20 years ago I wouldn’t have cared near as much, but at my age and closeness to drawing those funds for my living, it means more, and I pay supreme attention to it.
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20 years ago I wouldn’t have cared near as much, but at my age and closeness to drawing those funds for my living, it means more, and I pay supreme attention to it.
Exactly.Quote:
Originally Posted by Catonahottinroof
Over the course of decades the market returns pretty consistently, between 11%-14% depending on what study you use.
The problem is timing bc if it's down when you have to start pulling money out, or moving from equity to annuity streams, you can get jobbed very badly.
However, the actual value of the market is only part of the equation. The bigger part is the fear and uncertainty that the market indexes reflect, not cause. That means consumers hold their money instead of spending, businesses don't invest.
The whole system works on confidence. If people believe the future will be good, then the future is good. If they think it will be bad it will be bad. IT's that simple at a macro level.
This makes people think it will be bad, whether you agree with it or not. Doesn't matter, that's how it works.
This was using a chainsaw to conduct surgery, as Trump always does. He has the potential to do great things and he f***s it up by going so over the top with everything he does.
The Market prices of stocks are transitory. Yes you are seeing a short term drop. maybe even midterm. But I am willing to be the 10 year avg. return for Stocks will stay 10% from the 5 years before March 2025 through the 10 year period through Feb 2035.Quote:
Originally Posted by CitizenBBN
Darrin, so do I. I know my date. My contract expires June 30 2029 (and I hope my daughter is out of college by that time...). But that is my last paybheck at current employer and no plan for an employee job after that (may do some consulting).Quote:
Originally Posted by Catonahottinroof
But I am building 2-3 year market downturns into my cash projection needs going forward. That is part of our fiscal planning with our financial planners (or in my case myself)
Long term the market will return between 11% and 14% depending on the study you do. As I said.Quote:
Originally Posted by VirginiaCat
So yes, long term the markets respond and adjust to these transitory swings.
But if you had your money in the market in 1929 or 2008 and you were trying to retire, you were still screwed.
Did the markets recover? Did businesses close during those downturns? Yes. Did people lose their jobs? Yes. Did people suffer even if after 10 years the markets returned to average? yes.
As I said, it all depends on what you are playing for. My retirement money I didn't worry about, I can't touch it for at least 10 years, so yes it shoudl be fine.
But my short term investments all got converted to cash prior to Trump's "liberation day". I liberated my money from the capital markets.
Guess what? So will every business, every investor. Businesses hate uncertainty, it freezes them from borrowing and making capital investments. They will hold cash.
Pretending this doesn't have a big negative impact that businesses have to plan to survive in the short term just b/c in 10 or 20 years it will all be OK is just misleading. Sure it will be OK on average in a decade, but I'd rather my business not be one of the ones that is driven to closure and a distant memory in 10 years, which is exactly what happens in downturns.
The market averages will recover, which is why I suggest investing in the broad indices barring inside information, but the devil is in the details, and in the short term every business and consumer will shift to holding more cash and reserves, and that's just how economies work.
The way this was implemented was Trump's usual chainsaw approach to surgery, and in fact I can prove it b/c the relented very quickly when they found out they were going to create a recession that we wouldn't be out of before the midterm elections, thus the 90 pause, etc.
Yes the markets long term are a sound investment, but that doesn't mean that short term collapses and recessions are not to be worried about and that PResident's can freely ignore them, politically or economically.