Posted on 07/08/2022 1:20:10 PM PDT by Wuli
In a market pullback the balances in retirement assets (401ks, pensions, etc) will decline, perhaps substantially, and some pension funds could come under enormous stress. I agree that this could exacerbate a recession as retirement incomes shrink and reduce total spending – at a time when the economy is struggling.
But there another broader problem involving what’s known as the wealth effect. Whenever there’s a significant market decline people lose confidence in spending as the value of their assets decreases. This also leads to lower expenditures.
The Fed and reckless government spending have gotten us into a hot mess for sure, which will prompt the Fed to ease off on tightening a lot sooner than most people think IMO. I also believe that the Fed is prepared to do WHATEVER IT TAKES to prop up the economy (not saying I agree with that) so we should not lose sight of the potential for huge stimulus, easing and/or extraordinary measures by the Fed to shore up the market. Anyone doubting this should look at the Fed’s massive balance sheet that nobody previously thought possible.
In other words, the Fed will backstop the market if it has to. JMHO
I get what you’re saying but I think there’s more downside to go. We haven’t seen capitulation yet.
Anything other than an index fund that follows the market (DJIA or S&P500) with a nice, long, timeframe is just gambling (at least unless you are a genius or lucky).
Over time the market always goes up (it did take 20 years to regain after the depression, but averaged over several decades still good); picking stocks or trying to time it is a fool’s game, though.
“Get rich slowly”.
Pay Pay gave me $5.00 in bitcoin a couple of days ago for something. Not sure but what, but today it’s at 5.46!
If I hold it maybe it will be worth $1,000,000 in a few years?
I would be clear on the fundamsntals of any tech business and its market history at this point.
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Rising rates and slowing demand are not a good combo for small businesses.
FJB and it’s evil band of flying monkeys.
Not only are they crashing the stock market they’re also trying to undermine the dollar. Plus, the WEF is talking about outlawing food crops and livestock.
With the foreign countries (and mega-billionaires) buying up all the property, that doesn’t leave many alternatives.
Some Bitcoin (and other crypto) buyers have had some buyers remorse lately.
Unfortunately Bitcoin holders did not become just Bitcoin true believers, but has included buyers who also old more traditional investments. And when those traditional investments began losing some good many of them sold their Bitcoin to pay of their other investment losses (some made on margin). That whole experience has lessened the Utopian dream that Bitcoin would be hedge against the rest of the investment world. Restricted to just Bitcoin true believers that might have been the case, but its not the reality.
Yes, Bitcoin holders that just hold on will see their value return eventually, but that is true for many stocks as well. Bitcoin is proving to be less unique of an investment in reality than its inventors sold it as. Like many things a good component of it is simple speculation.
All to be expected with the massive government spending, Fed Reserve “QE” and “stimmy checks” since 2008.
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In many ways, the excesses of 2008 were never corrected, they were just papered over, and now the glue holding paper has come loose.
Now say hello to the subprime auto loan bond market, where the loan pool “has an average FICO score of 553, an average current principal balance of $11,167, an average interest rate of 16.39%...”. What could possibly go wrong.
I think investing in some school might have been in order but at least it wasn’t “looses”
Wells Fargo moved me to a cash position before the decline and everything looks good.
My 403b.....I won’t even look. I’m buying cheap at this point. Retirement gets put off for another few years.
Bitcoin was never sold as an investment. Ever.
Anyone buying Bitcoin who doesn’t understand it’s purpose, strengths and weaknesses, deserves to lose every penny they “invested.”
It’s funny, I was reviewing my CAGR for my holdings. The CAGR for Bitcoin is still 66% per year from my initial investment. I understood what it was, and how it’s performed. I knew it would swing pretty hard.
But, only a fool would ride the markets that high without “taking a taste” and reinvesting it.
I get very frustrated with “investors” who don’t think beyond the end of their nose and get their investment information from Twitter or Jim Cramer.
Can’t keep taking these kind of hits.
I took all the money in my 401k out of the markets and just left it there in hopes I can jump back in after the downturn stops. I think the markets will rebound next October when it is clear the Republicans will win both houses of Congress. When sane people are running Congress instead of the clowns running it now, I think some investors will buy in.
BUTTCOIN !?!??
oh, no! I bought BITCHCOIN! Man, I am so screwed! ;P
People are bragging how low gas is now. Dummies.
Now that is retarded.
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