So Now What?

Nov 2012
17,612
5,775
Michigan
so the stock market tanked and your 401k has taken a big hit on a depression level. What ya gonna do about it?
Lots of people are running to cash, which is fear talking. Seems to me a lot of people have gotten rich betting against fear. At this point it can go either way. Either the virus gets a treatment and a vaccine or its 1929 all over again. If its depresion time what’s cash gonna do for you. The rumblings out of Washington is to fire up the printing presses and cover the country with money, which means inflation, big time. And your cash soon will drop faster than your stock portfolio did. Or, the treatments work and later the vaccines and the markets bounce back up in a few months.
So, I say if you sold out of the market, get back in, it’s the only course with an upside. If youre near or past working age you should have been and should stay half in cds and bonds regardless.
 
Feb 2020
1,645
597
Houston
webguy4, you seem to know this stuff.

Did the price of gold really take a dive in March?


The chart make it look worse than it is, but still, dropped by over a hundred dollars and ounce.

How could that be in a time of crises?

Maybe people trust cash now since so many people are taught nothing in school and think gold is just stuff you make chains with?
 
Feb 2018
3,150
2,359
Oregon
so the stock market tanked and your 401k has taken a big hit on a depression level. What ya gonna do about it?
Lots of people are running to cash, which is fear talking. Seems to me a lot of people have gotten rich betting against fear. At this point it can go either way. Either the virus gets a treatment and a vaccine or its 1929 all over again. If its depresion time what’s cash gonna do for you. The rumblings out of Washington is to fire up the printing presses and cover the country with money, which means inflation, big time. And your cash soon will drop faster than your stock portfolio did. Or, the treatments work and later the vaccines and the markets bounce back up in a few months.
So, I say if you sold out of the market, get back in, it’s the only course with an upside. If youre near or past working age you should have been and should stay half in cds and bonds regardless.
Several points:

1. The shift from pensions (defined benefit plans) to 401k plans (defined contribution plans) was for the purpose of freeing corporations from the burden and instead to place all the risk on the employee. And even MORE risk since the 401k is a defined CONTRIBUTION plan instead of a defined BENEFIT plan, and few people with a 401k know anything about investing in stock and how to protect oneself in questionable times by hedging.

2. The stock market had been rising in an unprecedented 10-year bull market because of manipulation by government and by corporations. The market gave a signal that it was about to turn downward in 2014 but QE injections of money stopped it from turning, as did repeated succeeding injections. Then, Trump cut corporate taxes and some of their offshore money was repatriated and invested in buy-backs of their own stock, which pushed stocks higher and higher . . . . on fluff . . . . on nothing relating to productivity. And for these reasons, an informed investor would have known that for the last 4 years or more, investment analysts and market pundits have been WARNING of a hugely overvalued stock market and a huge market crash impending. In fact, many respectable analysts warned that when the market turned on some "future" date, it would crash so deeply as to match or exceed the 1929 crash.

3. Given the damage already done to labor, productive forces, supply chains, and much more including adjustments the public is has been making to the new normal to get along without all the consumption, the drop in the stock market may have begun because of COVID-19, but it now appears to be running (downward) on its own weakness. CAUTION!!! - I have been watching the all-day market reports and critiques every day for 3 weeks, and what I see is a very clear set of evidence that the talking heads are playing to the uninformed public, and not to the informed, savvy, stock market investor as they keep repeating that "the price of stocks is low!" and "this is a great buying opportunity!" That means they are acting as agents for their advertising corporations and their kind by urging the uninformed public to trust them and go out and buy, buy, buy stocks to give the corporate executives time to dump their doomed share into the hands of the public.

4. Anyone who buys now without hedging, . . . --and that means without digging into the subject and learning about hedging FIRST, . . -- is asking to lose more of their money.

5. Anyone with a 401k should have the ability to manage it. And if retired or retiring, should roll the whole of it into an IRA for better control.

6. Anyone who invests more than play money in stocks, should learn how to read stock charts and recognize what they're telling you about where it is going next.

PS.: I predict a big drop tomorrow.
 
Feb 2018
3,150
2,359
Oregon
Lots of people are running to cash, which is fear talking.
The rumblings out of Washington is to fire up the printing presses and cover the country with money, which means inflation, big time. And your cash soon will drop faster than your stock portfolio did.

If youre near or past working age you should have been and should stay half in cds and bonds regardless.
CDs lock you in, and you just warned against liquid cash being at risk if there is great inflation. So why recommend a vehicle (CDs) that lock you into cash? You're contradicting yourself.
 
Nov 2012
17,612
5,775
Michigan
CDs lock you in, and you just warned against liquid cash being at risk if there is great inflation. So why recommend a vehicle (CDs) that lock you into cash? You're contradicting yourself.
Retired folks need to be conservative. I am just another amatuer, I can be wrong or out manipulated by big players with their own agendas. CDs and bonds work great when interest rates are falling.
 
Nov 2012
17,612
5,775
Michigan
Stocks could drop more, but with gold and silver being depressed by governments and billionaires, cash being inflated like crazy, unless you wanna stock up on guns, ammo, liquor and freeze dried food where ya gonna go?
 
Nov 2012
17,612
5,775
Michigan
webguy4, you seem to know this stuff.

Did the price of gold really take a dive in March?


The chart make it look worse than it is, but still, dropped by over a hundred dollars and ounce.

How could that be in a time of crises?

Maybe people trust cash now since so many people are taught nothing in school and think gold is just stuff you make chains with?
Fall in Gold and silver prices appear to be a paper manipulation. If you go to your local dealer and actually try to buy anywhere near stated spot prices you get a different story. No one is selling physical silver at $14.
 
Feb 2020
1,645
597
Houston
Fall in Gold and silver prices appear to be a paper manipulation. If you go to your local dealer and actually try to buy anywhere near stated spot prices you get a different story. No one is selling physical silver at $14.
See, that's why I just build wealth slowly but surely instead of trying to game the system.

I'm sure people make money gaming it, but they won't let in on their secrets in million years.
 
Nov 2012
17,612
5,775
Michigan
So who’s the big players in behind the scenes manipulation? Soros does this kinda crap all the time to make money, but I think this is too big for him. I think it’s the commie Chinese. They’re feeling cornered by their failing banks, disruptions in Hong Kong, Taiwan, and they hate Trump. The way this virus came out the commie Chinese couldn’t have done more to spread it than if it was planned.
 
Nov 2012
17,612
5,775
Michigan
See, that's why I just build wealth slowly but surely instead of trying to game the system.

I'm sure people make money gaming it, but they won't let in on their secrets in million years.
So keep some in stocks, over the long haul they go up.