‘A Powerful Signal of Recessions’ Has Wall Street’s Attention

Re:‘A Powerful Signal of Recessions’ Has Wall Street’s Atten... by timr on Monday June 25, 2018 @04:21PM (#17395472)

If you can't afford to lose it, you should put it in a savings account, a CD or another guaranteed asset until you've accumulated sufficient wealth that you can afford to take risks.

This is investing 101. Any financial planner will tell you the same thing. Most will tell you that you shouldn't have money in the stock market if you're going to need it within the next five years. Ten years is a better number.

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Re:‘A Powerful Signal of Recessions’ Has Wall Street’s Atten... by Retric on Monday June 25, 2018 @04:41PM (#17395623)

If your 20 you have up to 100 years worth of investing horizons to consider. Money put to retirement really is something you can lose while young. Investing in low enough to be zero yield instruments like CD's or savings accounts is terrible advice. As is treating investment savings as actual savings you can spend.

Sure, keeping ~3 years income outside of the market if your actually retired is a good idea idea. But, just because the market tanked does not mean you lost money. You have the same share of the same companies if the market goes up or down.

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Re:‘A Powerful Signal of Recessions’ Has Wall Street’s Atten... by timr on Monday June 25, 2018 @05:17PM (#17395869)

"If your 20 you have up to 100 years worth of investing horizons to consider. Money put to retirement really is something you can lose while young. Investing in low enough to be zero yield instruments like CD's or savings accounts is terrible advice. As is treating investment savings as actual savings you can spend."

If you need the money in five years, you should not be putting it in the stock market. If the money is truly "put to retirement" then you don't need it in five years, and you're just agreeing with me, pedantically.

The problem is that most of these HODL folks have never lived through a downturn, and will be crapping their pants when they realize that they really were secretly counting on the money being there. I've seen it happen twice now. The forums are filled with people "buying the dips" on 1% drops, but suddenly seeing a 30% short-term correction in their portfolio causes mass hysteria. The smart players have cash on hand, and are ready to buy -- precisely because they didn't "buy the dips".

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Re:‘A Powerful Signal of Recessions’ Has Wall Street’s Atten... by Retric on Tuesday June 26, 2018 @06:32AM (#17399352)

Cost dollar averaging already does a fairly good job of timing the market via retirement savings. Trying to beat that is a terrible idea, as being out of the market for a few days can easily cost you a year of growth.

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Re:‘A Powerful Signal of Recessions’ Has Wall Street’s Atten... by timr on Tuesday June 26, 2018 @03:24PM (#17403343)

Having money on the sidelines is not "timing the market".

Warren Buffet has $116 billion in cash on hand.

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Re:‘A Powerful Signal of Recessions’ Has Wall Street’s Atten... by Retric on Wednesday June 27, 2018 @11:35AM (#17408994)

He is also running an insurance company that needs cash on hand. On top of that they don't issue dividends only occasional stock buybacks which means they are going to accumulate cash by default.

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Re:‘A Powerful Signal of Recessions’ Has Wall Street’s Atten... by timr on Wednesday June 27, 2018 @06:05PM (#17412256)

Buffet said he would prefer to have $20Bn cash on hand, but has no good place to invest it. The reason? Companies are too expensive.

https://www.fool.com/investing/2018/03/04/warren-buffetts-11...

But sure, by your logic, he's "timing the market."

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