It's not the economy falling apart. Go ahead and focus on the midterm.
Yes, if the stock market is falling because wages are going up that seems like a win-win (in the short term).
When you put it that way, I worry about the midterms.
I have not been reading news this week - is that what's going on?
The president is a total shit. Paul Ryan is trying to get the House to be only 98% shit.
Who knew there was a hidden downside to empowering, supporting, and working with horrible people.
That's the explanation given in some of the media coverage. It's kind of impossible to tell exactly why the stock market does anything, but it's a plausible enough theory.
In other news, looks like the government's about to shut down again. This time it's Rand Paul's fault.
They do, but Paul is using some procedural move to delay a vote past the point when funding runs out.
And it's still not clear if there are enough votes in the House to pass it anyway.
As long as it's Republicans in Congress blocking a Republican White House, I'm feeling better about the midterm.
I have seen a couple things about how democrats are being blamed for the last shutdown, which is so clearly blame handed out by pundits, because no one has witnessed the past two years and concluded that they can understand how the public allocates blame.
How will I feed my family if the price of Tide Pods increases?
"Stocks have lost x% of gains since election" is pure bs implicitly buying into a MAGA narrative. Before the election *stocks were at an all-time high*. Corporate America never stopped booming. Stocks have what, tripled since the 2008 trough?
Rand Paul blames the budget deal for the stock sell-off:
"Your grandkids are being stuck with the bill! Mark my words, the stock market is jittery" over the debt, Paul said.
If he's so good at knowing what's going to hit and why, how'd he get coldcocked by an elderly doctor?
Based on everybody's answers in the other thread, I guess I better not say that 59 is elderly.
It's not much of a crash - most stocks are back to about where they were in, what, November? If they keep going down it's still anybody's guess what it shows -- probably just that some rich Americans and fund managers are bright enough to take their winnings off the table after a huge run of success and move into bonds.
In the long run, you could argue that US stocks are bound to go down from here because there's a big discount rate for investing in a banana republic:
http://thereformedbroker.com/2017/01/30/stock-markets-and-the-rule-of-law/
But you could also argue that, for as long a term as matters, corporate oligarchy is going to lock in profit margins and that nothing else much matters to stock prices:
https://www.ft.com/content/cd516726-46d8-11e7-8d27-59b4dd6296b8
whee, interesting times etc.
As long as I'm mature about it, you're mature about it, both of us are mature, we can achieve a certain maturation, that guarantees maturiosity.
I had been hoping to cash out my stocks to buy a house. Now I will have to cash them out for a house that is 10% smaller.
On the other hand, it if means interest rates stay low, I could come out ahead.
I took the opportunity to make my annual Roth IRA contribution as things started to slide. Don't time the market, of course, and I might feel like an idiot if it keeps sliding, but in the meantime, bargains!
11. So why is the WaPo reporting that Trump and the Republicans poll numbers are going up?
It looks like the House passed the Senate bill. Which, as I understand it, does not even include the DACA provision that McConnell promised. So what the hell did the first shutdown and cave achieve?
Nothing. They stumbled into the shutdown. They thought they had the broad outlines of a deal (DACA for wall funding), and Kelly and Miller demanded that they also repeal the Immigration Act of 1965.
The Democrats are the emotional-support hamster of America.
Anyway, according to TIAA (which I guess isn't TIAA-CREF anymore?), "This equity market correction is less about inflation fears and more about concerns that the Fed will tighten too much or too soon."
So, there you go.
TIAA is the second largest grower of wine grapes in the United States.
The stock market is down because it was absurdly overvalued; this was going to happen in Q1 regardless of any other news. I have lost a shitload of imaginary money over the past week, but it was imaginary gains during the irrational run-up to begin with so easy come easy go. The plan is to not touch any of that until I retire anyhow, so I'm just looking at this as a bad week in my fantasy finance league with a good 15 years to recover.
Investors have a long refractory period.
The Democrats are pretty fucking useless, aren't they? I thought Pelosi was nicely set up to make a fight out of it, but that was all for show.
Also, I can't be in a bad mood today, because.
27. New rules will ban emotional support hamsters from airplanes, along with peacocks and snakes. Unless of course Congress can pass a law that Democrat hamsters are certified.
The Democrats seem to have gotten a lot of their priorities funded and hostages freed. Just nothing related to immigrants.
I suppose the idea of "good immigrants who literally have done nothing wrong, even if you count immigrating as doing something wrong because they were children" polls well, but the idea of making them the top priority and holding up other issues for their benefit does not poll well. Too bad for all the people who get deported/murdered/etc.
The Democrats are the emotional-support hamster of America.
I laughed. Also, that girl goes to college in Heebieville. Represent!
I switched a non-trivial part of my 401K from a stock index fund to a bond index fund at the beginning of January. I was feeling really smug when the stock market "corrected," until I checked on what happened with the bond fund. Almost as bad.
You should have bought a house. That never goes down.
I don't see the Democrats winning a shutdown. Basically all of the parts of the government that the Republicans don't like -- the EPA, etc. -- get shut down. How is this supposed to be a credible threat?
How is this supposed to be a credible threat?
It's clearly not, given that last time the Dems abandoned it for a transparently worthless promise.
What is the best way to euthanize a hamster if you're trapped in an airport?
I think that finding somebody with an emotional-support cat would be the utility-maximizing solution.
43: There must be some distance from a jet turbine such that a hamster is sucked in but an adult human is not?
Seriously though, almost anything would be preferable than drowning in a toilet. Stepping on the hamster would have been less cruel.
Except that crushing a hamster underfoot is a fetish. Nobody wants their emotional support rodent to go into porn.
I don't understand why you wouldn't just set the hamster free in the airport. Let it feed on computer cables and such.
You could smuggle it on easily, but it might be hard to get it past TSA if you are a woman. A man could just gently put it in his back pocket and hope the x-ray tech assumes Mr. Gere is now leaving Baltimore.
46: Two birds with one stone. You strap on a pair of stilettos and rid yourself of a suddenly inconvenient emotional support companion, while at the same time producing #MonetisableContent.
Maybe it was as simply as having only brought flats for her trip.
38: Similar here, but I only moved like 3% of my pot (rebalancing to original allocation).
Bonds have gone down significantly, but not by nearly as much as stocks it looks like, no?
47: "This coffee got cold on me. Could you nuke it for a second? "
"My shoes squeak. That's not from the cup."
I only moved like 3% of my pot
Legalization has made the market more competitive than it used to be.
I have trouble with concept of re-balancing First, I'm always leery of going to talk to the TIAA people because they share a building with the Rand Corporation. Second, as near as I can tell, it involves moving money from investments that did good to those that sucked because I guess you can predict that something will stop sucking eventually because reasons.
I think the idea is that 'did good' in the past isn't a good prediction of the future. You're moving money from the investments that got lucky into the ones that didn't.
But if the differential performance was luck, moving assets won't help you*. If it wasn't luck, then moving assets hurts you. I think the implicit assumption is "this thing that did well will now do worse because it did well because late capitalism** is based unstable cycles of boom and bust". But I can't find anybody at TIAA who wants to go into that.
* Maybe you are lowering risk through diversification but if what you had before was already an index fund, I don't see how that gets to be a big deal since stocks vs bonds ought to average out over the time I expect to pass before I retire/die.
** Also, early capitalism.
Anyway, time to go home because new Pokemon are released and spend time with my family.
I thought the rebalancing idea was that as you get older you're supposed to move from assets that supposedly have more growth long term but more risk gradually but increasingly favor lower growth/less risky assets like supposedly bonds, so if the S&P 500 crashes the year you retire you are OK. But then do not take financial advice from me.
61: I remember going through a whole Q&A with a representative when I set up my Vanguard account. Questions about when I planned to retire, how much risk I was willing to accept & etc. At the end they set up a "move things into less risky assets" schedule that's supposed to happen automatically.
Of course, there wasn't a "convert savings to bitcoin" option back then.
61, 62: The major mutual fund companies seem to be doing this via creating "target date" funds like Vanguard 2030, etc. Theoretically, they handle the age based risky to safe allocation updates.
Of course, they take an extra percent out in fees (over index funds, not generic mutual funds) for the privilege.
61: That's a thing, but I'm not at the point of changing those allocations; I had chosen a 75/25 split going in, but stocks had gone up enough over time to make my account 78/22, so for me rebalancing was just swapping around 3% to go back to my original selection.
stocks vs bonds ought to average out over the time I expect to pass before I retire/die
They ought to, but I think further diversification hedges a little more against the risk that they don't.
And you need to figure there is a non-zero chance that I'm a Highlander.
62.1 is the conversation I'm trying to avoid.
Great, now there's a nonzero chance I have to behead Moby. Who will make jokes then?
I guess if we're all in a state of Highlander uncertainty about whether or not we're Highlanders (i.e., you believe there's a nonzero chance you're a Highlander) the safest move is to behead everyone around you, just in case. I think that's right. Maybe some of our resident moral philosophers could work this out formally.
The crash this week makes it possible to interpret the entire Trump administration as a giant pump-and-dump scam.
predecapitation is the new predestination
This week makes it possible to interpret the entire US economy as a pump and dump scam.
stocks vs bonds ought to average out over the time I expect to pass before I retire/die
They ought to, but I think further diversification hedges a little more against the risk that they don't.
They ought to, in some highly theoretical Econ 101 sense, but in practice, they don't. Equities have consistently returned more than bonds (in the long run). Doesn't mean you shouldn't be invested in bonds, too, but it's not about averaging out, really. It's about (inverse) correlation.