The Long Term Investor

Discussion in 'Investing' started by WXYZ, Oct 2, 2018.

  1. TomB16

    TomB16 Well-Known Member

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    It's your life.

    Mine too.
     
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  2. WXYZ

    WXYZ Well-Known Member

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    About what I figured today. I was down in the RED today. I had two of ten stocks that were UP.....MSFT and GOOGL. I lost out to the SP500 today by 0.13%.

    BUMMER.
     
  3. WXYZ

    WXYZ Well-Known Member

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    WELL.....in about a little more than a month it will be election time. I figure that is the best hope for the markets this year. A stalemate is the preferred outcome to have any hope for a little market stability.

    If we dont get stability....well....we might just be in for another 2+ years of BEAR MARKET. It is not out of the question......we went through the same dismal thing with Jimmy Carter.
     
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  4. WXYZ

    WXYZ Well-Known Member

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    And to continue the HAPPY TALK.

    I was looking for articles today dealing with the approaching retesting of the mid June lows. I could not find anything. I guess even the media does not want to touch this topic. BUT......we are getting VERY CLOSE. Here is what I figure:

    SP500 - The market low was on June 16, 2022. At that time the SP500 closed at 3666. Now, as of today, September 21, 2022 we are at 3757 on the SP500. So right now we are ONLY 2.4% away from the prior LOW.

    DOW - The market low for the DOW was on June 17, 2022. At that time the DOW closed at 29,888. Now, as of today, September 21, 2022 we are at 30,076 on the DOW. So right now we are only 0.62% away from the prior LOW.

    NASDAQ - the market low was on June 16, 2022. At that time the NASDAQ closed at 10,656. Now, as of September 21, 2022 we are at 11,066 on the NASDAQ. So right now we are only 3.79% from the prior LOW.

    It looks like to me.......some time either tomorrow or next week......we will be trying to BREACH the prior low for the year. With all the Technicians among the professionals and short term traders and with all the computer program trading.....if we breach the prior low we could see a significant FEAR DROP in the markets to new lows for the year.

    Personally I dont see much standing in the way of RETESTING the prior market lows. When we hit the prior lows I felt that we were at a SOFT BOTTOM.....with perhaps 10% wiggle room to the down side. I would not be surprised at all to see us start to soon dip into that additional 10% in market LOSSES.
     
    #12464 WXYZ, Sep 22, 2022
    Last edited: Sep 23, 2022
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  5. WXYZ

    WXYZ Well-Known Member

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    AND.....today was earnings reporting day for my COSTCO stock. BUT....strangely I cant find much of an article about it. Here is one.

    Costco reports results that top estimates and $200 billion annual revenue for first time

    https://www.marketwatch.com/story/c...ion-annual-revenue-for-first-time-11663878847

    (BOLD is my opinion OR what I consider important content)

    "Costco Wholesale Corp. shares slipped in the extended session Thursday even as the retailer reported quarterly results that beat Wall Street estimates and annual sales that topped $200 billion for the first time.

    Costco COST, -1.20% shares declined 2% after hours, following a 1.2% decline in the regular session to close at $487.17.

    Costco reported fourth-quarter net income of $1.87 billion, or $4.20 a share, compared with $1.67 billion, or $3.76 a share, in the year-ago period.

    Revenue rose to $72.09 billion from $62.67 billion in the year-ago quarter.

    Analysts on average expected earnings of $4.17 a share on sales of $70.8 billion, according to FactSet.

    Sales at stores open for at least a year rose 13.7%, in-line with Street estimates.

    Annual sales crossed the $200 billion mark for the first time at $222.73 billion, rising 16% from $195.93 billion in the previous fiscal year. Analysts were forecasting $222.7 billion in sales.

    Costco shares have declined 14% so far this year, while the S&P 500 index SPX, -0.84% has fallen 21%."

    MY COMMENT

    A really good BEAT in the current environment. I dont know what the markets expect.....no doubt they will be punished for having the nerve to BEAT expectations.

    I dont see anything about a membership fee increase. I do see this one little item reporting that whey will NOT raise fees this year. I am sure the market mavens.....will bitch about them not raising the membership fee.

    COSTCO WONT RAISE MEMBERSHIP FEES AS RENEWALS SURGE
    https://www.latimes.com/business/story/2022-09-22/costco-wont-raise-membership-fees

    A GREAT beginning.....or is it the ending.....of earnings reporting.
     
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  6. roadtonowhere08

    roadtonowhere08 Well-Known Member

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  7. WXYZ

    WXYZ Well-Known Member

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    WELL.....there you have it....the DOW has broken through the prior low that was hit on June 17,2022. I dont see anyone talking about it. Even the financial media is afraid to touch this topic.

    Right now it is at 29,791. Back in June at the low it was at 29,888.

    This is like the REFUSAL to cover or even admit that we are and have been in a recession. They are so caught up in FEAR MONGERING the FED stuff....they dont even notice anything else.

    I expect that we will soon see the other big averages also retest the prior lows.....perhaps next week....if not today.
     
  8. WXYZ

    WXYZ Well-Known Member

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    If the so called experts and all the financial media....would admit that we have been in a recession for months....it might actually help the markets. The current REFUSAL to admit that we have been in a recession is just prolonging the fear and confusion.

    Stock market news live updates: Stocks crater, oil plunges as Fed, growth fears intensify

    https://finance.yahoo.com/news/stock-market-news-live-updates-september-23-2022-105526854.html

    (BOLD is my opinion OR what I consider important content)

    "U.S. stocks slid Friday morning as fears of aggressive Federal Reserve policy had equity markets pace towards a big weekly loss and Treasury yields continue a perilous climb to fresh highs.

    The benchmark S&P 500 tumbled 1.2% early into the session. The Dow Jones Industrial Average plunged more than 300 points, or 1.1%, falling below the 30,000 level for the first time since June. The technology-heavy Nasdaq Composite off by 1.2%.

    Meanwhile, the 10-year U.S. Treasury note spiked above 3.7%, hitting the highest level since 2010. The U.S. dollar index reached a fresh two-decade high. And in commodity markets, crude oil fell, with West Texas Intermediate (WTI) futures plunging 4.4% to $79.85 per barrel and Brent crude oil down 3.7% at $87.05 per barrel.

    The moves come after Federal Reserve officials raised interest rates by 75 basis points for a third straight time earlier this week and Chair Jerome Powell implied in hawkish remarks that policymakers were prepared to accept economic pain in exchange for restoring price stability. Central banks around the world have followed suit in recent days.

    Goldman Sachs has slashed its year-end 2022 target for the S&P 500 index by about 16% to 3,600 from 4,300.

    The expected path of interest rates is now higher than we previously assumed, which tilts the distribution of equity market outcomes below our prior forecast,” Goldman’s David Kostin said in a note.

    "Based on our client discussions, a majority of equity investors have adopted the view that a hard landing scenario is inevitable and their focus is on the timing, magnitude and duration of a potential recession and investment strategies for that outlook,” he wrote.

    In corporate news, Costco (COST) was among Friday movers after the bulk retailer reported fiscal fourth-quarter earnings and revenue that beat Wall Street estimates but said inflationary pressures were weighing on profit margins as consumer habits shift. Shares were down 3% pre-market.

    Shares of FedEx (FDX) slipped roughly 2% in extended trading after the shipping giant announced cost-cutting measures and rate increases, one week after a grim pre-earnings announcement sent its stock plummeting 20%."

    MY COMMENT

    The last first.......FedEx. that company is in for a very hard time. In the face of their horrible situation they are now raising prices for shippers by over 6%. They are going to find out that they are in a vicious circle of demand destruction. Their CEO is using the current economic situation to HIDE OUT and cover the FAILURE of management at that company. YES....there is a limit in what people will pay for shipping.

    COSTCO.....no surprise there.....no good earnings go unpunished over the short term.

    As to the rest of the above....blah, blah, blah....suddenly everyone is jumping on the FED is going to tank the economy bandwagon. ALL of what we have been seeing has been known and obvious for many months now. Treasury yields.....DUH....when you are raising rates like the FED and calling for a long term continuation......this is exactly what you would expect.
     
  9. WXYZ

    WXYZ Well-Known Member

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    I will say.....I have NEVER seen a time like this over my investing lifetime. We have the markets and the economy tanking. Housing being jawboned into also tanking. We have the FED pushing the economy into a severe recession. We are probably looking at multiple YEARS of BEAR MARKET. AND.....at the same time....government.....is simply ignoring it all, pretending it is not a big deal, spending like drunken sailors and STILL wanting more and more money to give away or spend, blatantly working against the FED, etc, etc, etc. They are totally disconnected from REALITY. I have never seen an economic time like this with the government NOT working in concert with the FED and all other entities.

    This is the perfect recipe for an EXTENDED BEAR MARKET and economic downturn. In other words.....another TWO YEARS or more.

    As I have said before....for long term investors and younger people.....no big deal if you have the GUTS to wait it out and not panic. BUT.....for the recently retired and all the baby boomers that will be retiring over the next 10-15 years......a DISASTER. In the best of times it is very difficult for people to manage their money in retirement. What we are facing will make it IMPOSSIBLE for most people. BOTTOM LINE.....the elimination of pensions and the great....fund your own retirement with a 401K or IRA experiment.....is going to result in a lot of elderly people living in POVERTY.
     
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  10. zukodany

    zukodany Well-Known Member

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    This is such a mess. I have no idea what’s going on anymore… The market just have a mind of its own it seems… what made it tank again just now? This whole thing seems very made up to me tbh. I’m not denying that we have inflation or perhaps a recession going on, just don’t remember this being the case in past downturn periods.
    None of this bothers me of course since truthfully our business is doing great and we’ve been busy building, contracting and traveling. I can tell you - no one’s a bigger paranoid than me when it comes to uncertainties - and yet none of what’s going in the market right now reflects on my personal living/working. and as a LONG TERM investor I simply don’t care. Just watching it all from the 19th floor here in our tower by the beach and reflecting.
    I’ll just have another drink then
     
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  11. WXYZ

    WXYZ Well-Known Member

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    I am sure some if not many....newer or young investors are starting to FREAK OUT....if they have not been doing so already.

    Navigating the Pain of Your First Bear Market

    https://awealthofcommonsense.com/2022/09/navigating-the-pain-of-your-first-bear-market/

    (BOLD is my opinion OR what I consider important content)

    "Earlier this week I posted a chart showing how volatile the stock market has been this year:

    [​IMG]
    Things have gotten even more volatile since then.

    This post prompted the following response from someone on Twitter experiencing their first bear market:

    [​IMG]
    Yes, there is precedent for this.


    These are all of the bear markets since World War II:


    [​IMG]
    If anything, it’s surprising the current iteration isn’t down more.

    Inflation is raging at 40 year highs. Interest rates are rising at their fastest pace in history. Federal Reserve officials are actively rooting for the stock and housing markets to crash. The Fed is trying to orchestrate a recession.

    Yet the S&P 500 is down just 21% or so from its all-time highs. That’s not even an average bear market.

    Maybe we have further to fall. Maybe not. But either way, if you’re going to invest in stocks you have to get used to this.

    Here’s what I wrote in my most recent book about how I think about downturns:


    In the coming 40-50 years I’m planning on experiencing at least 10 or more bear markets, including 5 or 6 that constitute a market crash in stocks. There will also probably be at least 7-8 recessions in that time as well, maybe more.


    Can I be sure of these numbers? You can never be sure of anything when it comes to the markets or economy but let’s use history as a rough guide on this. Over the 50 years from 1970-2019, there were 7 recessions, 10 bear markets and 4 legitimate market crashes with losses in excess of 30% for the U.S. stock market. Over the previous 50 years from 1920-1969, there were 11 recessions, 15 bear markets, and 8 legitimate market crashes with losses in excess of 30% for the U.S. stock market.


    Every one of those bear markets and recessions were unique in their own way. This one is unlike anything we’ve ever seen before when you throw in the pandemic, government spending spree, negative interest rates, supply chain shocks and such.

    Markets are constantly changing and evolving over time. In some ways, it’s different with every bear market.

    In other ways, it’s the same every time, especially when it comes to human nature which is the one constant throughout history.

    Every bear market causes feelings of panic and despair. They make you question your previously held investing beliefs. They force you to consider whether or not you have the intestinal fortitude to stick with your long-term investing plan.

    I’m not going to sugarcoat it for you — bear markets are painful. Every single one of them (even if you’ve experienced a handful in the past).

    But if you’re a young investor, today’s situation is much better than where we were 9-18 months ago.

    The S&P 500 is now down a little more than 20%. The Russell 2000 is down almost 30%. The Nasdaq 100 is down more than 30%.

    Stocks are on sale. They could get marked down even further but I don’t think too many young people are going to regret buying stocks right now when they look back in 15-20 years.

    Can you believe where you could have bought stocks in 2022? someone is bound to say in the 2030s when millennials are in their peak earnings years and gobbling up stocks.

    Not only are stock prices lower but you can finally earn some yield on your cash.

    For years I’ve been bombarded with questions from young people about where to stash their cash while they save for a down payment or wedding or emergency fund when there was no yield to be had.


    Guess what?


    We finally have some yield!


    Short-term treasuries are now yielding 4%. That means higher rates on savings accounts, CDs, money markets and short-term bond funds.

    Prices are down for financial assets but expected returns are rising.

    As long as you’re making regular contributions to your retirement account, brokerage or savings account, the situation has improved this year.

    It doesn’t feel like it because everyone is very angry right now with the combination of high inflation and rapidly rising interest rates.

    It’s difficult to ignore all of that negativity so the best option for young people is to automate as much of the investing process as you can.

    Automate your savings so you don’t have to think about it. Automate your retirement contributions so you don’t allow bad days or months to affect your multi-decade time horizon. Automate your investment purchases on a periodic basis so you’re not tempted to time the market.

    The more good decisions you can make ahead of time the easier it is to avoid the painful emotions that are brought about by the inevitable bear markets.

    Things could get worse before they get better.

    If you’re a net saver in the years ahead, that’s a good thing."

    MY COMMENT

    We are at the start of GUT CHECK TIME for many investors that are not experienced. Very few if any investors since about year 2002 have any experience with a situation and BEAR MARKET like we have the potential to see now and over the coming years. In other words....EVERYONE.....under about age 40.

    If we end up in an EXTENDED BEAR MARKET......human behavior will be the same as it always is. Sooner of later the majority of people will simply GIVE UP. As for my as a 72 year old fully invested all the time investor....

    I continue to be fully invested for the long term as usual.
     
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  12. WXYZ

    WXYZ Well-Known Member

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    Well spoken ZUKODANY. YES....have another drink and enjoy the beach. SCREW the markets.
     
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  13. WXYZ

    WXYZ Well-Known Member

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    Apparently all the issues with the shut-down of the economy are now forgotten. supply chain issues, small business, the fact that 20-30% of the workers were simply apparently beamed off the planet, etc, etc, etc.

    LOL....I raced to post this because at the same time I was typing this......some guy was on Varney was saying exactly the same thing. Some times I swear that some of those TV guys are reading this thread and the STOCKAHOLICS BOARD in general.
     
  14. WXYZ

    WXYZ Well-Known Member

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    GREAT NEWS for those seeking safe income or a safe place to park short term cash. I consider anything less than THREE YEARS as short term. When it comes to stock or fund investing...I consider long term as FIVE TO SEVEN YEARS......MINIMUM. Between three and five years is NO-MANS LAND.....somewhere between short term and long term depending on what is going on with the markets and the economy.

    2-year Treasury tops 4.2%, a 15-year high as Fed continues to jolt short-term rates higher

    https://www.cnbc.com/2022/09/23/10-year-treasury-yield-falls-as-markets-digest-fed-rate-hike.html

    (BOLD is my opinion OR what I consider important content)

    "Yields climbed on Friday and the yield on the 2-year Treasury note notched a new 15-year high as markets assessed the Federal Reserve’s latest rate hike and what it means for the economy going forward.

    The policy-sensitive 2-year Treasury

    hit a fresh 15-year record of 4.266% earlier in the session but was last trading off that high at 4.18%."

    MY COMMENT

    We are going UP from here in the rates.....good news for investors looking for a SAFE HAVEN for short term or other cash.
     
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  15. WXYZ

    WXYZ Well-Known Member

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    The DOW has breached the prior year 2022 low. All the other averages are EXTREMELY close to doing the same thing. I am now going to CALL this RETESTING the prior lows. We are now at the point that many people have been talking about over the past month or two.

    AMAZINGLY......I have yet to see or hear a PEEP out of the media on this topic. I must assume that they are INTENTIONALLY ignoring this....since it is right there in everyone's face and OBVIOUS. They usually LOVE to fear monger this sort of thing. Very strange behavior by the media.
     
  16. zukodany

    zukodany Well-Known Member

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    You have to see people on the planes now - no masks and not a single fkuc given. While I’m certainly happy to see people not acting like sheep anymore it just boggles the mind how people that VERY MUCH BELIEVED covid was the end of the world are now not wearing masks and enjoy life like covid is gone. Where were you months/years ago when we told you it’s normal? What made you change your mind? Was it science or was it the government? How embarrassed I feel for them and how sad I feel for us.
    This is not the end, covid was just the beginning, there is a lot more coming and the beginning of a dark chapter in our history, one that’s about to get ALOT darker - is covid.
     
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  17. WXYZ

    WXYZ Well-Known Member

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    All I can say at this point in time.....unless the election stems the tide......GET USED TO IT....this is going to be a very LONG SLOG. One of those times that severely......TESTS......anyone that thinks they are a long term investor.
     
  18. WXYZ

    WXYZ Well-Known Member

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    GEE......having just looked.....I see that I actually have two stocks that are UP so far today....Home Depot and Honeywell.

    With the general averages NOW retesting the June lows.....I, due to the quirks of the specific stocks and funds that I happen to hold.....STILL have another 4.9% to get down to my prior 2022 low. Will I get there.....I dont know....perhaps. If I do....what will I do....NOTHING.

    One thing for anyone that is near.....lets say 5 years of retirement.....we should see some really good payouts on INCOME ANNUITIES over the next 6-12 months. The next 6-12 months might be a really good time for anyone to lock in a FIVE YEAR DEFERRED (lifetime) INCOME ANNUITY.....or even an IMMEDIATE (lifetime) INCOME ANNUITY.....if that fits your retirement plan.

    Here is a very good and accurate calculator for current income annuity pay-outs.

    https://www.immediateannuities.com/

    This company......Immediate Annuities.....is a long time recognized leader in the income annuity field. I used them to put my income annuities in place. Of course......I do NOT recommend all the other sorts of annuities......the "bad" annuities that have very high fees and reams of small print....that are "sold" based on "projections".

    For example right now....a five year deferred income annuity for $500,000....for a 62 year old male in Texas will pay out.....$3917 per month for the rest of your life. Combine this with Social Security....and...other assets.......and you have a pretty good lifetime retirement income.
     
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  19. Smokie

    Smokie Active Member

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  20. Smokie

    Smokie Active Member

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    Reference the above...not really, I just thought it was funny. We have to have some fun during these stressful times or we will all go crazy. I think most of you guys prior posts this morning are pretty spot on. I think there will probably be many that do head for the exits. I think some of the new investors may, unfortunately, be thinking of the last little bear market that occurred with covid. It was very short lived and was the shortest one we've ever had. This is going to test a lot of people no doubt about it.

    This is why it is important to have a financial plan. Holding a "portfolio" of a few favorite stocks is not a plan. We are all going to have some discomfort no doubt about it. Those with a solid plan are going to be able to handle it...although it will battle test us all. If one has not experienced a significant bear market...this may be your chance. It sounds silly at the time, but you will gain valuable experience from it I can almost guarantee it. And guess what...you will get another one at some point down the road.

    This thread may have to divert into a support group for awhile:)
     
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