MSM Worried about new Stock Market Bubble?
Just started seeing some media reports that we might be in the middle of another stock market bubble.
Just curious if everyone else agrees or not. It almost seems like the bubbles are coming faster but having less impact with each passing season.
Just curious if everyone else agrees or not. It almost seems like the bubbles are coming faster but having less impact with each passing season.
Comments
It's on CNN --- we probably don't have a stock market bubble yet.
There is little justification for the "froth" on WallStreet. The fundamentals are just not there. Might be a good time to "lock in" if you still on that roller coaster....
My point is that it will not plummet --- because people will buy on pullbacks.
It's worth your time to check this Market Ticker post out. It's something I have been tracking the last several months. If the current trend continues, it may be time to jump back into the market after October. It's interesting to note that this plan predicted getting out of the market before the big plunge late last year.
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A Long Term Investment Timing Signal That Works
Here's a hint kids, and this one's free - here's a long-term timing signal that, over the last 20 years, has never lost money.....
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.....The use of this strategy is simplicity itself - you buy the SPY (or a S&P 500 mutual fund such as VFINX) when the 20 week moving average crosses the 50 week moving average by more than 1%, and you go to cash (or treasuries) when the 20 week moving average crosses the 50week moving average in the downward direct by more than 1%.....
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You can do the 20 week (140 day) and the 50 week (350 day) moving average graphs on the Yahoo Finance web site.
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There's a myth perpetuated on that page:
If it was harder to get back to where you were, the market would be predictable in the other direction, and then it wouldn't be hard. So it's not harder. In an unpredictable market it's just as easy (or just as hard) to gain 100% as it is to lose 50%. It's easier to gain 100% than it is to lose 60%. All ignoring transaction costs.
Well, not necessarily. A market can be unpredictable in myriad ways. Here's a tidbit; the DOW will go up 172 points. I promise you it will happen. Now, if you only knew the day...
In whole, you are correct, however. If the market eventually ends up more or less flat, then it obviously made up that 100% just as easily as it shed the 50%.
http://stockcharts.com/charts/gallery.html?$SSEC
We are also going to see a flood of negative housing reports soon. And while wall street views the increase in SFH construction as positive, I suspect it is more of a negative as more inventory comes online as the air gets sucked out of the housing market in the winter.
I honestly tend to strongly doubt the parallel to the GD chart -- history usually rhymes instead of repeating exactly, and I'm not even sure if we're going to plunge back down to the March lows, but the stock market doesn't go straight up forever, and we're due for a correction.
I doubt anyone else actually expects stock market returns during the GD to exactly parallel returns for the next 5 years. Charts like that really have two different points. First, just because we've had a run-up doesn't mean the recession is over. The DOW had a nearly identical run-up and that signaled years of depression, so there's at least one historical proof to ignore the talking heads. Second, it helps put things in some kind of perspective (things are potentially really bad and they may not be anything worst really than America has gone through in the past).
If the two charts do continue to parallel, it's little more than a fascinating coincidence.
There were many mistakes that led to prolonging the GD. Time will tell what will be the impact of piling Cap'n Trade and Obamacare on top of Porkulus and the rest.
FWIW, replacing nouns of things you dislike with derogatory slang makes your sound highly partisan and like a generally untrustworthy source of information. Which, is unfortunate, because while it is vague and noncommittal, your statement does accurately reflect the high risks at stake in the aggregate of these legislations.