U.S. stocks in free fall

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huzaing
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Re: U.S. stocks in free fall

Post by huzaing »

incognito_man wrote: Thu Jan 27, 2022 2:00 pm Is there a thread anywhere where bogleheads get to predict the high and low on the S&P 500 for the calendar year? :)

Even it if dips below 3500 (which wouldn't surprise me whatsoever), it would would still be slightly overpriced. Honestly wouldn't shock me to see a drop to just below 3,000 sometime in the next year or two.

My high prediction: 4818.62
My low prediction: 3624.35
Below 3500? Why and how come? I can't comprehend how that would happen. That would wipe out so much
Triple digit golfer
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Re: U.S. stocks in free fall

Post by Triple digit golfer »

huzaing wrote: Thu Jan 27, 2022 2:38 pm
incognito_man wrote: Thu Jan 27, 2022 2:00 pm Is there a thread anywhere where bogleheads get to predict the high and low on the S&P 500 for the calendar year? :)

Even it if dips below 3500 (which wouldn't surprise me whatsoever), it would would still be slightly overpriced. Honestly wouldn't shock me to see a drop to just below 3,000 sometime in the next year or two.

My high prediction: 4818.62
My low prediction: 3624.35
Below 3500? Why and how come? I can't comprehend how that would happen. That would wipe out so much
If you can't comprehend a 27% drop from the high, you should reset your expectations. It's entirely possible that it will drop down closer to 2,500 than 3,500. Heck, even 2,500 would only be a 48% drop, which has happened twice in the last 20 years already, along with the 33% or so COVID crash.

That's three times in the last 20 years that a drop larger than you could comprehend has happened.
atdharris
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Re: U.S. stocks in free fall

Post by atdharris »

I think we would need more of a catalyst to drop 48% than rising interest rates. That's close to the GFC drop.
carminered2019
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Re: U.S. stocks in free fall

Post by carminered2019 »

in for 30K FSKAX !
AlphaLess
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Re: U.S. stocks in free fall

Post by AlphaLess »

quantAndHold wrote: Thu Jan 27, 2022 2:23 pm
AnalogKid22 wrote: Thu Jan 27, 2022 12:53 pm
Toth wrote: Thu Jan 27, 2022 6:54 am Why look for meaning in TA? Isn't it counter to boglehead principles?

(I realize its a thread for speculation, though)
This entire thread is basically counter to the Boglehead principles, specifically "tune out the noise", since the majority of the posts are in response to daily market swings and financial news, which we're supposed to ignore because "nobody knows nuthin".
Not every member of Bogleheads is a lockstep Boglehead. Even so, I doubt there are all that many people here who are actually trading on intraday market moves. Most people in the soaring and free fall threads are just here to blow off steam and have a chance to snark. I mean, it’s really tiresome to be earnest and helpful all the time.

Especially for those of us who really did lock in their IPS a decade ago and are busy staying the course, a little market volatility is always good for the entertainment value it provides.
Great comment!
I don't carry a signature because people are easily offended.
stocknoob4111
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Re: U.S. stocks in free fall

Post by stocknoob4111 »

carminered2019 wrote: Thu Jan 27, 2022 2:56 pm in for 30K FSKAX !
was going to exchange bonds for 10K VTSAX but chickened out and bought just 5K "to start", i'll buy in steps of 5K on the way down, although probably never works out in the end which is OK.
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HomerJ
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Re: U.S. stocks in free fall

Post by HomerJ »

atdharris wrote: Thu Jan 27, 2022 2:45 pm I think we would need more of a catalyst to drop 48% than rising interest rates. That's close to the GFC drop.
Sure, but something else could happen.

One should ALWAYS prepared for a 50% crash starting tomorrow.

Because it might.

This is always true.

Seems like I've been saying that for like at least 6-7 years... Does no one read my posts? :(
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
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AnalogKid22
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Re: U.S. stocks in free fall

Post by AnalogKid22 »

quantAndHold wrote: Thu Jan 27, 2022 2:23 pm
AnalogKid22 wrote: Thu Jan 27, 2022 12:53 pm
Toth wrote: Thu Jan 27, 2022 6:54 am Why look for meaning in TA? Isn't it counter to boglehead principles?

(I realize its a thread for speculation, though)
This entire thread is basically counter to the Boglehead principles, specifically "tune out the noise", since the majority of the posts are in response to daily market swings and financial news, which we're supposed to ignore because "nobody knows nuthin".
Not every member of Bogleheads is a lockstep Boglehead. Even so, I doubt there are all that many people here who are actually trading on intraday market moves. Most people in the soaring and free fall threads are just here to blow off steam and have a chance to snark. I mean, it’s really tiresome to be earnest and helpful all the time.

Especially for those of us who really did lock in their IPS a decade ago and are busy staying the course, a little market volatility is always good for the entertainment value it provides.
Yes, I know this thread is purely for entertainment and I comment on occasion. Just making a general statement that most of the posts in this thread probably aren't investing advice you want to act on, which anyone with a plan shouldn't do anyway, particularly if you do follow the principles.
invest4
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Re: U.S. stocks in free fall

Post by invest4 »

quantAndHold wrote: Thu Jan 27, 2022 2:23 pm I mean, it’s really tiresome to be earnest and helpful all the time.
Ha! Good fun.
Dry-Drink
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Re: U.S. stocks in free fall

Post by Dry-Drink »

atdharris wrote: Thu Jan 27, 2022 2:45 pm I think we would need more of a catalyst to drop 48% than rising interest rates. That's close to the GFC drop.
It's not even that unlikely, option prices show the market has priced in about a 7% chance of SPX hitting 2400 by Dec 2023. It takes a lot to stomach equity risk.
Triple digit golfer
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Re: U.S. stocks in free fall

Post by Triple digit golfer »

HomerJ wrote: Thu Jan 27, 2022 3:04 pm
atdharris wrote: Thu Jan 27, 2022 2:45 pm I think we would need more of a catalyst to drop 48% than rising interest rates. That's close to the GFC drop.
Sure, but something else could happen.

One should ALWAYS prepared for a 50% crash starting tomorrow.

Because it might.

This is always true.

Seems like I've been saying that for like at least 6-7 years... Does no one read my posts? :(
If you didn't post that, you'd only have 100 posts here. :P
SilverSmurfer
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Re: U.S. stocks in free fall

Post by SilverSmurfer »

BogleCPA wrote: Thu Jan 27, 2022 1:50 pm Payday tomorrow, hoping for no late-day rally today so that I can buy a bit cheaper.
This guarantees that tomorrow ends up (paydays for us too)
Up - yay for existing holdings
down - yay for new money

win-win :oops:
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vanbogle59
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Re: U.S. stocks in free fall

Post by vanbogle59 »

HomerJ wrote: Thu Jan 27, 2022 3:04 pm
atdharris wrote: Thu Jan 27, 2022 2:45 pm I think we would need more of a catalyst to drop 48% than rising interest rates. That's close to the GFC drop.
Sure, but something else could happen.

One should ALWAYS prepared for a 50% crash starting tomorrow.

Because it might.

This is always true.

Seems like I've been saying that for like at least 6-7 years... Does no one read my posts? :(
I read them.
Wait, you mean you were being serious?!?!?!?!
:D
andypanda
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Re: U.S. stocks in free fall

Post by andypanda »

"Seems like I've been saying that for like at least 6-7 years... Does no one read my posts?"

Sure, but that a 50% drop is possible is obvious to most of us, so we don't say anything.
The rest don't believe it's possible.

I've been prepared for a massive drop since my parents began telling me about the Depression in the '50s when I was little. Their experiences were scarier than the original Grimm fairy tales. Not the sanitized versions either.

Plus, I had an uncle born in 1915 who went to work for Dupont at age 18 and began buying stock prior to WWII. He passed on quite a bit of knowledge over the decades.

"By mid-November, 1929, the Dow had lost about half its value. The stock market was bearish, meaning that its value had declined by more than 20%. The Dow continued to lose value until the summer of 1932, when it bottomed out at 41 points, a stomach-churning 89% below its peak. The Dow didn't regain its pre-crash value until 1954." - www.fool.com/investing/stock-market/basics/crashes

Yeah, yeah, I know, it's different this time because the government will stop it from happening. Unless they can't or miscalculate. Be Prepared.
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HomerJ
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Re: U.S. stocks in free fall

Post by HomerJ »

Triple digit golfer wrote: Thu Jan 27, 2022 3:13 pm
HomerJ wrote: Thu Jan 27, 2022 3:04 pm
atdharris wrote: Thu Jan 27, 2022 2:45 pm I think we would need more of a catalyst to drop 48% than rising interest rates. That's close to the GFC drop.
Sure, but something else could happen.

One should ALWAYS prepared for a 50% crash starting tomorrow.

Because it might.

This is always true.

Seems like I've been saying that for like at least 6-7 years... Does no one read my posts? :(
If you didn't post that, you'd only have 100 posts here. :P
Well, that and my posts about how the long-term return of the stock market INCLUDES the crashes :)
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
rockstar
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Re: U.S. stocks in free fall

Post by rockstar »

AnalogKid22 wrote: Thu Jan 27, 2022 3:05 pm
quantAndHold wrote: Thu Jan 27, 2022 2:23 pm
AnalogKid22 wrote: Thu Jan 27, 2022 12:53 pm
Toth wrote: Thu Jan 27, 2022 6:54 am Why look for meaning in TA? Isn't it counter to boglehead principles?

(I realize its a thread for speculation, though)
This entire thread is basically counter to the Boglehead principles, specifically "tune out the noise", since the majority of the posts are in response to daily market swings and financial news, which we're supposed to ignore because "nobody knows nuthin".
Not every member of Bogleheads is a lockstep Boglehead. Even so, I doubt there are all that many people here who are actually trading on intraday market moves. Most people in the soaring and free fall threads are just here to blow off steam and have a chance to snark. I mean, it’s really tiresome to be earnest and helpful all the time.

Especially for those of us who really did lock in their IPS a decade ago and are busy staying the course, a little market volatility is always good for the entertainment value it provides.
Yes, I know this thread is purely for entertainment and I comment on occasion. Just making a general statement that most of the posts in this thread probably aren't investing advice you want to act on, which anyone with a plan shouldn't do anyway, particularly if you do follow the principles.
I wouldn't make investment decisions based on what's posted on an Internet forum. But this is a great sounding board for ideas and new approaches.

Now, will this market just capitulate already. Or is it going to be volatile burn down like in the early 2000s?
000
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Re: U.S. stocks in free fall

Post by 000 »

With LTT up significantly more than stocks are down we may be seeing newly created money buying stocks from smart money and smart money buying bonds. If true this drop is nowhere near over.
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vanbogle59
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Re: U.S. stocks in free fall

Post by vanbogle59 »

andypanda wrote: Thu Jan 27, 2022 3:18 pm "Seems like I've been saying that for like at least 6-7 years... Does no one read my posts?"

Sure, but that a 50% drop is possible is obvious to most of us, so we don't say anything.
The rest don't believe it's possible.

I've been prepared for a massive drop since my parents began telling me about the Depression in the '50s when I was little. Their experiences were scarier than the original Grimm fairy tales. Not the sanitized versions either.

Plus, I had an uncle born in 1915 who went to work for Dupont at age 18 and began buying stock prior to WWII. He passed on quite a bit of knowledge over the decades.

"By mid-November, 1929, the Dow had lost about half its value. The stock market was bearish, meaning that its value had declined by more than 20%. The Dow continued to lose value until the summer of 1932, when it bottomed out at 41 points, a stomach-churning 89% below its peak. The Dow didn't regain its pre-crash value until 1954." - www.fool.com/investing/stock-market/basics/crashes

Yeah, yeah, I know, it's different this time because the government will stop it from happening. Unless they can't or miscalculate. Be Prepared.
The problem with true doomsday prep is that you have to cover ALL the doomsdays.
What about hyperinflation? Massive unemployment? Government shutdown? Electricity outage? Gas shortages? Civil unrest....
(Insert inevitable bullets and butter comments here)

I am prepared for a 50% drop. I'm even prepared for 10 years of muted returns.
But I'm NOT prepared for 1929. Nor famine. Nor divorce.....
impatientInv
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Re: U.S. stocks in free fall

Post by impatientInv »

Yesterday comments from Powell, especially about the strength of economy and Labor market, it being able to withstand rate hikes implies - he wanted to see the market cool off.

Russia(OPEC), China and CoVID will have an higher impact on inflation that anything Fed will do IMO.
No individual stocks.
rockstar
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Re: U.S. stocks in free fall

Post by rockstar »

000 wrote: Thu Jan 27, 2022 3:26 pm With LTT up significantly more than stocks are down we may be seeing newly created money buying stocks from smart money and smart money buying bonds. If true this drop is nowhere near over.
If this drop was over, we'd already be back over the 200 day moving average. We've basically been below it for a week now with an intra day spike over it. The super hawkish Fed didn't help matters. Is the Fed put really gone? Maybe Apple will have good earnings.
Last edited by rockstar on Thu Jan 27, 2022 3:33 pm, edited 1 time in total.
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peskypesky
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Re: U.S. stocks in free fall

Post by peskypesky »

stocknoob4111 wrote: Thu Jan 27, 2022 11:53 am Small Caps are quickly heading toward BEAR market zone... ouch! my Portfolio is being set on fire as we speak :shock:

Small Caps have been a PAINFUL play in the last few years, insane volatility for an underperforming asset, this is going to have the worst Sharpe ratio in the century.
My Extended Market Index Fund (VXF) has been bleeding badly.
Back to Nov. 1, 2020 price. :(

https://finance.yahoo.com/quote/VXF?p=VXF
incognito_man
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Re: U.S. stocks in free fall

Post by incognito_man »

huzaing wrote: Thu Jan 27, 2022 2:38 pm
incognito_man wrote: Thu Jan 27, 2022 2:00 pm Is there a thread anywhere where bogleheads get to predict the high and low on the S&P 500 for the calendar year? :)

Even it if dips below 3500 (which wouldn't surprise me whatsoever), it would would still be slightly overpriced. Honestly wouldn't shock me to see a drop to just below 3,000 sometime in the next year or two.

My high prediction: 4818.62
My low prediction: 3624.35
Below 3500? Why and how come? I can't comprehend how that would happen. That would wipe out so much
No underlying reason other than market is historically wildly overpriced and drops of that magnitude are relatively common. A drop of that magnitude will almost assuredly happen again unless there are some significant societal/economic changes that are not foreseeable.

It's just a question of "when". And the "when's" have historically been sooner whilst sitting at the top than otherwise.
Marseille07
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Re: U.S. stocks in free fall

Post by Marseille07 »

rockstar wrote: Thu Jan 27, 2022 3:29 pm If this drop was over, we'd already be back over the 200 day moving average. We've basically been below is it for a week now with an intra day spike over it. The super hawkish Fed didn't help matters. Is the Fed put really gone? Maybe Apple will have good earnings.
I'm not even sure if there was the Fed put.

The bond purchases would print money, in a way. But it's not like you and I are receiving the proceeds. And while at it, they're still buying assets and yet we're almost in a -10% correction territory. So...are they even related, or were people simply buying on the incorrect notion that the Fed is somehow helping the market?
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gmaynardkrebs
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Re: U.S. stocks in free fall

Post by gmaynardkrebs »

HomerJ wrote: Thu Jan 27, 2022 3:04 pm
atdharris wrote: Thu Jan 27, 2022 2:45 pm I think we would need more of a catalyst to drop 48% than rising interest rates. That's close to the GFC drop.
One should ALWAYS prepared for a 50% crash starting tomorrow.
And ending when?
Last edited by gmaynardkrebs on Thu Jan 27, 2022 3:38 pm, edited 1 time in total.
andypanda
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Re: U.S. stocks in free fall

Post by andypanda »

"The problem with true doomsday prep is that you have to cover ALL the doomsdays."

I thought we were talking about being mentally prepared for a 50% drop. Be Prepared is the Boy Scout motto.


"The Scout Motto of the Scout movement, in various languages, has been used by millions of Scouts around the world since 1907. "
TheDoctor91
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Re: U.S. stocks in free fall

Post by TheDoctor91 »

AAPL going to single-handedly float the market.
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canadianbacon
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Re: U.S. stocks in free fall

Post by canadianbacon »

gmaynardkrebs wrote: Thu Jan 27, 2022 3:37 pm
HomerJ wrote: Thu Jan 27, 2022 3:04 pm
atdharris wrote: Thu Jan 27, 2022 2:45 pm I think we would need more of a catalyst to drop 48% than rising interest rates. That's close to the GFC drop.
One should ALWAYS prepared for a 50% crash starting tomorrow.
And ending when?
When enough have given up hope.
Bulls make money, bears make money, pigs get slaughtered.
rockstar
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Re: U.S. stocks in free fall

Post by rockstar »

Marseille07 wrote: Thu Jan 27, 2022 3:34 pm
rockstar wrote: Thu Jan 27, 2022 3:29 pm If this drop was over, we'd already be back over the 200 day moving average. We've basically been below is it for a week now with an intra day spike over it. The super hawkish Fed didn't help matters. Is the Fed put really gone? Maybe Apple will have good earnings.
I'm not even sure if there was the Fed put.

The bond purchases would print money, in a way. But it's not like you and I are receiving the proceeds. And while at it, they're still buying assets and yet we're almost in a -10% correction territory. So...are they even related, or were people simply buying on the incorrect notion that the Fed is somehow helping the market?
Rates are still super low. They now basically control the entire yield curve. High yield isn't even high.

When rates go down, asset values go up. They've been running that playbook for a long, long time. Now, they're unwinding two years of ridiculous accommodation that gave us ridiculous returns. Maybe this is simply mean revision assuming the Fed acts a certain way.
rockstar
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Re: U.S. stocks in free fall

Post by rockstar »

TheDoctor91 wrote: Thu Jan 27, 2022 3:40 pm AAPL going to single-handedly float the market.
It's a huge weight in both QQQ and VOO. I wonder what guidance they give. That's going to be key.
456M
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Re: U.S. stocks in free fall

Post by 456M »

TheDoctor91 wrote: Thu Jan 27, 2022 3:40 pm AAPL going to single-handedly float the market.
In other news Robinhood is now down to $10 in AH after earnings release, that's almost a 90% drop from ATH. Wow.
rockstar
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Re: U.S. stocks in free fall

Post by rockstar »

456M wrote: Thu Jan 27, 2022 3:44 pm
TheDoctor91 wrote: Thu Jan 27, 2022 3:40 pm AAPL going to single-handedly float the market.
In other news Robinhood is now down to $10 in AH after earnings release, that's almost a 90% drop from ATH. Wow.
When do they boot their vampire CEO?
km91
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Re: U.S. stocks in free fall

Post by km91 »

Marseille07 wrote: Thu Jan 27, 2022 3:34 pm
rockstar wrote: Thu Jan 27, 2022 3:29 pm If this drop was over, we'd already be back over the 200 day moving average. We've basically been below is it for a week now with an intra day spike over it. The super hawkish Fed didn't help matters. Is the Fed put really gone? Maybe Apple will have good earnings.
I'm not even sure if there was the Fed put.

The bond purchases would print money, in a way. But it's not like you and I are receiving the proceeds. And while at it, they're still buying assets and yet we're almost in a -10% correction territory. So...are they even related, or were people simply buying on the incorrect notion that the Fed is somehow helping the market?
A helpful rule of thumb is that anyone who's market outlook is predicated on what the Fed did or didn't do, or what it may or may not do, has no idea what role it plays in the economy or how it actually operates
Last edited by km91 on Thu Jan 27, 2022 3:53 pm, edited 1 time in total.
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HomerJ
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Re: U.S. stocks in free fall

Post by HomerJ »

gmaynardkrebs wrote: Thu Jan 27, 2022 3:37 pm
HomerJ wrote: Thu Jan 27, 2022 3:04 pm
atdharris wrote: Thu Jan 27, 2022 2:45 pm I think we would need more of a catalyst to drop 48% than rising interest rates. That's close to the GFC drop.
One should ALWAYS prepared for a 50% crash starting tomorrow.
And ending when?
I guess you haven't read my other posts over the years.

Still a very good question.... Likely to recover within 2-5 years, certainly possible could take 10-15 years, outside non-zero chance of never.

Planning around a 50% crash (or more) that might take a decade (or more) to recover means stock money should be long-term money.

One could still be 90/10 as a young investor, and just ride out the long crash (accumulating more shares at the lower prices along the way). But that young investor needs to be aware that the market could crash like that and take a long time to recover so they can mentally prepare for it.

Someone closer to retirement or in retirement will want a more conservative portfolio like 60/40 or 50/50 or 30/70, so they can pull money from the bonds/cash/CDs side if needed while waiting for the stock market to recover.

Once you are prepared for a 50% (or more) crash, you no longer have to worry about it.

It's like carrying around an umbrella all day... People come into this thread and start screaming how "it just started raining outside, and it might even turn into a downpour!", and you can just smile to yourself, and say "Well, good thing I already have an umbrella"
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
tvubpwcisla
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Re: U.S. stocks in free fall

Post by tvubpwcisla »

I wonder if anyone that is part of The Fed is a Boglehead?

:oops:
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vanbogle59
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Re: U.S. stocks in free fall

Post by vanbogle59 »

tvubpwcisla wrote: Thu Jan 27, 2022 3:47 pm I wonder if anyone that is part of The Fed is a Boglehead?

:oops:
Does Forrester count?
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HomerJ
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Re: U.S. stocks in free fall

Post by HomerJ »

vanbogle59 wrote: Thu Jan 27, 2022 3:48 pm
tvubpwcisla wrote: Thu Jan 27, 2022 3:47 pm I wonder if anyone that is part of The Fed is a Boglehead?

:oops:
Does Forrester count?
I think Forrester is a grad student doing a research study. Posts some crazy stuff, then documents all of our reactions to it.
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
Marseille07
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Re: U.S. stocks in free fall

Post by Marseille07 »

tvubpwcisla wrote: Thu Jan 27, 2022 3:47 pm I wonder if anyone that is part of The Fed is a Boglehead?

:oops:
I don't know if Chair Powell is a Boglehead but he was reportedly holding a Vanguard Total Stock Market Index Fund.
Dry-Drink
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Re: U.S. stocks in free fall

Post by Dry-Drink »

rockstar wrote: Thu Jan 27, 2022 3:42 pm They now basically control the entire yield curve.
No, I don't think so. The vast majority of Fed balance sheet is 2 years or shorter in duration. That's why we're seeing term spreads contracting and there's a good chance we even see an inversion; though the Fed can influence the short-end, the medium and long-end of the curve doesn't move much since it's mostly market-determined.
atdharris
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Re: U.S. stocks in free fall

Post by atdharris »

Don't worry, the market can still drop even with good Apple earnings. Microsoft also posted strong earnings and the market still dropped outside of Microsoft.
Vtsax100
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Re: U.S. stocks in free fall

Post by Vtsax100 »

Triple digit golfer wrote: Thu Jan 27, 2022 2:40 pm
huzaing wrote: Thu Jan 27, 2022 2:38 pm
incognito_man wrote: Thu Jan 27, 2022 2:00 pm Is there a thread anywhere where bogleheads get to predict the high and low on the S&P 500 for the calendar year? :)

Even it if dips below 3500 (which wouldn't surprise me whatsoever), it would would still be slightly overpriced. Honestly wouldn't shock me to see a drop to just below 3,000 sometime in the next year or two.

My high prediction: 4818.62
My low prediction: 3624.35
Below 3500? Why and how come? I can't comprehend how that would happen. That would wipe out so much
If you can't comprehend a 27% drop from the high, you should reset your expectations. It's entirely possible that it will drop down closer to 2,500 than 3,500. Heck, even 2,500 would only be a 48% drop, which has happened twice in the last 20 years already, along with the 33% or so COVID crash.

That's three times in the last 20 years that a drop larger than you could comprehend has happened.
If it goes to 2500 I will sell everything I own to buy vtsax.
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peskypesky
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Re: U.S. stocks in free fall

Post by peskypesky »

atdharris wrote: Thu Jan 27, 2022 3:56 pm Don't worry, the market can still drop even with good Apple earnings. Microsoft also posted strong earnings and the market still dropped outside of Microsoft.
The efficient market is pricing in all this good news by sinking. :D
drk
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Re: U.S. stocks in free fall

Post by drk »

atdharris wrote: Thu Jan 27, 2022 3:56 pm Don't worry, the market can still drop even with good Apple earnings. Microsoft also posted strong earnings and the market still dropped outside of Microsoft.
"It's a market of stocks, not a stock market." Or something.
A useful razor: anyone asking about speculative strategies on Bogleheads.org has no business using them.
rockstar
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Re: U.S. stocks in free fall

Post by rockstar »

Dry-Drink wrote: Thu Jan 27, 2022 3:56 pm
rockstar wrote: Thu Jan 27, 2022 3:42 pm They now basically control the entire yield curve.
No, I don't think so. The vast majority of Fed balance sheet is 2 years or shorter in duration. That's why we're seeing term spreads contracting and there's a good chance we even see an inversion; though the Fed can influence the short-end, the medium and long-end of the curve doesn't move much since it's mostly market-determined.
That's not true.

Here's the balance sheet:

https://www.federalreserve.gov/releases ... tm#h41tab1

Go to:

Maturity Distribution of Securities, Loans, and Selected Other Assets and Liabilities, January 26, 2022
000
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Re: U.S. stocks in free fall

Post by 000 »

rockstar wrote: Thu Jan 27, 2022 3:29 pm If this drop was over, we'd already be back over the 200 day moving average. We've basically been below it for a week now with an intra day spike over it. The super hawkish Fed didn't help matters. Is the Fed put really gone?
My guess is that this is a pretend to fight inflation exercise with an added bonus of buying up shares retail panic sold on the dip and continued training of retail to buy the dip for the ultimate crash.
rockstar
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Re: U.S. stocks in free fall

Post by rockstar »

000 wrote: Thu Jan 27, 2022 4:09 pm
rockstar wrote: Thu Jan 27, 2022 3:29 pm If this drop was over, we'd already be back over the 200 day moving average. We've basically been below it for a week now with an intra day spike over it. The super hawkish Fed didn't help matters. Is the Fed put really gone?
My guess is that this is a pretend to fight inflation exercise with an added bonus of buying up shares retail panic sold on the dip and continued training of retail to buy the dip for the ultimate crash.
It's feel like it's pushed up every day and then sold off at the end of the day. This feels like traders trading volatility with it slowly going down. Reminds me of early 2000s.
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peskypesky
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Re: U.S. stocks in free fall

Post by peskypesky »

000 wrote: Thu Jan 27, 2022 4:09 pm
rockstar wrote: Thu Jan 27, 2022 3:29 pm If this drop was over, we'd already be back over the 200 day moving average. We've basically been below it for a week now with an intra day spike over it. The super hawkish Fed didn't help matters. Is the Fed put really gone?
My guess is that this is a pretend to fight inflation exercise with an added bonus of buying up shares retail panic sold on the dip and continued training of retail to buy the dip for the ultimate crash.
Sounds plausible. I think the Fed is trying to buy themselves time and praying that supply chain issues subside. But the inflation in the economy is not just a supply chain issue IMO. Unlike most here, I think the pumping of money into the system after the crashes of 2008 and 2020 has contributed a lot to the problem. But I know this is a minority opinion here on Bogleheads, where most people seem to think monetary policy has no effect on the economy and the stock market.
000
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Re: U.S. stocks in free fall

Post by 000 »

rockstar wrote: Thu Jan 27, 2022 4:12 pm It's feel like it's pushed up every day and then sold off at the end of the day. This feels like traders trading volatility with it slowly going down. Reminds me of early 2000s.
I used to think this was dotcom 2.0 but I was wrong. This is a whole different beast related to TINA and Fed put logic.

Gold is down but corporate and EM govt bonds are up, suggesting neither liquidity crisis nor The End.

Brace for everything to start pumping again soon once enough retails have washed out.
Marseille07
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Re: U.S. stocks in free fall

Post by Marseille07 »

rockstar wrote: Thu Jan 27, 2022 4:12 pm It's feel like it's pushed up every day and then sold off at the end of the day. This feels like traders trading volatility with it slowly going down. Reminds me of early 2000s.
Actually overnight gap-up intraday-down has been happening for a long time: https://www.ccn.com/the-stock-markets-b ... -each-day/

These days it's more noticeable because the volatility is larger.
texasfight
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Re: U.S. stocks in free fall

Post by texasfight »

roth went from 100% cash to small cap value today

probably gonna die
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