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1929 DJIA Comparison

Discussion in 'Economics and Financials' started by 305, Feb 17, 2014.

  1. 305

    305 Brawndo Club Member

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    Get off my lawn.
    Would love to get some "financially smart" people advice on this... I was with some people referring to it today and had to take a look for myself, but I don't know enough about it unfortunately.

    [​IMG]

    http://www.marketwatch.com/story/scary-1929-market-chart-gains-traction-2014-02-11

    Found a couple articles that argued against the case back in December, but they included quotes suck as:

    Which the models continued to add up.
     
  2. CaribPhin

    CaribPhin Guest

    Two similar shapes in continuous data series mean nothing. He's using the word correlation incorrectly, or at least in a way to mislead. He's correlating two shapes. Statistical correlation determines the degree to which data points in a series fit the proposed model of that data.

    If he gets enough people scared, he could create a self fulfilling prophecy but as it is, this is a non story.

    Sent from my GT-P3110 using Tapatalk
     
  3. bigbry

    bigbry Huge Member

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    Mo is correct in his description 305.

    Not boasting but I've had really terrific timing the last 20+ years, however I cannot back it up with any statistical data. I've gone just on the feeling I'm getting. Thats it, just feeling. Market and real estate. I always keep a pulse of whats going on, and read and listen to everyone.

    The only thing I can tell you is I'm always against what everyone else is saying, always. I've tried convincing friends but the "feeling" thing just doesn't fly with them. I cant blame them either.

    An example: I sold almost all real estate investments by July 31st 2007 when I believed the recession was hitting. Real estate markets are regional but those around me started losing equity starting Aug 1st.

    As people are now getting themselves back into more debt and feeling comfortable with it, I think its going to be something they will not be able to pull themselves out of with this next go around. And yeah, my feeling is we are in for another round.

    My feeling is the numbers cannot sustain themselves.
     
  4. jw3102

    jw3102 season ticket holder

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    Congrats on your timing in selling your real estate prior to collapse in the market in 2008. Unlike you though, I stayed in the stock market throughout its decline in 2008 and early 2009. Instead of selling as the market went down, I instead continued to buy stocks as the prices became more of a bargain.

    When the market reached its low in the 6000 plus area, I showed a paper loss a little over $250,000 from what my account had been at the markets high point.

    Yet by staying in the market, instead of selling, I was able to recover all my paper losses within a year of the markets low point. By remaining in the market through the downturn and continuing to buy quality stocks at much lower prices, I have seen my overall portfolio increase over $500,000 since 2008.

    I look forward to the next market correction. When it comes, many foolish investors will once again get scared and sell their shares at a loss. I will once again remain in the market and just buy more stocks at a bargain price and wait for them to take off again when the markets go into yet another bull market.
     
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  5. bigbry

    bigbry Huge Member

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    Cost averaging beats panic selling.
     
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  6. ckparrothead

    ckparrothead Draft Forum Moderator Luxury Box

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    So the market didn't tank? That's weird. But the pretty pictures looked so convincing...
     
  7. bigbry

    bigbry Huge Member

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    2007 all over again
     
  8. CaribPhin

    CaribPhin Guest

    It was scheduled for a crash on my birthday. Would have been some interesting celebrations.
     
  9. unluckyluciano

    unluckyluciano For My Hero JetsSuck

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    probability wise many periods should resemble many other periods. This is actually a way to predict stocks in the market, although to me, a not so good way.
     
  10. unluckyluciano

    unluckyluciano For My Hero JetsSuck

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    housing will crash again due to rentals. Book it.
     
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  11. CaribPhin

    CaribPhin Guest

    Closer to 99/00 IMO. Some overvalued equities, I can give that I guess. But the difference is in 07, you had an octopus bubble. Housing seeped into different areas of the US economy and the bad mortgages became widely traded/large components of the banking industry's business and revenue. Canada, aside from top notch Central Bank and Fiscal management, has 5 banks with >80% total AUM so they weathered the crisis well because they have such robust balance sheets. A speculative asset bubble bursting would hurt, but unless I missed it, I don't see any asset classes that permeate finance enough to cause that scale of a downturn. Yellen appears to be very willing to head a SAB off at the pass anyway so I think the Fed has contingencies in place anyway.
     
  12. bigbry

    bigbry Huge Member

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    Our largest asset class is money. IMO inflation will become a ***** that refuses to leave the house after using her.
     
  13. bigbry

    bigbry Huge Member

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    Everyone wants to point at 2008 when it started but it really started in 2007, right when everyone believed there was free money out there to be had.

    I see that same type of euphoria present today.

    I can clearly see getting back into real estate by the end of this year.

    Just my humble opinion.
     
  14. unluckyluciano

    unluckyluciano For My Hero JetsSuck

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    the housing collapse started in 06. That's when people started defaulting and the mortgages started piling up.
     
  15. bigbry

    bigbry Huge Member

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    I'm sure you are right. Its regional.

    Here in Colorado In 2007 people were wondering how they were going to spend all their dough.

    In July of 07 is when it started to decline and people were just not interested in thinking it would end.
     

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