Dow

[Randown]

Sounds like a good time to buy!  The market has been on a strong run for the past seven or eight years. 

Lots of amplitude, but a look at a long-term graph tells the tale:

I'm not sure if your serious or not...that top chart COULD be misleading at first glance due to its scale.

To see what the market has REALLY done it should be in logarithmic scale, adjusted for inflation & dividend re-investment.

Here's one minus dividends...not all that exciting...

[LowRyter]

I thought I'd bring this topic back since the Dow hit an all time high today.  11 months ago it started a gloomy slide that lasted for months.  Some of us were timing the market, some dropping out, and others staying in.

Of course the smart guys got out at the top and back again at the bottom.

I ain't that smart.   :Beating_A_Dead_Hors e_by_liviu

[Lannis]

Good grief I thought I asked Dusty to delete this thread!

Why would you want to delete it?   Some of the best financial advice you'll ever see is in this thread .... !

Lannis

[kirby1923]

Why would you want to delete it?   Some of the best financial advice you'll ever see is in this thread .... !

Lannis

Agreed...
Don't want to delete, just jerking Dustys chain.

mike

[atavar]

The only sure fire financial advice is to watch what I do and then do the exact opposite.  It works every time.  For a fee I'll tell ya what I did last..   

[oldbike54]

 How did I get drug into this , what little money there is around here is buried in cans in the back
yard 

 Dusty

[K250]

Recently read in the Wall Street journal that if a person had invested in a low cost S&P 500 index fund in the year 2000 and left the money there, re invested all dividends, it would have gained right at 4% a year compounded.   
 
Did a little research and found that July 2000 to date is indeed 4.2% annual return... As crazy low as that sounds.  Also found the average investor does not even get an average of 4.2%.  Most of their additions are a % of pay into a 401K.  Since many people make more money when times are good and less money when times are bad, they automatically put more into the stock market when it is high than when it is low..... 

Not an expert just an old guy surfing the net waiting for the All Star game to start.....

[Lannis]

  Since many people make more money when times are good and less money when times are bad, they automatically put more into the stock market when it is high than when it is low..... 

I'll take a bit of issue with that assumption.  People that are working for companies that do 401K matching don't, in my experience, have "fluctuating" work loads.   Most jobs with that type of benefit are 40-hour-week jobs, maybe sometimes with overtime, but seldom the type of job where the annual pay fluctuates a great deal.   

Buying steadily every month, market high or market low, is still the best way unless you're some sort of warlock  ......

Lannis

[K250]

"I'll take a bit of issue with that assumption.  People that are working for companies that do 401K matching don't, in my experience, have "fluctuating" work loads.   Most jobs with that type of benefit are 40-hour-week jobs, maybe sometimes with overtime, but seldom the type of job where the annual pay fluctuates a great deal. "

Lannis it sounds like you are thinking mostly about the pay of people who stay employed.  The aggregate numbers are or for everyone, when times are bad, more people get fired.  Fired people automatically put in less or zero until they find a new job.   The salary types who do stay employed get fewer raises and less or no bonuses also and that impacts contributions.

Just looked it up.  When the market was bottoming out a few years ago, about unemployment was about 9%.  Currently, with the market at an all time high, unemployment is about 5%.  So 4% of the population was probably putting a low amount in at the bottom of the market, and more in now at the high.   

Edit to mostly add quotation marks.

[Lannis]

I'll take a bit of issue with that assumption.  People that are working for companies that do 401K matching don't, in my experience, have "fluctuating" work loads.   Most jobs with that type of benefit are 40-hour-week jobs, maybe sometimes with overtime, but seldom the type of job where the annual pay fluctuates a great deal. 

Lannis it sounds like you are thinking about the pay of people who stay employed.  The aggregate numbers are or for everyone, when times are bad, more people get fired.  Fired people automatically put in less or zero until they get a new job. 

Just looked it up.  When the market was bottoming out a few years ago, about unemployment was about 9%.  Currently, with the market at an all time high, unemployment is about 5%.  So 4% of the population was probably putting a low amount in at the bottom of the market, and more in now at the high.   

I'll go along with that ....

[K250]

Cool glad to hear that Lannis!  :)  OK the All Star game is starting need to put down the computer have a good evening all.

[PeteS]

Recently read in the Wall Street journal that if a person had invested in a low cost S&P 500 index fund in the year 2000 and left the money there, re invested all dividends, it would have gained right at 4% a year compounded.   
 
Did a little research and found that July 2000 to date is indeed 4.2% annual return... As crazy low as that sounds.  Also found the average investor does not even get an average of 4.2%.  Most of their additions are a % of pay into a 401K.  Since many people make more money when times are good and less money when times are bad, they automatically put more into the stock market when it is high than when it is low..... 

Not an expert just an old guy surfing the net waiting for the All Star game to start.....

John Bogle who started Vanguard Funds, one of the biggest if not the biggest Mutual Fund companies was one of the Pioneers of Index funds back in the '70s. It was shown recently that over the long period index funds have outperformed virtually every managed fund out there. Maybe Warren Buffet has done better, I don't know, but for someone with little knowledge of the market, like me, this would seem the way to go.

Pete

[Lannis]

John Bogle who started Vanguard Funds, one of the biggest if not the biggest Mutual Fund companies was one of the Pioneers of Index funds back in the '70s. It was shown recently that over the long period index funds have outperformed virtually every managed fund out there. Maybe Warren Buffet has done better, I don't know, but for someone with little knowledge of the market, like me, this would seem the way to go.

Pete

The stock market is sort of like "fiat money" that we use today.    For our money, there's no gold behind it, no silver, nothing real.   The only reason it works is because when you give me $100 for something I sold or a service I did, I BELIEVE that whoever I give it to will give ME $100 in goods and services.    If we quit believing, it'll quit working.   Some people say "It's all fake, it's all an illusion, it could blow up any second and THEN all my Krugerrands will be worth ten times what they are now ...."  but everyone still uses money and it hasn't blown up in the time since we quit issuing Gold Certificates.

The stock market is the same way.   Anyone can say it's all fake, it's all managed, it's all an illusion, it's all a scheme to enrich the famous Wall Street Fat Cats that are the subject of entire elections .... BUT real working people for 100+ years have used it to build their regular savings into reasonable wealth for their old age when they use it carefully and regularly.   So I don't know what it means  when otherwise reasonable (?) people say "It's all fake".

I think of the old Disney film "Bedknobs and Broomsticks" when the enchanted suits of medieval English armor are marching toward the invading Germans.   The German captain shouts to his men "It's a trick!".   And one of his men turns and says "Pretty good trick!"

Maybe it is all an illusion, but it's an illusion that I used for 35 years "paying in" and am using now "paying out", and I get to stay home and live off the fat of the land, and work on bikes and ride motorcycles and play with my grandchildren, and I don't hit a lick of work .... and if it does blow up I know how to kill and butcher a deer and how to raise a garden.

Lannis

[LowRyter]

Recently read in the Wall Street journal that if a person had invested in a low cost S&P 500 index fund in the year 2000 and left the money there, re invested all dividends, it would have gained right at 4% a year compounded.   
 
Did a little research and found that July 2000 to date is indeed 4.2% annual return... As crazy low as that sounds.  Also found the average investor does not even get an average of 4.2%.  Most of their additions are a % of pay into a 401K.  Since many people make more money when times are good and less money when times are bad, they automatically put more into the stock market when it is high than when it is low..... 

Not an expert just an old guy surfing the net waiting for the All Star game to start.....

At the that rate that investment in 2000 would just about double in value by 2017.

[Gliderjohn]

Over the years mutual funds have returned me a bit over 4%. Some say a monkey can beat that, maybe. By far at this point the best investment I have ever made has been the purchase of farmland, most bought in the 90s. Prices have increased about 1,000% since then.
GliderJohn