Advice is worth what you pay for it (taking a business class is a good thing...)
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Originally Posted by
ODB
If you could buy now with everything bottoming out, what do you buy?
ODB,
I don't think that the bottom is anywhere close to being in.
Cash in the bank(keep in mind FDIC insurance levels), and index funds like tsp g or their equivalent (low maintenance costs, low turnover, and run by a reputable firm) are a good place to wait out the storm. USAA has some low cost Vanguard managed offerings, and of course Vanguard has some low cost offerings (3000 or higher to start depending upon the fund) for your IRA.
If you have a work-based retirement vehicle, an IRA, an emergency fund, and are willing to throw out some additional money that you may/probably will not ever see again there are some interesting individual stocks out there to consider. Diversification risk goes way up when you purchase individual stocks :eek:. GE is a very good company that is taking it on the chin due to their GE Capital division. There is some speculation that things will continue to get worse for GE in the short term.
Investing-wise Warren Buffett is whom we all aspire to be and we all fall short. Schmedlap's method of purchasing Berkshire Hathaway is seriously worth considering. This strategy reduces your diversification risk and allows one to capitalize on Mr. Buffett's brainpower and skills :D.
I will repeat however that you must be willing to throw out some money that you may/probably will not ever see again. One of my accounts reminds me of this fact daily :rolleyes:
Best,
Steve
Was it all due to them or did they in both cases
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Originally Posted by
Ski
Greedheads on Wall St. Twice in a century - they will NEVER regain the trust of the average American.
Have a great deal of US government help?
From Gale Cincotta and Jimmy Carter and the Community Reinvestment Act to Rubin and and Summers changing the rules to aid their investment banking friends to Barney Frank and Chris Dodd stopping any restructure of Fanny Mae and Freddy Mac -- which are the two Government organs that really brought the whole structure down -- and the Fed. There's a lot of blame to go around. It wasn't all Wall Street; more DC and plain old human greed on the part of a lot of folks who created the housing bubble buying houses they couldn't afford.
As for trusting 'em, if a few bad apples in the chain had been my determining criteria I would not have stayed in the Service for 30 years. This is the fourth time in my life my stock is worth about three quarters to a half what it was a year earlier. I rarely sell, just keep buying; third stock, third cash, third other. The market goes down, the market goes up. No one really knows why...
Actually, you and I are saying the same thing
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Originally Posted by
Ski
Ken...You're wrong here....
There is widespread evidence that the current financial crisis - while given much leeway by government - was caused by almost all the major credit providers and investment banks shoveling cheap credit out to door to people who could not and should not had access to it.
I totally agree.
That's why I pointed out the three big problems of governmental action that allowed and even encouraged them to do that.
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Wall St. is dead and the trust in government is also eroding even further. It is no surprise that there is a revolving door between Wall St. and high level governmental positons with the Treasury Dept., Mint, etc...similar to the revolving door between high ranking military officials and defense contractors.
I agree with all that -- and I also know that people forget and forgive. I've been around long enough to see Wall Street get far more venom than it is getting now or is likely to in the future. I've also seen it bounce back and sell even more stock to even more people. I have no doubt that will again occur.
I've also seen government thoroughly distrusted and trashed before. Several times. Far worse than today; this government has carefully (and very wrongly in most respects) built itself up as a provider of funds and services to people who do not need those funds and services (that's called vote buying; if they targeted those in need, it would be good government, they don't -- so it isn't) thus it no longer gets nearly the vilification it once got when people knew it had screwed up -- as they do know this time.
That's one big reason Wall Street will not die.
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There are very solid reasons why the market goes up and down. While human psychology has a very definitie role to play in the market, it's not nearly as nebulous as it seems. What is nebulous and for the most part horse#### is economic theory...mainly because most ignore the irrational nature of humans.
I don't think I said it was nebulous -- I said no one really knew why it gyrated the way it does. Your suggestion about humans is the closest to being correct but that's impossible to predict ergo, the market gyrates and no one really knows why.
Economic theory does indeed have problems. Old Adam Smith got it pretty close to right 232 years ago and none of his nominal successors have done much to refine or disprove what he wrote.
This too will pass, as they say...
Won't even take that long
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Originally Posted by
Sergeant T
Sure they will, once everyone currently older than puberty is dead or feeble.
Five to eight years, max.
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Everyone's familiar with the
Glass-Stegall Act. Passed in 1933, it was repealed in 1999. There were sound and solid reasons for the law.
True. Uh, Who was SecTreas when that was repealed. Who signed the bill into law... :D
Not just poor people caused the financial collapse
...Shoveling credit out the door to poor people who shouldn't or didn't qualify for it...
This is an incomplete statement.
We also found our credit society at large giving credit to failed middle and upper income folks who didn't know, ever, how to manage their much larger incomes and estates.
So, some big income folks had equally lousy credit scores and profiles. As a real estate broker how many times have I been asked (and I refused every time) to "find a mortgage fix for Dr. so and so or lawyer so and so, whose income or cash flow is huge...but whose credit history is even bigger in terms of being BAD.