
Bull Market Hits a Milestone: 3,453 Days – Most Americans Aren’t at the Party - germinalphrase
https://www.nytimes.com/2018/08/22/business/bull-market-stocks.html
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xhrpost
> But for many seasoned stock market observers, the existence of continuing
> worries about whether the bull market can last is a strong piece of evidence
> that it can.

>According to this line of thinking, the moment to worry is when there is
broad agreement that the market can only go higher. That would suggest there
is little fresh money to drive stocks to new heights.

This is what I keep wondering about. It seems like everyone is just waiting
for the crash to happen for the last 5 years. The slightest downtick seems to
send people into a tailspin. Thus, possibly enacting it's own self balancing
mechanism? I can't tell, but then, neither can anyone else.

~~~
tabtab
It's hard to argue there is not a lemming effect in the market. If the "spook
level" reaches a certain threshold, then a mass of investors all bail out at
once, and it snowballs. Professional investors are trying to time their sell
point so that they bail early in the crash instead of late. (Warren Buffett
has mostly ignored this strategy: he just waits for good deals to appear, such
as low PE ratios, regardless of the general market trend.)

~~~
wtvanhest
Professional investors do not time markets.

~~~
the_gastropod
Sure they do! They just may or may not be any good at it.

~~~
wtvanhest
No they don't. There are a few exceptions, but the vast majority of assets are
managed but asset managers who have mandates to stay fully invested. Only
niche hedgefunds time markets.

~~~
oillio
Sector rotation is a pretty popular strategy. The manager stays fully
invested, but they move the investment to different sectors, trying to time
which sectors will be hotter than others.

Just one example of a way to stay fully invested while also timing the market.

~~~
tabtab
An example: expensive products, like new cars and refrigerators, tend to slump
more during general downturns. Thus, fund managers may shift out of car &
fridge stocks into something with smaller consumer price tags, like soda
stocks.

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didibus
Wow, 10% own 84% of all stocks. That's a bit sad.

Is it because 90% of Americans don't even have money left to invest after
their cost of living? Otherwise, where are people investing, if not the stock
market?

~~~
the_gastropod
> Is it because 90% of Americans don't even have money left to invest after
> their cost of living?

In part, I think this is true. But "cost of living" is maybe a bit broad.
_Most_ of these 90% of Americans have a poor grasp of personal finance, and
spend _way_ more on unnecessary crap than they should (car loans, credit card
debt, restaurants, alcohol, coffee, cell phone bills, cable tv, etc.). This
isn't to say that there aren't systemic problems that increase wealth
inequality (there are), but a big part of the problem is just good old
fashioned consumerism.

~~~
tindm63
So you can either spend money on useless junk that is advertised to you, or
you can buy stocks in the companies that are producing the junk and the ads.
What a choice!

~~~
the_gastropod
Or buy bonds, or real estate, or start a business, or a nuclear bomb shelter,
or build a house, or donate to charity, or whatever. These are hardly the only
two options.

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RickJWagner
Financial education is a must. So many people miss out on opportunities,
splurge when they could build for the future, etc.

When I was a young programmer (nearly 30 years ago), a retirement-age
colleague took me aside and told me that if I paid the maximum into my
retirement plan (401k) and didn't use it as an ATM, when the time came to
retire I would be very pleased with the result.

I'm not at that point yet, but I still have about a decade to go. If nothing
extraordinary happens, my friend's advice will have been very good. The market
has gone down, it has gone up, but always on an upward trajectory.

It's a crime that kids aren't taught this and other basic financial tenets
from the very first grades.

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chrischen
Inflation adjusted graph here seems to suggest that the stock market isn't
really higher than since 2008:
[https://inflationdata.com/Inflation/Inflation_Adjusted_Stock...](https://inflationdata.com/Inflation/Inflation_Adjusted_Stock_Price/NYSE_Inflation_adjusted_stock_price.asp)

~~~
dagoat
Following the link: I find it odd that his google plus pic is of him wearing a
tux, with what looks to be a pile of money on fire above him.

~~~
chrischen
I don't see that, but then I also just linked the first google result.

~~~
dagoat
It's on the side. It's also the same on his fb page, which is also on the side

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singularity2001
The very good longterm chart reminds me of the saying "The stock market is
most boring if you invest over decades: It is just a log-linear curve with
ignorable dips"

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deegles
How could a startup begin to address wealth inequality?

~~~
trevyn
Take a wealthy person, ask them what they would do if they had zero money and
connections, and teach that as a skill.

~~~
rlglwx
No. Ask a person why they are "successful" and they will give you the answer
they tell themselves. "I worked harder than others, I am smarter, I went to a
good school, etc. etc." While they think that's true, it's mostly hogwash and
most people can't tell you why they are or aren't successful.

The problem is that most of what it comes down to is luck. Luck in the sense
of time and place. People born into a wealthy family or even with two loving
parents are lucky and way more likely to be wealthy than those that were born
without.

Warren Buffett came of age in the greatest period of prosperity in American
history. Bill Gates came of age right at the time that PCs became possible.
Bezos was first to market on a new and unproven platform. Zuckerberg got lucky
because he was able to get started when broadband penetration in developing
countries was finally starting to get some traction.

No man is an island and teaching success as a skill is just silly in my
opinion.

~~~
jasonbarrah
The whole point of his question was that you take those advantages away from
those men and see what they would do. The key is their creativity and ability
to find ways to make money.

Bill Gates was actually famously asked a version of this question. (What would
you do if you were poor with no education and lived in a third world country.)
He responded "Buy Chickens".

~~~
tabtab
The one thing in common about the mega-rich is that they are _obsessed_ with
money and/or success. Warren's family members often complained he didn't spend
enough time with the family because he was in his den sifting accounting and
finance material. Warren is in love with numbers.

The thing is the obsession trait doesn't necessarily scale. If you cloned a
billion Gates', that would NOT give us a billion Microsofts. It's not a zero
sum game, but pretty close to one. There's only so much room in any given
niche.

Another thing, I've been using and following Microsoft for about 3 decades.
They didn't do anything special or innovative in my opinion, at least not
relative to their size. MS just did smart marketing, acquisitions, pricing,
and packaging. MS mostly leveraged monopoly in one category to gain another
category: not raw merit. If MS never existed, the world would be the same or
even better off: more OS and office-software choice. I have a bit more respect
for Steve Jobs: he spotted useful product configurations before any one else
(with means). MS just copied/purchased trends after it was obvious they were
catching on.

~~~
lamarpye
Really? The world would be the same if Microsoft never existed or better off?

No doubt IBM would have led innovation if not kneecapped by M$.

~~~
tabtab
I don't mean _exactly_ the same, but in terms of general innovation. There
were decent, good, and great alternatives to ALL of their key products: PC
GUI's, spreadsheets, word-processors, desktop databases, etc. Heck, they
purchased most of them from other co's. Granted, MS usually charged less, at
least initially, but that's because they took an up-front loss in that product
to gain market-share. But then stagnated once they killed competition. I know
an obvious MS-Access bug not fixed for 15 years.

------
hew
Currency devaluation (mostly)

~~~
chkdsk
Odd you would think that, considering the US dollar is extremely strong right
now relative to other global currencies and has been for the last 5 years
(save for last year).

I'd love to hear why you think this, and what information sources you're
hearing this from? I've seen this line used equally by right wing political
groups as well as left wing crypto anarchists who both seem to lack a basic
understanding of how finance works.

~~~
mslate
1\. my rent

2\. my healthcare bill

~~~
chkdsk
Those are both problems that have nothing to do with currency or the economic
concept of 'currency devaluation.'

Inflation has barely been present in the US for the last 10 years compared to
historical levels.

The reason your healthcare bill and your rent have increased much faster than
inflation (I'm guessing you're in the bay area) is because of US federal
government failings in the case of healthcare; and in terms of rent the
geographic limitations, rapid growth, and local government failings of the
area you've chosen to live in.

~~~
mslate
This is the definition of currency inflation.

Goods and services costing more in my currency than they used to—and trust me,
the housing hasn’t gotten any nicer, nor my healthcare services.

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draw_down
Well, what can you do- buy into the market _now_? If you really believe that
strongly in the idea that it's impossible to time the market then be my guest!

Your options pretty much boil down to "a crash is coming" (so says everyone
for the last 5 years), or "it's different this time" (we all know the issue
with that)

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mandeepj
Misleading article. It's not that we are continuously in the bull run from
last 3453 days. We had a few crashes in between.

~~~
tabtab
But "crash" is relative and continuous. The article defined what's
traditionally been defined as a "crash". It's like "unemployment": there may
ways to measure, each with different strengths and tradeoffs, but there are
one or two traditional "common" metrics. Politicians tend to cherry-pick
different metrics over time to fit their narrative of making them look good
and the "enemy" bad.

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tabtab
We are entering Crash Territory. 100+ years of the same general pattern;
meaning an economic "correction" is coming soon.

~~~
conanbatt
I see you like predicting 10/3 recessions.

~~~
tabtab
I'm not following. It's Occam's Razor: what's more likely: A) We will set a
record bull market & recovery duration, or B) We'll hit a recession soon.
Further, the yield curve is also near an inversion, another common pattern
preceding recessions.

~~~
conanbatt
Even a broken clock is right twice a day.

~~~
tabtab
Various metrics have predicted the majority of slumps for about 100 years.
That's like every hour, not "twice". I don't believe the pattern of slumps is
random: it's roughly a decade cycle. Inverting yield curves, PE ratios above
average (using long-term earnings), and bull market duration all point to a
likely pattern.

