deeply during the Bear Market.

Reminder: 2007 Dow peaked at 14,000 and 9 March 2009 was under 6,000 - a drop of something like 55% from prior peak value. 2000 Dow peaked at just under 12,000 and bottomed out around 7,300 - about 44% drop IIRC.

The first fund that you hope to use. A perfect example is a fund which cannot lose money, even in Bear Market. You won't find one like that, sorry. But if you look at 2008 and the average fund dropped more than 50% but the fund you are evaluating dropped only 1%, then that would be preferable, right? Sorry, you won't find that either. But you should be able to find a few which dropped less than 20% while the broader Market lost over 50%. Anything with less than 20% loss in 2008, keep in your pile of candidates until you've gone through them all, and can get picky and winnow down. I've found some that dropped 5-10% in 2008, and hopefully you will too. Unfortunately, if your workforce is Unionized, these are the funds the Unions get rid of, to ensure the worker gets screwed.
Keep in your pile the 3 or 4 best funds of this type, if they dropped 20% or less. The last 2 times I searched for friends, only found 1 or 2 each time.

The 2nd kind of fund you are searching for.
Big drop in value, percentage wise. I have found some that dropped over 80% in 2008. You want to identify these with the worst drops, which are still around today (because they rebounded). Even better if you can identify 2 subgroups of this type. One had a steep, surgical looking cut, and fast rebound/recovery. The other had a recovery which was more gradual.
For the purposes of diversification (not putting ALL your eggs in one basket), try to corral 4-6 of these.

You want to have all this figured out and planned BEFORE you need to know it, and have your plan in mind, and give it time to settle in your mind, so you are comfy with the whole works.

Now, how to use them.
The 1st type, doesn't lose a lot in deep Bear Market, you put your money in now. I think you get this, but ask if you need more information. For diversification, spread your money around in more than one of these - like the most money in the fund which lost the least, but a decent chunk in other funds that only dropped 10-20% when most funds dropped 50%. Remember, we cannot predict what will happen with certainty, so don't get stuck with ALL your money in a fund which suddenly doesn't behave like you were hoping it would.

The Deep droppers. When you look at these, you will see that they rebounded, most did so completely, even if it took years. This is standard behavior. Once a stock or fund price gets to a high or peak value, everybody understands it will again return there, unless it is not diversified. Mutual funds have many different companies which are invested in, so unless all of those companies go out of business, the fund will recover (unless managed badly, which you should have discovered when looking at 2007 and 2001 on their graphs).
So when Bear Market hits, and the prices drop but yours from the 1st type doesn't AS MUCH, the simple thing is to wait for the bottom, and transfer your money from those funds into the deep droppers, at their most-discounted prices.

Or, you can do it in 2 stages.
Let us use a round number, for illustration purposes. You have 100,000 in funds, and are not adding or removing any from your Tax-deferred fund Family.
In the example I just gave, your starting 100K drops to about 85K, and you move to funds which dropped about 66%. When those funds recover to prior values, your 85K will have become $255,000.

In a 2-stage approach, your starting 100K is still down to 85K. This is done. No way to avoid it, without a Zero-Loss type of fund. But you are thankful you only lost 15K instead of the 50K that everybody else did.
So you noticed some deep droppers which were steep climbers on the rebound, and you move your 85K into a few of them, when their values are about 75% down (25% of their prior peak value). Within a few months, or more, these funds have done a steep climb, not all of the way, but to 75% of their prior value, before their steepness shallows out. We are not afraid they won't return to their prior value, but the steep portion is what we were using them for. So the 85K is now at $255,000 as we transfer money to different funds.
These 2nd stage funds have a slower or delayed recovery timeline. So let's say they dropped about 60% to around 40% of their prior peak value. And now they have gradually rebounded to about 50%. But you were in the other steep climber funds. Now you buy in at 50% with your $255,000. In the next year or more to come, that 50% value will return to its prior peak value (100%), and your money will be $510,000 at that point.
So you will have multiplied your funds by 5 if that was your plan and you executed it.

Does all of that make sense?
Most of these events stretch over weeks and months at least, so it's not like you need to precisely transfer on a specific day, or track the Market Index funds every day. I used to check about once per month. So in 2001 I saw that the Bear trigger had happened in April, but I didn't notice until May. Shouldn't be a big deal.


Also, most funds have a symbol, or abbreviation, that you can use to track the value. Maybe check it every day for 10 days, or then check once a week for a month, just to get familiar. Then only whenever you are curious.

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Originally posted by SIGNYM:
JSF, I understand what you're saying: You need to "time the market" and pick the fast-risers and then switch to the "slow risers" after having make your investment at or near bottom.

Just a couple of comments and questions- wondering about your response.

1) Why pick a fund that will drop "only" 15% when you can have your $$$ in a guaranteed account that will lose no money at all? May as well have your money is a bank account which will only lose about 2% per year (inflation) and then buy stocks at an opportune time.

2) The stocks that I thought about buying the last financial lockup were bank stocks, since they took a real beating. Any reason not to buy bank stocks again?

3) These cycles have a tendency to run for 15 years. So the drop will be sudden but the rise will overall be much slower. A doubling or tripling of value over 15 years is great, but it's still only 10-15% per year ... which is great(!) but needs to be kept in perspective. So don't expect to double your money in three years. Agreed?

4) There are other investment classes "out there" besides stocks, including bonds, real estate/rental property/ farmland, currencies, precious metals, and commodities. (At this point I would not recommend buying stocks, real estate, or bonds until after a significant correction.)

I worry that we may not be seeing a "usual" stock market crash but that we may be moving into an entirely different investment realm of currency crisis, which will be signalled by a yield inversion. PHYSICAL DELIVERED GOLD (not "paper gold" or gold mining stocks) is the normal safe-haven for a currency crisis, but purchasing depressed actual foreign currency/bonds (eg Turkish lira/bonds) may be a good alternate strategy. Thoughts?

5) You seem reluctant to name funds names. It sure would be nice if you could let us in on the actual results of all of that research!

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Originally posted by JEWELSTAITEFAN:
Alert!!

Alert!!

Alert!!

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Originally posted by JEWELSTAITEFAN:
The most important number to watch for is 22,803.

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Dow closed Friday at 22,445. This is 16.3% off the Record All-Time High.

For those who have been trying to follow:
In the history of the Dow, this signals a Bear Market.
The last 2 times the Dow closed below 15% of it's current Record All-Time High were April 2001 and the end of January 2008.

If today's Market follows the historic model, then it will rebound for a bit, up to a range of 90% (24,145) to 95% (25,487) of the Record High. After that, it will fall down, most likely to 70% (18,778) or 40% (10,728) of the Record High.

In 2001, the bounce occurred during May and June, then declined in July. It got back down to 15% (10,000 Dow) in August. May is when I tried to get out, and I told my co-workers to do so as well. That was when the NYSE was a Pit, transfers done on paper.
In 2008, the transfers were done by computers, which are much faster than shouting humans. There was concern or uncertainty if the historic several months of bounce would be replaced with weeks or even days before the decline. I got out at the beginning of February 2008. But the bounce lasted thru Feb, March, and I think April, before the decline which ended on 9 March 2009.

So, if you believe in this model and the Bear has now been triggered, the Dow should bounce up 2-3,000 points, and then drop.
If you do not believe in this model and Bear has already been triggered before, then the Dow will continue to drop another 15-50% (4,025 - 13,414 points) from this point.

To be clear, I personally have no doubt that Bear Market is triggered. The only question is whether the bounce up is about to happen, or not -meaning the slide into Bear is already occurring right now.

So, the choice is this, for those in the Market: (1) if the bounce up is about to occur, you will be able to regain about 5-10% of your prior value, before selling and letting the stocks drop in value while you are not invested in them, or (2) sell now, absorbing the 16% loss as of Friday, and not worry about regaining 5-10% of value, but preventing further loss of surely at least another 15% of peak value and perhaps 50% more (which is 60% of current value).

After the Market bottoms out, you should then buy in at the cheap prices.


It looks like the Teen and Pothead Voters got their wish already, with the Market not waiting too long to respond.


In the past year, Dow has not closed below 23,500. Has not closed below 24,000 since May, until this past week.

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Originally posted by SIGNYM:
https://www.macrotrends.net/1319/dow-jones-100-year-historical-chart

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Originally posted by SIGNYM:
Cool JSF, thanks for the detailed answers.

https://www.macrotrends.net/1319/dow-jones-100-year-historical-chart

I just put this here for later discussion.

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Originally posted by SIGNYM:
These are better charts, because the previous one was logarithmic and visually compressed the highs. I'm interested in the duration of cycles.

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https://www.marketwatch.com/investing/index/djia/charts

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Originally posted by JEWELSTAITEFAN:
In 2007, Dow peaked at 14,000 in October, at the onset of the Rock-The-Vote Recession. It slid down to about 4,900 on 9 March 2009. This is a drop of about 65%. I think the Market recovered to 14,000 in 2013ish while Obamanomics labored to slow down and drag out any recovery....

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For instance, my best gain was probably 12% in 2 trading days, or 4 calendar days.- JSF

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Originally posted by SIGNYM:

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For instance, my best gain was probably 12% in 2 trading days, or 4 calendar days.- JSF

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That may be true, but now you're talking about day-trading, not "timing the market". You yourself said that you don't need to be to the right exact day for timing the market; what you implied was that it will work out if you get the big trends right.

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Originally posted by JEWELSTAITEFAN:

Dow closed Friday at 24,062.

Dow closed today at 23,327. This is 13.0% off the Record All-Time High.
Another 1% gain today.

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Way to go donnie...

T

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Originally posted by JEWELSTAITEFAN:

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Originally posted by SIGNYM:
JSF, I understand what you're saying: You need to "time the market" and pick the fast-risers and then switch to the "slow risers" after having make your investment at or near bottom.

Just a couple of comments and questions- wondering about your response.

1) Why pick a fund that will drop "only" 15% when you can have your $$$ in a guaranteed account that will lose no money at all? May as well have your money is a bank account which will only lose about 2% per year (inflation) and then buy stocks at an opportune time.

2) The stocks that I thought about buying the last financial lockup were bank stocks, since they took a real beating. Any reason not to buy bank stocks again?

3) These cycles have a tendency to run for 15 years. So the drop will be sudden but the rise will overall be much slower. A doubling or tripling of value over 15 years is great, but it's still only 10-15% per year ... which is great(!) but needs to be kept in perspective. So don't expect to double your money in three years. Agreed?

4) There are other investment classes "out there" besides stocks, including bonds, real estate/rental property/ farmland, currencies, precious metals, and commodities. (At this point I would not recommend buying stocks, real estate, or bonds until after a significant correction.)

I worry that we may not be seeing a "usual" stock market crash but that we may be moving into an entirely different investment realm of currency crisis, which will be signalled by a yield inversion. PHYSICAL DELIVERED GOLD (not "paper gold" or gold mining stocks) is the normal safe-haven for a currency crisis, but purchasing depressed actual foreign currency/bonds (eg Turkish lira/bonds) may be a good alternate strategy. Thoughts?

5) You seem reluctant to name funds names. It sure would be nice if you could let us in on the actual results of all of that research!

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5. Are you or kiki Government Employees, or is TSP your Retirement Program? No need to look it up, you would know if it was.

Most of the funds I checked I don't have the info. I might have some, from the family of about 170 after being reduced from about 450. These were from the Growth group, I think: JETSX, dodgx, jfivx, fcntx. For not losing during Bear: dipsx. Flmvx, jecix were rapid rebounders following deep loss. Ugsdx, cgtax were not available to us. Jilcx, pkc or pkcix would have been desirable, but the Union had removed them from our access.


1. Retirement Accounts. I think I was focusing on Tax-Deferred accounts, like 401K. If you can find funds allowed (by Law, or IRS) in a Retirement Account, which cost no fees to transfer among them, I would say go for it. The Fund Families giving the biggest kickbacks to companies have quite restrictive fund variety and seem heavily reliant upon lame Stock Funds.
Most companies offering "Matching" contributions require they go into these fund families, they don't just go into your bank account. Once they go into the fund of your choice, you control the transfers from one fund to another.
So naming these highly restrictive fund names would likely not apply to anybody else, since they would not have those fund names available.


2. Same as #1, I think. Unless I am misunderstanding, or you elaborate further.

3. I see many claim that the cycles are normally 7-8 years. I have no need to disagree there.
In 2001 the Dow bounced up to around 11,000 in May or June, back down to 10,000 in August, and then bottomed out in 2002 or maybe 2003. IIRC that was around 7,300ish. Market returned to 12,000 (new Record All-Time High) around 2005 or 2006, I think. So that is 2-4 years to return to prior levels. It dropped about 39%, and then gained 164% from the low point.
In 2007, Dow peaked at 14,000 in October, at the onset of the Rock-The-Vote Recession. It slid down to about 4,900 on 9 March 2009. This is a drop of about 65%. I think the Market recovered to 14,000 in 2013ish while Obamanomics labored to slow down and drag out any recovery. This is a gain of 286% in a period of 3-4 years. Then Election Day 2016 was a bit under 19,000 - or a 30% gain in about 3 Years. Then to 26,828 in Sept or Oct 2018, so about another 43% gain in less than 2 years. So the 9 year gain from 2009 to Sept was over 450%.
I don't see how I could agree with your claim, other than the 2001 Bear did not fall 50%, so mere recovery could not double the value.
Maybe you are not hearing the same categories of gain which I was talking about. Bear Market means loss, so exit to avoid loss (or get minor gains while everybody else loses). Recovery, gaining from deep loss to the same level of the prior All-Time High (this is practically guaranteed, quick, easy, no risk - except for Obamanomics strangling the recovery). Fresh, new, Record All-Time High territory gains - setting new milestones without dropping more than 15% (this is the most work, the most uncertainty, the most risk, the hardest to achieve).

4. First paragraph. Same as #1 I think, unless you elaborate otherwise.

Second paragraph. This is manipulating and finagling within the umbrella of Tax-Deferred Retirement Accounts. If the $US becomes the Wehrmacht, everybody has a lot more to worry about than a few gains here or there. To envision stability, how long has it been since the $US collapsed. The Rock-The-Vote Recession and Obamanomics generated more unemployment than the Great Depression, 80-90 years ago. So is the currency likely to remain stable for the remainder of your Retirement/Life, or not? You had a right/responsibility to educate the generation behind, and clearly we all failed, but the reverberations after you are gone are their problems which they already made their bed for.



If you were trying to concentrate on Retirement non-Tax-Deferred Accounts, then I would ask you this: if you pull out 10k in retirement, what would be your Income Tax on it (likely poverty level Taxes)? If you put 10k in your Retirement fund while you and your husband are both employed, what would be your Income Tax on it (Marginal Tax Rate)?

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Originally posted:

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Originally posted by JEWELSTAITEFAN:
Dow closed Friday at 24,062.

Dow closed today at 23,327. This is 13.0% off the Record All-Time High.
Another 1% gain today.

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US stocks post worst year in a decade as the S&P 500 falls more than 6% in 2018

Both indexes logged in their biggest annual losses since 2008, when they plunged 38.5 percent and 33.8 percent, respectively. The Nasdaq Composite lost 3.9 percent in 2018, its worst year in a decade, when it dropped 40 percent.

This year also marks the first time ever the S&P 500 posts a decline after rising in the first three quarters.

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Originally posted by 6IXSTRINGJACK:
You know anything about 529 plans, JSF?

I was thinking of starting one for my niece.

Do Right, Be Right. :)

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Originally posted by JEWELSTAITEFAN:

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Originally posted by 6IXSTRINGJACK:
You know anything about 529 plans, JSF?

I was thinking of starting one for my niece.

Do Right, Be Right. :)

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Education funds have been proven to be a pretty good scam. Wisconsin has EdVest, which my mom opened for each of her grandchildren. Perhaps originally having honest intention, the University has corrupted it (they think your money is their money).

If you find an isolated, non-corrupted 529 plan: if it is untaxed, then this reduces the amount of your pay going to the Government - good plan. If it eventually goes to your niece, this is better than Inheritance Taxes.

In the next 10 years, to you trust Lawmakers to not corrupt the rules? You've heard of Lawmakers confiscating Pensions? Corrupting the intent of Social Security?

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Originally posted by JO753:
MoLoKo! MoLoKo! (greek swear word)

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DUZ XaT SEM RiT TQ YQ? - Jubal Early

http://www.7532020.com]

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DUZ XaT SEM RiT TQ YQ? - Jubal Early

http://www.7532020.com .