Retail we are still seeing price increases. Today’s employment shows wages continuing to go up. Rents are still going up.
Oil and gas had been dropping but just bounced.
Fed needs to be wary of over correcting, but I don’t think we are there yet.
OT: Stock and Investment Talk
- Thread starter RU-05
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Oil and gas had been dropping but just bounced.
Fed needs to be wary of over correcting, but I don’t think we are there yet.
Rents were down last month. First time in years. House prices have been deflationary for the past 2 months, so housing overall is looking good.
As for overcorrecting, how do we know if we are there or not? Rate increases take 4-6 months to really take hold. Perhaps waiting and patience is what the Fed should be doing now? Not blindly jacking based on BS lagging metrics.
Gas here has steadily and quickly climbed to $3.60/gal, and forecasts hint at a continued upward trend. Those folks in the Mid-Atlantic and Northeast who rely on oil to heat their homes can expect to see an increase of 30%+ this coming winter. As for groceries, as a regular shopper, I'm just not seeing a reversal of inflated pricing.
That said, my view is that inflation and further increases will be with us for many more months, if not a couple years.
Stop being a bear. Gas is down from $5 a few months ago. Good grief. Find something else to whine about.
Your responses are routinely "silly." What I'm citing is factual. Not a "feeling." Not "whining." Not grounded in bearish sentiment. Prices at the pump are rising, home heating oil this winter will be more expensive, and grocery store prices are not retreating. These are facts. The Fed has repeatedly emphasized its stand on taming inflation i.e. raising rates to 4.5% by year's end. Maybe more in 2023. And keeping it there for a while. If you are not planning/adjusting for this path, you are erring. Good luck.
If you are under 50 or your kid is under 10 it’s a great time to DCA into your 401 or 529.
I believe that is where most people have their stock exposure.
If you were within a short period to retirement or college payment you learned a lesson to protect gains
I also think if you are within 3 to 5 years of needing the money you now see the importance of diversification
The other financial lesson during a down market is control your debt and expenses
So what are peoples thoughts on High Yield Savings Accounts? I have money in my savings account at my bank collecting a whopping 0.1%. Basically its nothing.
Any legit HYSA worth getting into, and how easy is it to just transfer the money? I have not touched my savings account in over 10+ years. I deposit into it weekly, but it seems like there has to be better options.
I ended up buying some Apple and Amazon stock this week. Will probably do some DCA with these two for a little bit.
Any legit HYSA worth getting into, and how easy is it to just transfer the money? I have not touched my savings account in over 10+ years. I deposit into it weekly, but it seems like there has to be better options.
I ended up buying some Apple and Amazon stock this week. Will probably do some DCA with these two for a little bit.
We use Ally Bank and Capital One (both online):
Ally savings = 2.25%
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Capital One = 2.20%
High-Yield Rate: 360 Performance Savings | Capital One
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Both are simple and easy to use. We have been with them for well-over 10 years each.
You should also think about some tech etfs. Now is a great time to buy and long hold. IGM is a nice expanded tech index.
IGM – Portfolio – iShares Expanded Tech Sector ETF | Morningstar
IGM Portfolio - Learn more about the iShares Expanded Tech Sector ETF investment portfolio including asset allocation, stock style, stock holdings and more.
The S&P 500's forward P/E ratio has been fairly accurate at predicting bottoms
The first valuation indicator that has a pretty good track record of calling bear market bottoms is the S&P 500's forward price-to-earnings (P/E) ratio. Whereas a traditional P/E ratio examines trailing earnings over a 12-month period, a forward P/E ratio divides the price of a security (in this instance, the point value of the S&P 500 Index) into Wall Street's consensus forecast earnings for the upcoming fiscal year.Since the mid-1990s, the S&P 500 has had a number of sizable pullbacks, including the dot-com bubble, financial crisis, the coronavirus crash, and even the fourth-quarter tumble of 2018, which saw the index shed 20% of its value. With the exception of the financial crisis (2007-2009) and a sizable double-digit percentage correction in 2011, the S&P 500's forward P/E ratio has consistently found a bottom between 13 and 14.
As of Sept. 21, 2022, the S&P 500's forward P/E ratio was 15.9. Based on where the S&P 500 has been valued this century, this is a pretty inexpensive forward-year valuation. But based on what history tells us, this forward P/E would need to fall by an additional 11.95% to 18.24% for the S&P 500 to hit a bear market bottom. In point value terms, we're talking about a bottom in the range of 3,098.65 on the low side to 3,337.03 on the upside.
The Shiller P/E ratio portends a bit more downside
The other valuation indicator of interest actually does have a perfect track record of calling bear markets. I'm talking about the S&P 500's Shiller P/E ratio, which is also known as the cyclically adjusted price-to-earnings ratio, or CAPE ratio. Unlike a traditional P/E ratio, the Shiller P/E examines inflation-adjusted earnings over the past 10 years.Since 1870, there have been only five instances where the Shiller P/E ratio has surpassed and sustained a reading of 30. While there's no specific length of time that the Shiller P/E stayed above 30 in these five instances, the result was all the same: an eventual bear market. Here's how the previous five instances have shaken out:
- 1929: After Black Tuesday, the iconic Dow Jones Industrial Average(DJINDICES: ^DJI) went on to lose as much as 89% during the Great Depression
- 1997-2001: Following an all-time high Shiller P/E reading of 44.19, the dot-com bubble erased 49% of the S&P 500's value.
- Q3 2018: After surpassing a Shiller P/E of 30, the S&P 500 lost 20% of its value during the fourth quarter of 2018.
- Q4 2019-Q1 2020: With the Shiller P/E once again above 30, the coronavirus crash resulted in a peak loss of 34% for the S&P 500.
- Q3 2020-Q2 2022: The Shiller P/E peaked at 40 in January 2022. Since then, the S&P 500 has lost as much as 24% of its value.
In other words, two leading valuation indicators with a pretty good track record of calling bear market bottoms suggest the S&P 500's bear market bottom could occur between a range of 2,939.12 and 3,337.03.
LET IT FALL!!!
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The Shiller P/E Ratio is "garbage," so says the prolific hobgoblin who haunts this thread. 😉 I kid... I kid....
Have to think a 3000-3200 range is about right for a low. Buying select equities at nearly any point toward that range is advantageous. Buying indexes, though, perhaps not.
You kept on posting the Shillings P/E but I don’t remember you mentioning the bottom of PE of 22. I think we both thought 3,000-3,300 was the low but this only confirms our thinking.
Nibbled on PG, KMB, and AXP on Friday on their 52 week low. KO and MCD appears close to their low, next targets. After I finish buying all these stocks up to 70-80% of my assets, I’m a BUY and HOLD for next 10 years.
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If you don’t mind me asking, how many shares is “nibbling”? What I’ve learned is that some folks here talk a big game about buying stocks and in the meantime they are buying like 25 shares or less. Not that there is anything wrong with that but certainly puts their conviction and commitment to a stock in perspective.
10-20 shares only but I will add more every 100 pt drop in the S&P until the target 3,000-3,300. Currently, still too early to add 100 shares of any stocks. At 3,000 hopefully at 200-300 shares of a stock. It provides more visibility and easier tracking of the stock prices I‘m an impatience investor, I want the market to fall faster, been over 80% cash since about February.
T2K buying with his extra cash is difference than buying with your total assets.
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Q3 numbers are in. I’m down 25% YTD.
ETA: I hit my number to retire in February. Luckily I didn’t. 😀
ETA: I hit my number to retire in February. Luckily I didn’t. 😀
Right now I am DCA between $5 ,000 and $6,000 a month. It is going into a 529 and a second account I will most likely never need to use
I never buy individual stocks though because I do not want to do the work it takes
Same here - about -25%. Worst part for me is I had sold some winners recently and the losers I’ve been buying obviously haven’t done squat. So a lot of red other than long term holds like Alphabet and FB (which have also gotten smoked).
Shiller P/E ratio is garbage. Always has, always will. It has predicted a bear market for the past 12 years. LOL! Just the blind squirrel dynamic now.
Sounds like you haven't planned well. If you are approaching retirement, get those 2 buckets ready to go.
Through Q3:
Biggest account (T. Rowe) = -22.8% (thanks to TRAIX)
2nd biggest (Fidelity) = -24.5%
3rd biggest (E-Trade) = -25.3%
Haven't done the full portfolio calculation, but it won't be much different.
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Patience is key. My fun account is 60% in and 40% cash (waiting to add in). These are my 3x ETFs, so I am more careful than normal. I did the math and know where I need to buy to make a difference. Also thinking about converting some of my normal ETFs to 2x versions, which is more aggressive. I'm in the range to convert VB or VWTO to UWM, but not there yet for VOO to SSO.
I’m going to take your advise and convert some of my stocks over to the SSO around S&P 3,200-3,000.
Curious to know if anyone is buying Treasuries, at what duration, laddering, etc. Been buying 6-month, 12-month, 24-month issues very recently. Looking at longer terms later this year.
Been buying Treasuries maturing in Nov, December, Jan and 2 years but mostly maturing by December. I might buy some more 2-5 years when it hit 5%.
I plan to retire after I hit number. Will I actually do it is another discussion. But I’m glad I didn’t in February.
Good plan. I've targeted converting VOO to SSO around the 3,400 mark, which should get SSO to $37'ish. This would lock in a 2x return for the rally back to the ATH. Check our Morningstar's $10k return chart. It does a great job highlighting how 2x ETFs perform over time.
We don't have a number (at least yet). We have a general time, so for now, we are just trying to save/invest as much as humanly possible. Once the little one finishes HS, will do an in-depth planning session (8 years). After she is done with college, we will start making real decisions on timelines.
Good luck to us all! :)
The "problem" is one of timing with conversions to the likes of SSO. We may be in a prolonged flat period. Not a "V" recovery nor a "U" but an elongated "L" and then a climb back up towards ATHs. So a possible "dead money" situation for a bit. If it's "recreational/fun money" you're moving around, might not be as great of a concern. But even "fun money" is "real money." I like the strategy but lean more toward dividend paying equities given the likelihood of an extended flat market.
If we are in a flat period for a while, then it doesn't really matter if you use VOO or SSO for S&P 500 exposure. The issue is that rebounds normally happen very quickly and when you factor in a 2x ETFs, it may happen in a blink of an eye. Very difficult to time. Just do the math and figure out what level makes it worth the risk. I think of it this way.....whether it takes 1 month, 1 year, or 5 years, the return will be 100% with SSO vs. 50% with VOO. Simple as that.
Over the next 5 years, do you think dividends or treasuries will come close to this? Hell no. Why risk missing the rebound? Even though I have VIG or an equivalent fund in every account, I will worry more about dividend stocks and fixed income in about 10 years.
The dividend stocks could double in 5-8 year period. 5% x8 years=40% return dividend plus appreciation. Some of these stocks dropped 60% from their highs.
If dividend stocks appreciate, so will the broad indexes. Dividends are fine for income seekers, but overall returns are not better than other options just focused on appreciation. At least for the past several decades.
I think over the last 20 years utilities have kept pace with the s&p in total return . Now that includes the recent catchup and i assume the s&p will significantly outperform on a rebound but the distinction between growth and value has been minimal.
Yes. The idea is to capture via dividends whatever gains are available in the interim between the low point and the anticipated slow return to a high(er) point, as compared to parking those $ in an S&P index wherein the results would be flat for an extended period.
I don’t know how much time I have but I do know how much money I need. That’s why I use a number. It will be hard to walk away because I do like my job and the money is good. I guess it comes down to what else I can be doing with my time.
