The Market Has Never Plunged 10% This Fast To Start A Year (But We’ve Had Biden As President For A Year!)

Confounded Interest ^ | 01/24/2022 | Anthony B. Sanders

[hardspunned]

There are middle class families who have made out like bandits under Biden (assuming you had your house and cars when the regime came to power). Federal dollars have been raining from heaven if you have kids. Your house and auto valuations, along with your 401k are through the roof. It’s been a great ride for some people but the piper is about to be paid. When that 401k hits below Trumpian levels and that loaf of bread hits $5, the regime might have to deploy the anti domestic terrorists squads for those terrorist housewives.

[cuban leaf]

I strongly believe it’s better than a 50% chance.

And preparing accordingly.

[brownsfan]

Here’s the bright side, most people have a 401k. When they see that 401k shrinking fast, they will be angry at the party in power. This includes Democrats who see their 401k turned into a mini.

[HighSierra5]

GETRIDDADABUM!

[realcleanguy]

many of the other LW discussion boards fault Trump and his “insurrection” for the drop in the market, Russia invading Ukraine and China now threatening Taiwan. It’s like they want you to think Joe Biden is “The Victim President” who is powerless against any decision Don made years ago. Pathetic.

But many of the LW posters on those boards are excited about Ukraine and want to get in a shooting war with Russia, claiming “Joe can knock all their nukes out of the sky and turn Russia into a lake of fire”. Very disturbing, because these are folks like AOC saying this. Which means most progressives see a nuclear war with Russia as a serious alternative to be considered.

We have a nation of idiots who think nukes are once again the answer to all problems..

[sarge83]

Not selling but BiteMe has cost me $30K in my 401 the sorry commie stooge.

[Political Junkie Too]

You only lose if you sell.

The income generating power of my portfolio remains the same whether the market goes up or down.

I guess I'm about to find out far down the market must go before my dividend income is affected.

-PJ

[Paperpusher]

Biden is making a run at Woodrow Wilson for the worst President ever.

He already beat Wilson, FDR, Obama, Clinton and Carter and is going into uncharted territory.

[rbmillerjr]

“I’m a bit heavy in long-term treasury funds since they tend to go up a lot when equity mutual funds drop bigly.”

If you are in long-term bonds, when interest rates go higher, bonds lose principle value, you can get losses just like a stock.

[olivia3boys]

Money has indeed been raining from heaven. My husband and I are in the top 5% of household income in the United States, and STILL we are sent regular checks from the IRS for my teen daughter, and my teen son enrolled in Cal State has been sent multiple $1000 checks (from Cal State new Covid funding I’m guessing) for no good reason that I can tell. He does not need that money.

[Tell It Right]

I agree. And yet, bonds tend to go up in price as a safety play when stocks go down. IMHO, the downward pressure you speak of tends to happen for a slow while and go down just a little compared to the upward pressure I'm speaking of.

But that's me using it with the timing of active investing. If I was doing it as a swing investor I'd stay out of LT treasury funds for the reason you say and try to time the jump into them to ride them up as stocks drop.

[Belteshazzar]

No, Joe is angling for the William Henry Harrison Presidential Achievement Award.

[Belteshazzar]

No, Joe is angling for the William Henry Harrison Presidential Achievement Award.

[mountainlion]

October 1987 the stock marked crashed 23%

[rbmillerjr]

Seems like you are on top of it then. Many investors aren’t aware of that.

Retiring in 1.5 years, I was equities 100% and went to cash just as the market started degrading, so I was lucky to have 3 straight years of big gains prior to that on a nice chunk.

Going to have to look into multiple sources of bonds and stable equities with good dividends, for my income/bond portfolio. Top rated corporate bonds, hopefully will give a little bit more of a yield.

[pfflier]

Stuck there too. This past few weeks I was happy with the dailies if I only lost in triple digits. Some recent days down $4k in a day.

[Tell It Right]

Thanks. Sounds like you have a plan too. I'm about 5 years from retiring. I don't move out of equities often. But I was out for 2019 and early 2020 until I saw the S&P 500 drop 30+% in a couple of months. I had intended to stay out of each equity fund until it dropped 50% (in which case I'd go back into that one fund) or until the S&P 500 dropped 40%, or until the aggregate of all of 36 of my equity funds (spread out across many asset classes) when down 40%. That's because I was looking for a slow drawdown of 40+% like the last major ones (early 2000-late 2002 and late 2007-early 2009). But when Jan to Mar 2020 looked more like a rapid drop of 30% like 1987 (which had a nice rebound after that), I jumped back into all equities in the 1st week of March. That's because I was 7 years from retiring back then.

This time when I go back in I'll be 75% equity funds and 25% safe funds (evenly spread out in short term and long term capital bonds funds, short term and long term treasury funds, municipal bonds, and money markets). And I'll stay in that portfolio, withdrawing 4% per year when retired, with all of the withdrawal coming from the one or two funds that happen to have the highest balances at the time (selling high). I may or may not get out of equities again in retirement if we're in another ultra high Shiller PE environment of an old bull market.

[rbmillerjr]

I can’t wait to get to Tampa Bay, my wife will be 57, I’ll be 62.

Same deal here, 4% drawdown. I phase in and out of equities,after a 2-3 year bull run, usually. Right now, it’s about when to get back in. Strategists and money management types, are between 4 and 11 % gains in 2022 in the S&P.

Although, I’ve been pretty much 100 stocks my whole life, I did get lucky and time the Mortgage crisis perfectly, and then got back in within 500 points of the Dow low.

Depending on what the market does between now and retirement, I’ll make my portfolio decisions. There is a lot of risk downside with very little return expected. So, this will be a challenge to stick with my conservative retirement portfolio. But, the upside and downside range just doesn’t look great. So, I’m likely to just be like 20% equities until I’m certain we are in for another long bull haul.

I’ve been reading alot of Modern Portfolio Theory and really focusing in on Retirement Portfolio risk, especially Sequence risk, where taking losses early in retirement is a big killer. Good reason to be overly conservative early, unless the market shows the all clear signs.

My biggest mistake was the 2000 bubble, lol, kept doubling down with my discretionary account. My second biggest mistake was not moving from Maryland, so my first distribution from my 401k, will be taxed by feds and also Maryland. I freaking hate Maryland and will get a last F U from them prior to getting to Florida.

[eyedigress]

Yea, I put 90% into a vanguard preservation fund 2 months ago.

It doesn’t move but loses against inflation.

[Organic Panic]

They REALLY wanted their hands on those trillions in 6build 6ack 6etter.