A time to EVALUATE your jitters

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Lawrence of Suburbia
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Re: A time to EVALUATE your jitters

Post by Lawrence of Suburbia »

The news worldwide is terrifying!! :(

I'm buying VTWAX (Vanguard Total World fund).
74% VTHRX/8% DODWX/12% TIAA Traditional/6% SWVXX
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NearlyRetired
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Re: A time to EVALUATE your jitters

Post by NearlyRetired »

Lawrence of Suburbia wrote: Thu Sep 01, 2022 12:09 pm The news worldwide is terrifying!! :(

I'm buying VTWAX (Vanguard Total World fund).
Is that (Vanuard Total End of World fund) :twisted: :twisted:
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Lawrence of Suburbia
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Re: A time to EVALUATE your jitters

Post by Lawrence of Suburbia »

NearlyRetired wrote: Thu Sep 01, 2022 1:45 pm
Lawrence of Suburbia wrote: Thu Sep 01, 2022 12:09 pm The news worldwide is terrifying!! :(

I'm buying VTWAX (Vanguard Total World fund).
Is that (Vanuard Total End of World fund) :twisted: :twisted:
Exactly! To very loosely paraphrase Mr. Bogle -- "Why search for a single disaster, when you can own the entire planetary apocalypse?" :happy
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Re: A time to EVALUATE your jitters

Post by LadyGeek »

Please stay on-topic.
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Fieldsy1024
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Re: A time to EVALUATE your jitters

Post by Fieldsy1024 »

Do you see the S and P 500 going up at all?
SantaClaraSurfer
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Re: A time to EVALUATE your jitters

Post by SantaClaraSurfer »

Opened my taxable account in October, 2018.

My Total Gain/Loss for everything invested in Equities/Bonds since that date is positive .05%, that's a whopping $5 return per $10,000 over 4 years.

I'm not jittery, just non-plussed. Literally.

I know that what this means is both that I've been fortunate to have more to invest in 2021/22 than previous years, and that I was lucky to rebalance in March 2020.

Staying the course. Investing once per month. Will rebalance per IPS. Nothing called for at this moment.
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Re: A time to EVALUATE your jitters

Post by mickeyd »

If Jack Bogle were still alive today, I wonder which of his wonderful STC phrases he would use to warn us?
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smooth_rough
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Re: A time to EVALUATE your jitters

Post by smooth_rough »

Dalio forcasting fed rate going to 4.5%, with another 20% drop in stock market.

Thoughts?
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9-5 Suited
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Re: A time to EVALUATE your jitters

Post by 9-5 Suited »

smooth_rough wrote: Fri Sep 16, 2022 4:38 pm Dalio forcasting fed rate going to 4.5%, with another 20% drop in stock market.

Thoughts?
In order for a prediction from Dalio or anyone else to register even 10 seconds worth of consideration, you first need to demonstrate that he has a past history of extreme accuracy in his predictions. And that’s not just finding one time he got it right. I mean go back and scour every publication for his printed predictions and compare them to real, measurable outcomes.

Absent that, I’ll be honest that it’s not only worthless but more than likely counterproductive for you to pay attention to it. His crystal ball is almost certainly as cloudy as anyone’s.

Doesn’t mean he will be wrong, just that anyone can put out statements like that and have a spotty record but conveniently ignore all their missed predictions.
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Re: A time to EVALUATE your jitters

Post by sabhen »

Nisi is one of the geniuses on this board I enjoy reading. His analysis is always well argued, rooted in deep understanding of markets and history and human psychology. There are many well known billionaires quoted by CNBC calling for 20% drop from here. The fed is driving an extremely fast tightening cycle trying to make up for their slow start. Don't fight the Fed. Accept it. The market will rebound as it has in the past. We are getting closer to the bottom than the top. I will use DCA over the next months to get to my target allocation.
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Re: A time to EVALUATE your jitters

Post by HomerJ »

SantaClaraSurfer wrote: Tue Sep 13, 2022 3:31 pm Opened my taxable account in October, 2018.

My Total Gain/Loss for everything invested in Equities/Bonds since that date is positive .05%, that's a whopping $5 return per $10,000 over 4 years.

I'm not jittery, just non-plussed. Literally.

I know that what this means is both that I've been fortunate to have more to invest in 2021/22 than previous years, and that I was lucky to rebalance in March 2020.

Staying the course. Investing once per month. Will rebalance per IPS. Nothing called for at this moment.
If it makes you feel any better, I started investing for real in 1998... 2 years, dot-com crash... and by 2003, I'm sure I was barely even (probably negative)

But those 5 years of savings from 1998-2003 are worth 500%+ more today
Last edited by HomerJ on Fri Sep 16, 2022 11:57 pm, edited 1 time in total.
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Re: A time to EVALUATE your jitters

Post by HomerJ »

smooth_rough wrote: Fri Sep 16, 2022 4:38 pm Dalio forcasting fed rate going to 4.5%, with another 20% drop in stock market.

Thoughts?
Dalio can forecast the future as well as I can... which means he can't.
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
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HomerJ
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Re: A time to EVALUATE your jitters

Post by HomerJ »

9-5 Suited wrote: Fri Sep 16, 2022 4:47 pm
smooth_rough wrote: Fri Sep 16, 2022 4:38 pm Dalio forcasting fed rate going to 4.5%, with another 20% drop in stock market.

Thoughts?
In order for a prediction from Dalio or anyone else to register even 10 seconds worth of consideration, you first need to demonstrate that he has a past history of extreme accuracy in his predictions. And that’s not just finding one time he got it right. I mean go back and scour every publication for his printed predictions and compare them to real, measurable outcomes.

Absent that, I’ll be honest that it’s not only worthless but more than likely counterproductive for you to pay attention to it. His crystal ball is almost certainly as cloudy as anyone’s.

Doesn’t mean he will be wrong, just that anyone can put out statements like that and have a spotty record but conveniently ignore all their missed predictions.
This.

It's not that hard to go back and look at past predictions. Almost everyone was wrong most of the time in the past.

It's really that easy.

Never ever just believe a prediction on the Internet from some financial person.
An economist is an expert who will know tomorrow why the things he predicted yesterday didn't happen today.
- Laurence J. Peter.
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
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Re: A time to EVALUATE your jitters

Post by ApeAttack »

HomerJ wrote: Fri Sep 16, 2022 11:57 pm
9-5 Suited wrote: Fri Sep 16, 2022 4:47 pm
smooth_rough wrote: Fri Sep 16, 2022 4:38 pm Dalio forcasting fed rate going to 4.5%, with another 20% drop in stock market.

Thoughts?
In order for a prediction from Dalio or anyone else to register even 10 seconds worth of consideration, you first need to demonstrate that he has a past history of extreme accuracy in his predictions. And that’s not just finding one time he got it right. I mean go back and scour every publication for his printed predictions and compare them to real, measurable outcomes.

Absent that, I’ll be honest that it’s not only worthless but more than likely counterproductive for you to pay attention to it. His crystal ball is almost certainly as cloudy as anyone’s.

Doesn’t mean he will be wrong, just that anyone can put out statements like that and have a spotty record but conveniently ignore all their missed predictions.
This.

It's not that hard to go back and look at past predictions. Almost everyone was wrong most of the time in the past.

It's really that easy.

Never ever just believe a prediction on the Internet from some financial person.
An economist is an expert who will know tomorrow why the things he predicted yesterday didn't happen today.
- Laurence J. Peter.
But... But... You're on the internet and just made a prediction that others can't predict the future reliably. :shock:

Who can one trust nowadays?? :confused
May all your index funds gain +0.5% today.
SantaClaraSurfer
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Re: A time to EVALUATE your jitters

Post by SantaClaraSurfer »

HomerJ wrote: Fri Sep 16, 2022 11:54 pm
SantaClaraSurfer wrote: Tue Sep 13, 2022 3:31 pm Opened my taxable account in October, 2018.

My Total Gain/Loss for everything invested in Equities/Bonds since that date is positive .05%, that's a whopping $5 return per $10,000 over 4 years.

I'm not jittery, just non-plussed. Literally.
If it makes you feel any better, I started investing for real in 1998... 2 years, dot-com crash... and by 2003, I'm sure I was barely even (probably negative)

But those 5 years of savings from 1998-2003 are worth 500%+ more today
Thanks for the perspective, valuable and appreciated!

(Esp. as my overall Equities/Bonds in our taxable brokerage account are now down -1.74% for my short 4 year history.)
gomer53
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Re: A time to EVALUATE your jitters

Post by gomer53 »

I agree with you. We are just going through a rough patch. Always think long term.
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Re: A time to EVALUATE your jitters

Post by 7eight9 »

gomer53 wrote: Mon Sep 19, 2022 1:49 pm I agree with you. We are just going through a rough patch. Always think long term.
“But this long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task, if in tempestuous seasons they can only tell us, that when the storm is long past, the ocean is flat again.”
John Maynard Keynes
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Re: A time to EVALUATE your jitters

Post by Sandtrap »

nisiprius wrote: Sun Aug 07, 2011 7:00 am I want to say this carefully. This is not an optimistic "stay the course" post and it's not a pessimistic "OMG do something" post. It's directed at people who are feeling very uncomfortable. I want to point out some things to think about, things that are hopefully truisms that everyone can see are correct once they're pointed out.

Your investment plan needs to be in tune with your own personal willingness to take financial risk. Your tolerance for financial risk is what it is. Only you know what it is. Nobody else can tell you what it should be. Different people are really and truly different. And your tolerance for financial risk is not necessarily the same as your tolerance for other kinds of risk.

You may not know what stock market risk is really like, and you may not know what your own risk tolerance really is. This is, if nothing else, a good opportunity to assess both.

What we have today is about a 10-15% decline in the S&P over the last month or so, coupled with a feeling of seismic shifts in the financial world. A sense that the earth is moving under our feet. A sense that events are happening that are going to make it into the history books. The general mood is summarized in this headline:

El-Erian: downgrade heralds new era

Heralds new era! Strong stuff. Let's not argue about whether it's true or not, let's agree that it feels that way right now. Like there's been a turning point, a division between an old era and a new era, and therefore past history is no longer a guide to the future.

And here's my point: it always feels that way. That's always what a big downturn feels like. It's not a number, 10% or 15%. It's a sense that there's been a break, the ground has shifted, the rules have changed.

We love drama and after the fact the reality often turns out to be boring. Imagine thinking that, see, it wasn't so bad! But that's later. And sometimes it is a turning point and sometimes it is that bad.

When you're deciding what your risk tolerance is, it's not a tolerance for the number 10 or the number 15 or the number 25. It's not a tolerance for an "A" turning into a "+". It's a tolerance for accepting genuinely-scary, nothing-like-this-has-ever-happened-before, heralds-a-new-era news events.

Now, the next set of truisms. Nobody knows what's going to happen. No, really. I don't care what the best experts are saying or what the futures do or what happens tonight in Asia. On Monday, stocks might shoot right back up. Or they might plunge some more. Or they might diddle around for weeks leaving us all on tenterhooks and then plunge some more, Or not.

We see this:

Image

Well, we really don't know what will happen. It might be almost nothing... it might be like the start of this period in 1998 and it could bounce back in a few months.

Image

It might be the start of another 50% plunge like 2008-2009. Awful, but over in a couple of years.

Image

It might be like the start of this period in 1937 when stocks plunged about 50% as in 2008-9, but didn't come back for about a decade. (I'm using a long-lived stock market mutual fund as a proxy for "the market," but it's close enough).

Image

It might be like Japan in 1990, down for two decades and still down.

Image

But not to overweight the pessimism, let me add one more chart. Where's last week's plunge? When I expand the scale, it's actually there. The data being plotted includes it. But apparently it's so tiny it just gets rounded off or vanishes at screen pixel resolution!

Image

The point is, the last few weeks were a time when some risk showed up, and your job is to process it. The temptation is to deal with the discomfort by choosing a prediction. Don't. Your job is to confront the reality of that uncertainty, that you do not know what will happen, and can only make the roughest guesses as to the likelihood of all these scenarios.

Hopefully, you can say "well, yeah, I knew all that. I'd much rather see the market go up and I feel anxious, but I'm able to stay the course."

Unfortunately, if you look at all this and conclude that your exposure to the stock market is higher than your risk tolerance, there aren't any good options. It is absolutely a personal decision. The only sure way to reduce stock market risk substantially is to cut back on your stock allocation. Diversification, fiddling around with different flavors of stock, it's all bandaids. When stocks plunge, they plunge. So the S&P drops 50% and your portfolio drops 46%, big deal.

And when the stock market is falling, you can't cut back on your stock market risk without locking in a loss. It's a tough one and a personal decision. You absolutely have to measure one against the other. It's crazy to even suggest a course of action to anyone else and I'm not going to try.

What I'm saying is that this is a good time for evaluation. The risk is here. Don't exaggerate it--we all love drama, but reality is usually more boring than we expect. Don't brush it aside, look it in the eye as carefully as you can. And then look at how you really feel about it--not how you'd like to feel or how you think you're supposed to feel.

And one final thought. If we're lucky, and the stock market comes back at least part way and seems to stabilize for a while... or if it comes roaring back and soars (yes, that' could happen, too)... don't forget how you feel right now. If you feel that you are close to the edge of your risk tolerance right now, then you have too much in stocks. If you manage to tough it out and we get a calm spell, don't forget how you feel now and at least consider making an adjustment then.
Incredible post and hard work still applicable today.

thank you!
j🌴
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smooth_rough
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Re: A time to EVALUATE your jitters

Post by smooth_rough »

Don't fight the fed means what to you?

* buy I bonds
* buy TIPS
* DCA
* other

Would be more interested in comments regarding "other".
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Re: A time to EVALUATE your jitters

Post by ddbtoth »

smooth_rough wrote: Tue Sep 13, 2022 3:09 pm Panic selling today because inflation was forcast to be 8.0%, but actually turned out to be 8.3% ?

Am I missing something?

smh
Make sure you lock in your loses?
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Re: A time to EVALUATE your jitters

Post by john0608 »

dont fight the fed to me means
- expect equity prices to continue to fall
- have your AA so that you don't need to sell equities when they are down - sell your fixed if you need cash
- hopefully your fixed is not mired in a falling bond fund but is in actual bonds, t-bills, i-bonds
- keep laddering t-bills as i rates rise
- wait for the rebound in 12 to 24 months
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Youngblood
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Re: A time to EVALUATE your jitters

Post by Youngblood »

7eight9 wrote: Mon Sep 19, 2022 2:16 pm
gomer53 wrote: Mon Sep 19, 2022 1:49 pm I agree with you. We are just going through a rough patch. Always think long term.
“But this long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task, if in tempestuous seasons they can only tell us, that when the storm is long past, the ocean is flat again.”
John Maynard Keynes
Especially applicable to us oldies.
"I made my money by selling too soon." | Bernard M. Baruch
AA40
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Re: A time to EVALUATE your jitters

Post by AA40 »

Very nice charts and analysis, however why did you change the last chart to a logarithmic scale? It bothers me A LOT when people use different chart scales to try to prove a point. It's not needed and can be seen as deceiving!
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Charles Joseph
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Re: A time to EVALUATE your jitters

Post by Charles Joseph »

I've been joyfully shoveling money into the market all year. Happy as a clam.

Now, I'm getting jitters.
"The big money is not in the buying and selling, but in the waiting." - Charles Munger
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Re: A time to EVALUATE your jitters

Post by Wanderingwheelz »

Charles Joseph wrote: Tue Sep 27, 2022 5:00 pm I've been joyfully shoveling money into the market all year. Happy as a clam.

Now, I'm getting jitters.
Without jitters, how would you know you’re nearing the bottom?
Being wrong compounds forever.
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Charles Joseph
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Re: A time to EVALUATE your jitters

Post by Charles Joseph »

Wanderingwheelz wrote: Tue Sep 27, 2022 6:12 pm
Charles Joseph wrote: Tue Sep 27, 2022 5:00 pm I've been joyfully shoveling money into the market all year. Happy as a clam.

Now, I'm getting jitters.
Without jitters, how would you know you’re nearing the bottom?
Nobody knows nuthin'.
"The big money is not in the buying and selling, but in the waiting." - Charles Munger
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Re: A time to EVALUATE your jitters

Post by LadyGeek »

Several off-topic posts were removed. Please don't use this thread for discussions of daily market activity, i.e. Re: U.S. stocks in free fall.
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dvvader
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Re: A time to EVALUATE your jitters

Post by dvvader »

Go outside and breathe some fresh air, touch some grass, and enjoy all creation's beauty.

Spend time with family and friends. Go out and do something together.

Open a bottle of wine or crack open a cold beer, kick up your feet, and watch your favorite movie or read a good book.

Turn off the news, get off social media, and cut off access to wherever else you may access your fear propaganda (even if it is the Bogleheads forum).

Do whatever it takes to get your mind off the market and allow you to sleep well at night. Control what you can control, and recognize that market movements are completely out of your control. Everything will work itself out, eventually.

If the above doesn't work, reduce your stock allocation by 10% and repeat the process! :sharebeer
Bogleheads® emphasize regular saving, broad diversification, and sticking to one's investment plan regardless of market conditions.
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Re: A time to EVALUATE your jitters

Post by meadowrue »

dvvader wrote: Tue Sep 27, 2022 8:21 pm Go outside and breathe some fresh air, touch some grass, and enjoy all creation's beauty.

Spend time with family and friends. Go out and do something together.

Open a bottle of wine or crack open a cold beer, kick up your feet, and watch your favorite movie or read a good book.

Turn off the news, get off social media, and cut off access to wherever else you may access your fear propaganda (even if it is the Bogleheads forum).

Do whatever it takes to get your mind off the market and allow you to sleep well at night. Control what you can control, and recognize that market movements are completely out of your control. Everything will work itself out, eventually.

If the above doesn't work, reduce your stock allocation by 10% and repeat the process! :sharebeer
This is fantastic advice. Cheers! :sharebeer
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Ed 2
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Re: A time to EVALUATE your jitters

Post by Ed 2 »

Keep buying VT everyday now . Somebody stop me! :sharebeer
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Re: A time to EVALUATE your jitters

Post by H20SnoSki »

john0608 wrote: Wed Sep 21, 2022 7:58 am dont fight the fed to me means
- expect equity prices to continue to fall


Fisher published a nice short piece showing that the correlation between rising rates and falling equities happens about half the time. Why does everyone assume otherwise?

https://www.fisherinvestments.com/en-us ... dium=email
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Re: A time to EVALUATE your jitters

Post by AnnetteLouisan »

Ed 2 wrote: Tue Sep 27, 2022 8:32 pm Keep buying VT everyday now . Somebody stop me! :sharebeer
You think the market is oversold, right? I do too although of course I am just guessing. I have a buy order in too for some total market. I don’t feel very jittery. For me, it’s money I don’t expect to need for 10-15 years.

I also want some one and two year treasuries at these 4 percent yields (although they are negative real right now) but I’m not sure how much to buy or if I should wait until the hikes are over. I guess bird in hand and all, I can buy some now and some later. I’ll try buying on Fidelity if I can figure out how. So far I only bought on TD.
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Re: A time to EVALUATE your jitters

Post by Silverado »

AA40 wrote: Sun Sep 25, 2022 1:39 pm Very nice charts and analysis, however why did you change the last chart to a logarithmic scale? It bothers me A LOT when people use different chart scales to try to prove a point. It's not needed and can be seen as deceiving!
It is part of the point. The daily linear data we generally see in the news is unfortunately the thing a lot of folks react to. The final view of seeing on a log scale is how it should be evaluated.
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Re: A time to EVALUATE your jitters

Post by Florida Orange »

I too have been shoveling money into the market all year, happy as a clam, and I don't have the jitters. But I've been buying bonds. I was under the impression that if you reinvest the dividends from the bond funds then, in the long run, rising rates are a good thing. Perhaps I've been misinformed and my lack of jitters is ill-founded.
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Re: A time to EVALUATE your jitters

Post by matti »

dvvader wrote: Tue Sep 27, 2022 8:21 pm Go outside and breathe some fresh air, touch some grass, and enjoy all creation's beauty.

Spend time with family and friends. Go out and do something together.

Open a bottle of wine or crack open a cold beer, kick up your feet, and watch your favorite movie or read a good book.

Turn off the news, get off social media, and cut off access to wherever else you may access your fear propaganda (even if it is the Bogleheads forum).

Do whatever it takes to get your mind off the market and allow you to sleep well at night. Control what you can control, and recognize that market movements are completely out of your control. Everything will work itself out, eventually.

If the above doesn't work, reduce your stock allocation by 10% and repeat the process! :sharebeer
I really like your comment about turning off the news. I stopped watching the news regularly about two years ago and it has done wonders for my mental health. I might tune in to the news 2-3x/month now, but only for a few minutes.
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Re: A time to EVALUATE your jitters

Post by Stinky »

matti wrote: Thu Sep 29, 2022 9:43 am
dvvader wrote: Tue Sep 27, 2022 8:21 pm Go outside and breathe some fresh air, touch some grass, and enjoy all creation's beauty.

Spend time with family and friends. Go out and do something together.

Open a bottle of wine or crack open a cold beer, kick up your feet, and watch your favorite movie or read a good book.

Turn off the news, get off social media, and cut off access to wherever else you may access your fear propaganda (even if it is the Bogleheads forum).

Do whatever it takes to get your mind off the market and allow you to sleep well at night. Control what you can control, and recognize that market movements are completely out of your control. Everything will work itself out, eventually.

If the above doesn't work, reduce your stock allocation by 10% and repeat the process! :sharebeer
I really like your comment about turning off the news. I stopped watching the news regularly about two years ago and it has done wonders for my mental health. I might tune in to the news 2-3x/month now, but only for a few minutes.
I think that locking the “soaring” and “free fall” threads did a lot for my mental health.
Retired life insurance company financial executive who sincerely believes that ”It’s a GREAT day to be alive!”
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Re: A time to EVALUATE your jitters

Post by Ed 2 »

AnnetteLouisan wrote: Wed Sep 28, 2022 4:41 am
Ed 2 wrote: Tue Sep 27, 2022 8:32 pm Keep buying VT everyday now . Somebody stop me! :sharebeer
You think the market is oversold, right? I do too although of course I am just guessing. I have a buy order in too for some total market. I don’t feel very jittery. For me, it’s money I don’t expect to need for 10-15 years.

I also want some one and two year treasuries at these 4 percent yields (although they are negative real right now) but I’m not sure how much to buy or if I should wait until the hikes are over. I guess bird in hand and all, I can buy some now and some later. I’ll try buying on Fidelity if I can figure out how. So far I only bought on TD.
I don’t change my mind. Just adding to the same positions and adding even more during times like this. I never think it oversold or overvalued. I just do the opposite what crowd does, that’s all.
"The fund industry doesn't have a lot of heroes, but he (Bogle) is one of them," Russ Kinnel
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AnnetteLouisan
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Re: A time to EVALUATE your jitters

Post by AnnetteLouisan »

Ed 2 wrote: Fri Sep 30, 2022 4:14 pm
AnnetteLouisan wrote: Wed Sep 28, 2022 4:41 am
Ed 2 wrote: Tue Sep 27, 2022 8:32 pm Keep buying VT everyday now . Somebody stop me! :sharebeer
You think the market is oversold, right? I do too although of course I am just guessing. I have a buy order in too for some total market. I don’t feel very jittery. For me, it’s money I don’t expect to need for 10-15 years.

I also want some one and two year treasuries at these 4 percent yields (although they are negative real right now) but I’m not sure how much to buy or if I should wait until the hikes are over. I guess bird in hand and all, I can buy some now and some later. I’ll try buying on Fidelity if I can figure out how. So far I only bought on TD.
I don’t change my mind. Just adding to the same positions and adding even more during times like this. I never think it oversold or overvalued. I just do the opposite what crowd does, that’s all.
Yes I’m shifting gears now and will be buying more in taxable. Enough pussyfooting around at this point (on my part). I’ve felt almost no jitters all year (odd….). It will be nice if it goes up eventually and from these levels I’d think it will.
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Re: A time to EVALUATE your jitters

Post by Ed 2 »

AnnetteLouisan wrote: Fri Sep 30, 2022 4:43 pm
Ed 2 wrote: Fri Sep 30, 2022 4:14 pm
AnnetteLouisan wrote: Wed Sep 28, 2022 4:41 am
Ed 2 wrote: Tue Sep 27, 2022 8:32 pm Keep buying VT everyday now . Somebody stop me! :sharebeer
You think the market is oversold, right? I do too although of course I am just guessing. I have a buy order in too for some total market. I don’t feel very jittery. For me, it’s money I don’t expect to need for 10-15 years.

I also want some one and two year treasuries at these 4 percent yields (although they are negative real right now) but I’m not sure how much to buy or if I should wait until the hikes are over. I guess bird in hand and all, I can buy some now and some later. I’ll try buying on Fidelity if I can figure out how. So far I only bought on TD.
I don’t change my mind. Just adding to the same positions and adding even more during times like this. I never think it oversold or overvalued. I just do the opposite what crowd does, that’s all.
Yes I’m shifting gears now and will be buying more in taxable. Enough pussyfooting around at this point (on my part). I’ve felt almost no jitters all year (odd….). It will be nice if it goes up eventually and from these levels I’d think it will.
You will be fine as longer you don’t sell. Money that I invest in I don’t need next 10-15years or more . Everyone is talking about how bonds are attractive now or how to buy “ defensive stocks “ . Just laughable and pathetic how humans predictably reactive during bear markets. Same I remember during last big bear market 2007-2009 . If this bear will go well into 2023 , so be it . Have nothing but time and buying more, equity’s only. I never understood bonds , not my thing.
"The fund industry doesn't have a lot of heroes, but he (Bogle) is one of them," Russ Kinnel
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AnnetteLouisan
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Re: A time to EVALUATE your jitters

Post by AnnetteLouisan »

Ed 2 wrote: Fri Sep 30, 2022 5:04 pm
AnnetteLouisan wrote: Fri Sep 30, 2022 4:43 pm
Ed 2 wrote: Fri Sep 30, 2022 4:14 pm
AnnetteLouisan wrote: Wed Sep 28, 2022 4:41 am
Ed 2 wrote: Tue Sep 27, 2022 8:32 pm Keep buying VT everyday now . Somebody stop me! :sharebeer
You think the market is oversold, right? I do too although of course I am just guessing. I have a buy order in too for some total market. I don’t feel very jittery. For me, it’s money I don’t expect to need for 10-15 years.

I also want some one and two year treasuries at these 4 percent yields (although they are negative real right now) but I’m not sure how much to buy or if I should wait until the hikes are over. I guess bird in hand and all, I can buy some now and some later. I’ll try buying on Fidelity if I can figure out how. So far I only bought on TD.
I don’t change my mind. Just adding to the same positions and adding even more during times like this. I never think it oversold or overvalued. I just do the opposite what crowd does, that’s all.
Yes I’m shifting gears now and will be buying more in taxable. Enough pussyfooting around at this point (on my part). I’ve felt almost no jitters all year (odd….). It will be nice if it goes up eventually and from these levels I’d think it will.
You will be fine as longer you don’t sell. Money that I invest in I don’t need next 10-15years or more . Everyone is talking about how bonds are attractive now or how to buy “ defensive stocks “ . Just laughable and pathetic how humans predictably reactive during bear markets. Same I remember during last big bear market 2007-2009 . If this bear will go well into 2023 , so be it . Have nothing but time and buying more, equity’s only. I never understood bonds , not my thing.
Same here. I’m only investing money I (knock wood) don’t expect to need for 10-15 years, if ever. My safe money (pension, SS, treasuries, other) should cover my needs and I’m still working. I love bonds though. It’s equities I was resistant to. But I still invested through tax deferred plans. I have no plans to sell any time soon.
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Re: A time to EVALUATE your jitters

Post by Florida Orange »

For me, bonds are what matter; stocks are just a way to buy more bonds. If stocks go up I sell some and use the money to buy more bonds, if they don't I just leave everything alone. Stocks are simply a mechanism which, from time to time, allows me to buy more bonds. And the purpose of bonds is to generate interest. Thus, fluctuations in the stock market are two steps removed from what I really care about. I think this, more than anything else, explains my lack of jitters.
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Re: A time to EVALUATE your jitters

Post by Leesbro63 »

Florida Orange wrote: Sat Oct 01, 2022 8:26 am For me, bonds are what matter; stocks are just a way to buy more bonds. If stocks go up I sell some and use the money to buy more bonds, if they don't I just leave everything alone. Stocks are simply a mechanism which, from time to time, allows me to buy more bonds. And the purpose of bonds is to generate interest. Thus, fluctuations in the stock market are two steps removed from what I really care about. I think this, more than anything else, explains my lack of jitters.
Fascinating. All my years here and I've never seen anyone with this type of thinking.
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Re: A time to EVALUATE your jitters

Post by AnnetteLouisan »

Florida Orange wrote: Sat Oct 01, 2022 8:26 am For me, bonds are what matter; stocks are just a way to buy more bonds. If stocks go up I sell some and use the money to buy more bonds, if they don't I just leave everything alone. Stocks are simply a mechanism which, from time to time, allows me to buy more bonds. And the purpose of bonds is to generate interest. Thus, fluctuations in the stock market are two steps removed from what I really care about. I think this, more than anything else, explains my lack of jitters.
Which bonds do you like? Munis, treasuries, corporates? I’m kind of partial to bonds myself (love the fixed part of fixed income and the historical solidity, plus the fact that some are guaranteed by a parent company, as well as the preference over equity holders in bankruptcy, the convertibility of some bonds to equity at the option of the holder, and the inclination of US courts to protect bond holders…. Need I go on?) and my AA is about 20/80 right now, but am increasing my equity exposure.
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Re: A time to EVALUATE your jitters

Post by Florida Orange »

Leesbro63 - I can't tell if you're being sarcastic.
Annetlouisan - I'm all munis because of my tax bracket. I have a preference for long term munis because the interest is much more stable and, as I said above, that's what I care about.
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Re: A time to EVALUATE your jitters

Post by dbr »

Leesbro63 wrote: Sat Oct 01, 2022 8:40 am
Florida Orange wrote: Sat Oct 01, 2022 8:26 am For me, bonds are what matter; stocks are just a way to buy more bonds. If stocks go up I sell some and use the money to buy more bonds, if they don't I just leave everything alone. Stocks are simply a mechanism which, from time to time, allows me to buy more bonds. And the purpose of bonds is to generate interest. Thus, fluctuations in the stock market are two steps removed from what I really care about. I think this, more than anything else, explains my lack of jitters.
Fascinating. All my years here and I've never seen anyone with this type of thinking.
Well, there is this:

Groucho was once walking around the New York Stock Exchange when one of the traders on the floor asked him: “Groucho, how do you invest your money?” Groucho answered: “All in bonds.” The trader asked: “But Groucho, they don’t pay much return.” Groucho said: “They do when you have a lot of em!”

And there is this from Suzi Orman:

"Turning to your own finances, when we talked at the end of 2018, you were investing heavily in cannabis stocks. Is that still the case?

No. Now I’m invested almost totally in the United States. The majority of my money is still in municipal bonds, though I have a lot of money now in the stock market because I’ve made considerably more money, and bond interest rates were low. So I put money into stocks. Two days ago, I loaded up on more Chinese stocks."

My parents downsized a home and moved to a rental. They put the proceeds in T bills and paid the rent from that for years. Of course they were getting 6% in those days.
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Re: A time to EVALUATE your jitters

Post by Florida Orange »

dbr - living within your means is foundational to all this. To paraphrase Vince Lombardi, not running out of money isn't everything, it's the only thing.
Robin1234
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Re: A time to EVALUATE your jitters

Post by Robin1234 »

Sandtrap wrote: Tue Sep 20, 2022 11:02 am
nisiprius wrote: Sun Aug 07, 2011 7:00 am I want to say this carefully. This is not an optimistic "stay the course" post and it's not a pessimistic "OMG do something" post. It's directed at people who are feeling very uncomfortable. I want to point out some things to think about, things that are hopefully truisms that everyone can see are correct once they're pointed out.

Your investment plan needs to be in tune with your own personal willingness to take financial risk. Your tolerance for financial risk is what it is. Only you know what it is. Nobody else can tell you what it should be. Different people are really and truly different. And your tolerance for financial risk is not necessarily the same as your tolerance for other kinds of risk.

You may not know what stock market risk is really like, and you may not know what your own risk tolerance really is. This is, if nothing else, a good opportunity to assess both.

What we have today is about a 10-15% decline in the S&P over the last month or so, coupled with a feeling of seismic shifts in the financial world. A sense that the earth is moving under our feet. A sense that events are happening that are going to make it into the history books. The general mood is summarized in this headline:

El-Erian: downgrade heralds new era

Heralds new era! Strong stuff. Let's not argue about whether it's true or not, let's agree that it feels that way right now. Like there's been a turning point, a division between an old era and a new era, and therefore past history is no longer a guide to the future.

And here's my point: it always feels that way. That's always what a big downturn feels like. It's not a number, 10% or 15%. It's a sense that there's been a break, the ground has shifted, the rules have changed.

We love drama and after the fact the reality often turns out to be boring. Imagine thinking that, see, it wasn't so bad! But that's later. And sometimes it is a turning point and sometimes it is that bad.

When you're deciding what your risk tolerance is, it's not a tolerance for the number 10 or the number 15 or the number 25. It's not a tolerance for an "A" turning into a "+". It's a tolerance for accepting genuinely-scary, nothing-like-this-has-ever-happened-before, heralds-a-new-era news events.

Now, the next set of truisms. Nobody knows what's going to happen. No, really. I don't care what the best experts are saying or what the futures do or what happens tonight in Asia. On Monday, stocks might shoot right back up. Or they might plunge some more. Or they might diddle around for weeks leaving us all on tenterhooks and then plunge some more, Or not.

We see this:

Image

Well, we really don't know what will happen. It might be almost nothing... it might be like the start of this period in 1998 and it could bounce back in a few months.

Image

It might be the start of another 50% plunge like 2008-2009. Awful, but over in a couple of years.

Image

It might be like the start of this period in 1937 when stocks plunged about 50% as in 2008-9, but didn't come back for about a decade. (I'm using a long-lived stock market mutual fund as a proxy for "the market," but it's close enough).

Image

It might be like Japan in 1990, down for two decades and still down.

Image

But not to overweight the pessimism, let me add one more chart. Where's last week's plunge? When I expand the scale, it's actually there. The data being plotted includes it. But apparently it's so tiny it just gets rounded off or vanishes at screen pixel resolution!

Image

The point is, the last few weeks were a time when some risk showed up, and your job is to process it. The temptation is to deal with the discomfort by choosing a prediction. Don't. Your job is to confront the reality of that uncertainty, that you do not know what will happen, and can only make the roughest guesses as to the likelihood of all these scenarios.

Hopefully, you can say "well, yeah, I knew all that. I'd much rather see the market go up and I feel anxious, but I'm able to stay the course."

Unfortunately, if you look at all this and conclude that your exposure to the stock market is higher than your risk tolerance, there aren't any good options. It is absolutely a personal decision. The only sure way to reduce stock market risk substantially is to cut back on your stock allocation. Diversification, fiddling around with different flavors of stock, it's all bandaids. When stocks plunge, they plunge. So the S&P drops 50% and your portfolio drops 46%, big deal.

And when the stock market is falling, you can't cut back on your stock market risk without locking in a loss. It's a tough one and a personal decision. You absolutely have to measure one against the other. It's crazy to even suggest a course of action to anyone else and I'm not going to try.

What I'm saying is that this is a good time for evaluation. The risk is here. Don't exaggerate it--we all love drama, but reality is usually more boring than we expect. Don't brush it aside, look it in the eye as carefully as you can. And then look at how you really feel about it--not how you'd like to feel or how you think you're supposed to feel.

And one final thought. If we're lucky, and the stock market comes back at least part way and seems to stabilize for a while... or if it comes roaring back and soars (yes, that' could happen, too)... don't forget how you feel right now. If you feel that you are close to the edge of your risk tolerance right now, then you have too much in stocks. If you manage to tough it out and we get a calm spell, don't forget how you feel now and at least consider making an adjustment then.
Incredible post and hard work still applicable today.

thank you!
j🌴

Good idea re-posting it and pondering about it today. Funnily enough when I googled for the El Erian post I hit this link https://www.reuters.com/business/financ ... 021-09-30/ - Even today it all seems just as crazy, scary and unclear as it did any earlier day in history.
mnsportsgeek
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Re: A time to EVALUATE your jitters

Post by mnsportsgeek »

SantaClaraSurfer wrote: Tue Sep 13, 2022 3:31 pm Opened my taxable account in October, 2018.

My Total Gain/Loss for everything invested in Equities/Bonds since that date is positive .05%, that's a whopping $5 return per $10,000 over 4 years.

I'm not jittery, just non-plussed. Literally.

I know that what this means is both that I've been fortunate to have more to invest in 2021/22 than previous years, and that I was lucky to rebalance in March 2020.

Staying the course. Investing once per month. Will rebalance per IPS. Nothing called for at this moment.
I'm in a similar situation. Opened taxable in 2018. My entire account is down because half of my contributions were put in in 2021.
Not a fun thing to look at these days. Hopefully 2023 is better.
srt7
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Re: A time to EVALUATE your jitters

Post by srt7 »

Leesbro63 wrote: Sat Oct 01, 2022 8:40 am
Florida Orange wrote: Sat Oct 01, 2022 8:26 am For me, bonds are what matter; stocks are just a way to buy more bonds. If stocks go up I sell some and use the money to buy more bonds, if they don't I just leave everything alone. Stocks are simply a mechanism which, from time to time, allows me to buy more bonds. And the purpose of bonds is to generate interest. Thus, fluctuations in the stock market are two steps removed from what I really care about. I think this, more than anything else, explains my lack of jitters.
Fascinating. All my years here and I've never seen anyone with this type of thinking.
Same here. But when you think about it that's sort of what Target Retirement Funds do.
Taking care of tomorrow while enjoying today.
manlymatt83
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Re: A time to EVALUATE your jitters

Post by manlymatt83 »

Somewhere at some point someone posted a link to a bunch of smart people who made predictions about the market in the past and were wrong over 50% of the time. Anyone have that handy?
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