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The Stock Market

Infinite Jest said:
Except that in a few years their investments will recover.

I'm with GM; long-term investments could be a good idea right now. I suspect we haven't hit the bottom yet: we've seen a big fall based on the problems in the banks, but we haven't fully seen the decline that the recession will cause.

(I can see what captainballs is saying, but personally I'm not knowledgeable enough to get into all that).
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I'm sure it will recover, but some of those people don't have 20 years to wait. It's their retirement that is no longer worth anything, so they have to work now. Sure, I have 20 years to wait if I want, but there's always the chance that I'll be in their situation as well. It's not like you can take your 401k out and put it into a bank CD or something that is safe and guaranteed.

Besides, I'm sure the Russians thought their economy would recover too.
 
Perpetual Indulgence said:
I doubt that but good luck.
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I don't. We have lasting institutions like Allied Irish Banks, Wells Fargo, Citi Bank, and Morgan Stanley that will be paying great dividends for the rest of my life currently trading at a fraction of their value. There are companies like Apple, Oracle, Google, and Microsoft that are going to be profitable for decades to come selling at over 50% off. We have companies like Netgear, and Underarmor that have so much room to grow as they become the household brand names of tomorrow selling for chump change.

Even if the current financial crisis hadn't made these companies dirt cheap investing in them would easily multiply your money over the course of a couple decades. The current situation has just sweetened the deal.
 
I just don't like the idea of gambling my money. I'm one of those people who went to vegas, lost about $10.00 on the quarter machines and was done gambling for the rest of the vacation. LOL
 
Lysis said:
I'm sure it will recover, but some of those people don't have 20 years to wait.
Besides, I'm sure the Russians thought their economy would recover too.
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OK, I thought you were talking about people in 20s-30s. Fair enough then.

btw the Russian economy has been doing great for the last few years (although their stockmarket tanked along with everyone else's, and no doubt the decline in production will lead to a reduced need for energy, therefore lower prices; which will hurt them temporarily).
 
GenericMind said:
There's so much money in this country that the thought of an actual lasting collapse is mind-boggling.
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You forgot to add "that isn't ours" to "there's so much money in this country". China and Saudi Arabia have huge interests in our country and have helped fund our rampant consumption. They could decide that holding our debt isn't worth it and pull out "so much money in this country". Personally I doubt that America's markets will be what they once were in coming years. Sure, there'll be ups and downs, but this is more about fundamentals. The only thing we produce anymore is the fucking dollar, and that can only last so long before inflation ruins the party. We have too many service industries, especially ones that were based on housing and other lackluster industries, and not enough manufacturing. We have serious trade and budget deficits that have to be addressed before we can have strong underpinnings of our economy.
 
Liquidation of US assets owned by foreign countries would be just as destabilizing to the rest of the world as it would be the America. China and Saudi Arabia aren't going to be doing that anytime soon.

And I'm not sure what you mean by us only producing the Dollar anymore. Our GDP is higher than the next 4 highest GDP countries combined. Our GDP is almost equal to the entire European Union combined.

The market isn't going anywhere but up from here.
 
I trade on the stock market for a living (at the moment).

This market is absolutely perfect for trading, and I make more in a couple days than most of my friends do in a month. Technical charts indicate the Dow Jones isn't going to bottom out until it hits at least 7000.
We've had a few sucker rallies, but the bear market is still going strong, we're only 12 months in... the bulls aren't going to be released for a long time, so brace yourselves!

If you are an investor, DO NOT PANIC SELL. Selling out at a massive loss now is stupid, because these things are cyclical and the market -will- recover.

If you trade on the ASX, keep an eye on LNC and CXY for long term investments. Also some of our financials, like CBA and WBC are going cheap, so watch them like a hawk.
 
World leaders have made it pretty clear they're not going to let the financial sector go underwater. A few, like Lehman Brothers and Bear Stearns had to fall to start this whole thing, but the FDIC and treasury here and other agencies around the world have pretty much stated that a failure in the financial system is not an option. With them backing the banks like they are, them failing would pretty much have to mean a complete collapse of the world economy(which isn't going to happen).

IMO investing in major banks from this point forward is as secure as it can get. They were already steady stocks with good dividends before this happened. Now they'll have a get out of jail free card with governments fully backing them if they run into trouble in the future.
 
Originally Posted by postlapsarian
Selling out at a massive loss now is stupid, because these things are cyclical and the market -will- recover.
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Selling at a massive loss before January 1st could be the smartest thing to do, if you really are trading for a living. Don't forget about taxes. I agree that right now is an awesome time in the market, especially if you're into options. As far as stocks go, it's a terrible time for old people who are just long in some portfolio with no insurance or knowledge of derivatives whatsoever. They're pretty much fucked. Lame social security, looming hospice/medical care costs. I know one set of my grandparents are getting raped right now in the market, where most of their net worth resides. They are over 80 years old.
 
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I suppose stocks are ok if the plan is to buy and hold. I just picked up a large amount of Playboy stock in late november for $1.08/share because I couldnt pass up on the deal. There were also a few others that I had to buy simply because of the low prices...

I am more into trading currencies on the forex markets, and did very well in 2008 (it was a great year for currency trading!). With currencies, you have to trade with margin (generally I trade at about 200:1), which can make for big gains or quick margin calls. It is very fast paced, and you have to have a strong grasp on technical analysis (i.e Fibonacci retracements) as well as a very good understanding of macroeconomics/money supply. I have found currencies to be a superior and more profitable investment vehicle than the stock market.

Also, I've been getting into high yield bond investing, but I still have alot to learn about these types of bonds...
 
Yeah I've been meaning to learn more about bonds. I think I like the risk too much to abandon stocks for them though.

Forex scares the shit out of me I always lost money when I tried it.
 
High yield bonds are quite risky.

You can make a lot of money gambling on margin and junk bonds. It all depends on your risk tolerance. In your 20s you shouldn't be too worried. But if you invest conservatively than you are almost guaranteed to be rich in 40 years. Can you wait that long?
 
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