OT - Dow plunges 1,175 - worst point decline in history

[MattTuck]

Originally Posted by kevinvc

Whew, such a relief to learn that only the ignorant or poor planners can be hurt by a market crash.

I don't think he was dancing on graves. The reality is that the S&P500 essentially quadrupled from the low point during the financial crisis. Less than half of American's own stocks (either directly or indirectly), so if someone was able to benefit from that run up (whether it was artificial or not) -- a loss of 10%, or even 30%, seems pretty minor in context. Obviously some people may be depending on the money in their accounts, and losses can cause disruption and hardship. I feel for them. But compared to the vast numbers of Americans that are struggling just to get by (Only 39% of Americans had enough money in the bank to cover a $1,000 unexpected expense; https://www.cnbc.com/2018/01/18/few-...emergency.html)

The market is a risky place. The narrative that it is a place to 'invest' for retirement or college is one mostly spun by the financial services industry. What many of them advocate for is "speculating" for retirement or college -- not investing using best practices of portfolio management. Looking at the last 25 years, there seem to be several extended periods of depressed returns along with the periods of rapid price appreciation.

Be careful if you're in the market and are really depending on those assets for something in the near term.

[seanile]

Originally Posted by joosttx

networkings solves that

Young people dont have a network. Thats what the first five years of a career gets you. And, as was mentioned earlier, applicants are expected to have five years of experience in order to get an entry level job/pay.
Life isnt as easy as youre making it out to be.
Additionally, wasnt your career based on a very niche specialty that paid very well by the end, allowing you to retire in your 40s? Thats an exception to the norm for most people, so your experience doesn’t necessarily jive with others’, and therefor your advice wont necessarily be blanketly applicable.

[oldpotatoe]

Originally Posted by veloduffer

Winter (Big Dip) is coming.....

We're due for a recession and there's lots of little signs starting to accumulate - fixed investment falling rapidly (0.8% in 3Q), Brexit, Italy, Mueller, GM, latest jobs report. With all the leverage in the corporate debt market (particularly leveraged loans now at $1.5 trillion), that's the bubble to burst.

As Janet said, "Expansions rarely die of old age." At work, we are going to try to model what a corporate-led recession will look like, as the last one was in 1989. In some circles, the Financial Crisis wasn't even a 1-in-10 year stress event (14% default rate, 10% unemployment). We used a lot of fiscal and monetary stimulus
to recover from that. It's not as easy this time with the budget already near a $1 trillion deficit and the Fed trying to wind down a large balance sheet of assets.

NO magic bullets but 2020 came come soon enough...

[saab2000]

Originally Posted by oldpotatoe

NO magic bullets but 2020 came come soon enough...

As of today, there is no cohesion among the opposition so it's not unrealistic at all to think of another 4 years of chaos and disorder. I'm not sure this chaos and disorder is sustainable but right now I see nobody rising to the challenge to stop it.

[Ozz]

Originally Posted by seanile

Young people dont have a network. Thats what the first five years of a career gets you. ....

Your network starts while you are still in college....internships, parents, friends, parents of friends, etc.

It's hard and you have to put yourself out there, but work hard, show competence, willingness to learn and your network will develop.

Wait until you are out of college and expect a VP title, $100K a year and 5 wks vacation and yeah, it will be hard.

[jlwdm]

Originally Posted by Ozz

Your network starts while you are still in college....internships, parents, friends, parents of friends, etc.

It's hard and you have to put yourself out there, but work hard, show competence, willingness to learn and your network will develop.

Wait until you are out of college and expect a VP title, $100K a year and 5 wks vacation and yeah, it will be hard.

Agreed. My network started in grade school. I applied for a job out of college and a grade school friend helped me get the job. I am 71 and that is the last job I applied for. I moved states 4 times and changed careers, but every change was for a job that was offered to me or created for me.

Jeff

[oldpotatoe]

Originally Posted by saab2000

As of today, there is no cohesion among the opposition so it's not unrealistic at all to think of another 4 years of chaos and disorder. I'm not sure this chaos and disorder is sustainable but right now I see nobody rising to the challenge to stop it.

Pretty early..remember, 'it's the economy stupid'...The US is set up for another hum-dinger..BUT already at $1 Trillion of deficit, in a healthy economy..if the economy sours big time..$2trillion per year debt of QE isn't sustainable..
'read my lips, no new taxes'...???

[saab2000]

Originally Posted by jlwdm

I moved states 4 times and changed careers, but every change was for a job that was offered to me or created for me.

Jeff

This one is key. A lot of people are unwilling to move and uproot their lives. I can see both sides of this coin but sometimes it's necessary.

[verticaldoug]

Originally Posted by oldpotatoe

Pretty early..remember, 'it's the economy stupid'...The US is set up for another hum-dinger..BUT already at $1 Trillion of deficit, in a healthy economy..if the economy sours big time..$2trillion per year debt of QE isn't sustainable..
'read my lips, no new taxes'...???

I caution you that in the last quarter of 2008, the banking system was very close to collapsing. If people on both sides of the aisle had not worked together, we easily could have melted down.

I admit, part of the damage was self-inflicted when Hank Paulson thought the market was set up to handle Lehman's collapse. He greatly underestimated the interconnectedness of markets.

I think McCain hurt his chances to actually become president elect when he scuttled the first deal at the last moment.

If the market is just a little bad, it is an election issue. If the market is really bad, you do need a steady hand at the rudder. Mnuchin is no Paulson. I'd feel better if Gary Cohen was still in the administration. As more seasoned professionals leave the White House and are replaced with television commentators (Nikki Haley, etc)

Who will be the steady hand on the rudder? When markets get nervous, ill advised words can really have consequences.

[saab2000]

Originally Posted by verticaldoug

I think McCain hurt his chances to actually become president elect when he scuttled the first deal at the last moment.

I think what really hurt his chances was his "You have GOT to be kidding me" running mate. But that's a topic for somewhere else.

Yes, I think we are setting ourselves up for trouble and I hope cool, non-partisan heads can lead this nation out of this instead of the usual blame game and name calling that leads nowhere good.

[seanile]

Originally Posted by saab2000

This one is key. A lot of people are unwilling to move and uproot their lives. I can see both sides of this coin but sometimes it's necessary.

a lot of people can't afford to move

people move to cities because that's where the jobs, wages, and growth are. in order to do that, you have to save minimum of $3000 just to sign a lease when you have other roommates in the picture (first month, last month, deposit, broker's fee). my last apartment meant this was $3800, and i had 5 other housemates. $6k minimum if you want a 1 bedroom.

then add $1000 to move (truck & materials).

and maybe up to another $1000 if you have to pay an early-severance fee for cutting your current lease short.

kind of hard to gather up to $7000 when young folks who are making between $28k and $50k before taxes are also paying student debt off a $300/mo, and likely a car payment or transit pass at another $300/mo), and then just trying to live and eat, save a little for retirement, and socialize (need that network right?).

god forbid you have children and currently live near your parents and have been using them for free childcare. try and find the annual income that service requires now that you're giving up your network.


recall the aforementioned statistic about people not having $1000 of disposable income available for emergencies. now tell those same people to move.

Home Price to Income Ratios / HARVARD - http://www.jchs.harvard.edu/home-price-income-ratios
The Barriers Stopping Poor People From Moving to Better Jobs / ATLANTIC - https://www.theatlantic.com/business...ousing/542439/
Why Don’t People Who Can’t Afford Housing Just Move Where It’s Cheaper? / NYTIMES - https://www.nytimes.com/2018/05/15/u...s-cheaper.html
Further Proof That Millennials Are, in Fact, The Brokest Generation / SLATE - https://slate.com/business/2018/12/m...eneration.html

What the researchers do find is that millennials—who they define as Americans born between 1981 and 1997—are relatively broke. The average net worth—assets, minus debts—of a young adult household in 2016 was 20 percent less than baby boomer households in 1989 and 40 percent less than Gen X households in 2001. The deficit is driven in large part the by the fact that millennials are much less likely to own homes and much more likely to have student debt.

[Clean39T]

...

[veloduffer]

Given the financial status of many Americans, I’m afraid a deep recession will really break one’s spirit. This is essentially what has spurred the violence in France — many folks have been struggling and the gasoline tax was the straw that breaks the camel’s back.




Sent from my iPad using Tapatalk

[Mzilliox]

Originally Posted by seanile

Young people dont have a network. Thats what the first five years of a career gets you. And, as was mentioned earlier, applicants are expected to have five years of experience in order to get an entry level job/pay.
Life isnt as easy as youre making it out to be.
Additionally, wasnt your career based on a very niche specialty that paid very well by the end, allowing you to retire in your 40s? Thats an exception to the norm for most people, so your experience doesn’t necessarily jive with others’, and therefor your advice wont necessarily be blanketly applicable.

thanks for saying it, i was tired of making the same point over and over with only the answer to "network." All my head could hear was "privilege". if your parents did not start you on that track, if you dont get a job where you went to school, if you relocate to become employed, or if you acknowledge the reality of the job market as it is, networking as a blanket answer is naive. it may work for you, but that does't mean it works. there aare also often no ways to know if your bosses are petty, My experience was with Washington mutual bank, i think it turns out my opinions of their management were correct, as they did not survive, but how was a young idiot needing a job to know? you folks and your networks were lucky, not normal. normal people in normal towns and normal circumstances dont develop networks. like 3 kids from HS went to college, and my dad thought you could get a job with a handshake like when he was young. so wheres the network? I think you cats who have this parents getting you jobs thing dont realize thats not at all normal for the majority. thats lucky, thats good parenting, and thats not the norm. im pretty shocked to find out most people think this is normal.

[echappist]

Originally Posted by Mzilliox

thanks for saying it, i was tired of making the same point over and over with only the answer to "network." All my head could hear was "privilege". if your parents did not start you on that track, if you dont get a job where you went to school, if you relocate to become employed, or if you acknowledge the reality of the job market as it is, networking as a blanket answer is naive. it may work for you, but that does't mean it works. there aare also often no ways to know if your bosses are petty, My experience was with Washington mutual bank, i think it turns out my opinions of their management were correct, as they did not survive, but how was a young idiot needing a job to know? welcome to the rest of the world outside the bay area blanket.

this exactly