Dow hits Record 22K,,,,,,,,

[Cryptoad]

So Glad to hear that the Rich are getting Richer!

[Loki Liesmith]

1. I'm glad too

A rising stock market is good for my son's college fund.

[Gabi Hayes]

2. Just wait

Oops

Better know when to GTFO

Good way to lose your ass when the "correction" comes

[drray23]

5. nonsense. its not how this works.

if you are in it for the long term via a 401k for example, you dont get out everytime it drops. it would be stupid. you ride it until it goes back up. no losses. Untill you actually sell shares you have not lost a cent.

[Gabi Hayes]

6. The long term ends the very moment you

actually need real money, not numbers on a page

Just wait til you need the money

Hope you're well diversified

Good luck!

[LostOne4Ever]

12. Isnt holding onto stocks when the markets are going down a waste of money?

Unless the commission is too high Wouldnt it be smarter to do research and buy/sell accordingly?

[former9thward]

14. If you are able to time the market that should be your full time job.

You will have far more money than from anything else you can do in life. Very few can do it however. I don't know of anyone.

[drray23]

16. true but its easier to invest in indexed stocks and let it ride.

For example the money you invested at the end of bush years when dow was at 6000 bought shares that are now worth over 3 times what they were.
Very few people are able to beat the market by selling and buying at the right time. First, you need to do that with a lot of money if you want to offset the cost of the brokerage fees every time you transact. Second, this implies that you can lose a lot of money if you dont do the right thing at exactly the right time. You may have increased the potential rewards but you also increase the risks greatly.

Unless you have more than say a million in the market and you can do that fulltime, its foolish to try. You will lose money for sure.

[Awsi Dooger]

40. I'm in mostly index funds and AAPL

Apple stock basically changed my life from sports bettor full time to now mostly an investor and part time sports bettor. Frankly it's not nearly as interesting but considerably more stable.

I remember countless battles I had around here in the early 2000s with a few prominent posters who insisted that Apple was nothing but overpriced hardware, blah, blah blah. That was a classic example of missing the big picture completely. I had no idea what Steve Jobs would do, only that it was huge favoritism to be brilliant. Turns out it was smart phones. Okay. I thought it would be movie related. So I was wrong.

Now I've got lots of FUSVX and FSEVX and FSRVX, stuff like that. Fidelity index funds. Really the only fun I've had lately is last year trying to time the biotech fall and rise. That was closest to sports betting as anything I've come across in the market. Wonderful volatility. I did gobble too soon in January 2016 but once I figured out to let the knife fall I managed some great prices on XBI later that year. That's a biotech ETF.

I'm not exactly a Boglehead. In fact I joined that forum briefly and I don't think they liked me. I was making too many decisions for them, specifically on biotech. Also there was no way I was going to accept their stupid bond index funds when something far superior is out there in PONDX/PIMIX.

One reason Trump is not as vulnerable as conventional wisdom allows is that he inherited an economy from Obama and stock market from Yellen/others that were on the verge of strength. Naturally he'll claim full credit and many idiots will be happy to assign it.

[MichMary]

19. I have a friend who was an investment advisor

in 2008 or 2009 when the DJIA dropped like a stone over the course of just a few days. She said she BEGGED her clients to leave their $$ in, but the more the Dow dropped, the more people she was unable to convince. Many, many people took their life savings out of the market. Many of those people lost hundreds of thousands of dollars. Those who left their $$ in have tripled their money.

[Yupster]

38. She didn't do a good job for her clients

You have to constantly show and remind clients that big drops will happen and when they do, this is what we are going to do.

By the time the drop comes, the conversation may have been had 5-10 times.

You can keep 98 % of your clients invested if you do a good job teaching way ahead of time.

I actually had more trouble in 2000-2001-2002 when the S+P was down 9 %, then 11 %, then 22 % three years in a row. My story got old after 2.5 year of straight down.

[elleng]

3. and my investments, for my children and grandchildren,

FAR from 'rich,' as many will erroneously claim.

[Orsino]

4. It is not a measure of the health of the economy...

...but only of how rapidly Wall Street is stealing from us.

Indirectly, it does at least indicate that there's still something to steal, so maybe I shouldn't dismiss it entirely--but it's nothing to brag about.

[A HERETIC I AM]

9. ....

[Amishman]

10. Stealing from us implies the money supporting the stock valuation exists

We are looking at a bubble that will make the 2008 real estate collapse look good.

It's just numbers, there is no increased value supporting the rise in valuation

[ProfessorGAC]

11. Can You Point Me To A Supportive Study?

I would need a pretty comprehensive economic review and mathematical model to believe that conclusion.

I've not seen any reputable models that suggest any such thing is likely.

[Amishman]

15. Basic statistics

Just look at the increase in the average P/E ratio.

This is a measure of stock price vs earnings. The higher the ratio the more a stock is being valued in excess of what the company actually earns.

The historic average of the S&P 500 in this measure over the past 130 years or so is 15.66. median is pretty close at 14.66 so fairly uniform data.

Currently the S&P 500 P/E ratio is 24.61 and rising.

Stocks prices are increasing much faster than the growth of the actual companies.

Price to book value is doing this as well.

S&P mean and median: 2.74 and 2.75. again uniform historical data

Current level: 3.21 and rising.

Stock price increasing faster than the basic value of company assets.

If the book value isn't there and the earnings aren't there, what is there to justify the price increase? IMO, nothing, hence my calling it a bubble.

[ProfessorGAC]

17. Whatever You Say

Good econometric modeling goes far beyond basic statistics. Hence the reason why applying supply and demand to macroeconomics doesn't not work (you are aware of course, of the failure of supply side economics?) because it's a two dimensional construct but the economy is multidimensional.

I did not have that hard a time getting statistics students to embrace the idea that economics is a little more complicated than "this therefore that". So, i'll assume you'll embrace it too.

Now, could you point me to a study that supports your hypothesis?

[Amishman]

20. You first, I posted at least basic evidence to back up my statement

You have not provided anything of substance. What can you provide to back up your position that the current stock market spike is not a bubble? What new assets are represented by the ~2.5 trillion in increased valuation of the S&P 500 over the past six months?

[leftstreet]

29. !

That's interesting. Thanks for writing it out like this

[Yupster]

39. It's all based on corporate earnings

which have been very strong lately.

If a company makes a lot of money, its stock generally goes up.

[LexVegas]

7. I'm not rich and its helping me. nt

[MoonRiver]

8. Now we can give more to DEMOCRATS! Thanks Chumpy!

[brooklynite]

13. So are union pension funds...

[Cryptoad]

21. Thankfully my Union Pension Fund

has very little investment in Stocks,,,,,, Most of ours is Real Estate. that why we didn't take a big hit in 08 like a lot of other pension Funds heavily invested in Stocks did. And Thank Goodness that Bush's Social Security based on the Wall Street , failed!

[Dreamer Tatum]

25. Yeah real estate barely moved in 08...

[Cryptoad]

27. that is Funny,,,,

there is Real Estate and then there is,,,,,, REAL ESTATE!
sorry we dont invest in Jim Walter homes,,,,,, we do own a lot of Golf courses,
high end resorts, et al;

[Dreamer Tatum]

32. So your retirement is tied up in the 1% as well. Gotcha. nt

[Cryptoad]

34. Im just glad my Union Pension Fund is ,,

not mostly in Stocks, and invested in less volatile real estate assets. Better than investing in the local Meth Heads.---- but each to his own,,,,,,,,

[Dreamer Tatum]

36. Clearly it's not invested in period keys. nt

[Cryptoad]

37. yep

when people run out of anything of substance to say ,,,,,,, they usually resort to personal attacks,,,,,,,,geeez

[uponit7771]

18. Another PE Bubble like in 2007 and 1929 and 2001 - ish

[Cryptoad]

22. If u aint got enough money to make the Stock Market move...

u playing in a sucker's game!

[brooklynite]

24. And your investment solution is...?

[HeartachesNhangovers]

30. That's obviously not right. Lots of regular people have

used the stock market to increase their savings. Yes, you do have to educate yourself before investing. Yes, you do need to be wary of advice from people who stand to make money from you. And yes, there are no guarantees. But it's also a fact that anyone who followed the most basic advice would have made money in the US stock market over the length of time that most people work (35-45 years). What are the basics?

*Don't invest in anything you don't understand.
*You don't need a "professional" to invest your money.
*Know what fees you are paying and find a low-fee, no-load
option. These are always available.
*Follow the standard advice about diversification: riskier when
you are younger and less risky when you are older.
*Monitor how you are doing and act accordingly: If you need to
save more, do it. If you need a higher-paying job, find one. If
you can't afford certain luxuries, do without.

And yes, I know that many people won't have a comfortable retirement, no matter what they do. I'm not blaming them - that's just how life is.

[onenote]

23. If the market dropped 50 percent overnight (which it never will)

it would still be over 4400 points higher than where it was at the bottom of the 2008-2009 "crash".

I've said more times than I can count -- anyone who looks for stock market advice on DU is a fool.

[linuxman]

35. Yep

Fun to read and the ignorant sour grapes posts, though.

[ksoze]

26. I know. Trump has said so 100 times in last 6 hours.

[Doreen]

28. Yippee fucking skippy for those who are rich or who can AFFORD to have

pensions, stocks, and investments. For the rest of us it does not mean a damn thing because every time the Dow goes up the only ones who profit are those who are rich or can actually have them. For the poor it either effects us negatively in some way or not at all.

[ProgressiveValue]

31. And seniors who rely on dividends to finance their retirement.

Just because one wishes to believe the only people in the stock market are people like Trump, doesn't make it so. Cheering when the market crashes is to cheer retired grandparents losing their retirement.

[llmart]

41. I'm with you...

My annual dividends from my one stock index fund is enough to supplement my Social Security and meager earnings from a part time job. I've had an IRA for 35 years and it is still true that you have to start early, never withdraw until you're retired, and don't panic when the market drops. I'll add my own piece of advice to those who are younger than 65 - learn to live within your means and be frugal. You won't regret it.

[panader0]

33. I'm no economist, but I don't believe this growth is sustainable.

As gabi said above, there will be an "adjustment", and I think it will be painful.