Comments on: Thinking Of Moving To Cash? Read This First

By: Hindsight

Hindsight — Fri, 23 Jan 2009 20:44:55 +0000

a 25% drop would have been nice.

By: Minnesota Tom

Minnesota Tom — Sat, 25 Oct 2008 16:37:29 +0000

Well, it seems like it WAS a good idea! I would pay thousands of dollars to place my portfolio value back to where it was the 3rd week in Sept. The trouble is … no one knew how bad the fall was going to be…

By: Dividend Growth Investor

Dividend Growth Investor — Thu, 02 Oct 2008 18:55:32 +0000

Kyle,

I agree 100% with your conclusions. I especially liked the links about the futility of market timing for average investors.

I remember reading a book by a successful independent futures day trader a long time ago where he mentioned that it took him 19 years before he became profitable. If he had simply bought and held S&P 500 index fund he would have had much better results at the end of the day..

By: Until Debt Do US Part

Until Debt Do US Part — Tue, 30 Sep 2008 13:43:27 +0000

nteresting article and I understand the point you are trying to make. The one thing I would is that not everyone has a long term horizon. For example people who are coming close to retirement age may want to protect what little capital they have left so it would probably make sense for them to switch to a lower risk asset class.

Long term equities perform well but it needs to be a broad based portfolio with few transactions in order to reap the full benefits of time and capital appreciation.

By: Francois Viljoen

Francois Viljoen — Mon, 29 Sep 2008 09:15:36 +0000

I agree with you 100%.

It’s silly to play the market. Now is not the time to stress or panic. 20 years from now, this will seem like something rather insignificant.

I also did the calculations, concerning Black Monday.

Even if you invested heavily the day before the crash, if you had just forgotten about your money, then 20 years later you would have had an average growth of 14% year-on-year (taking the JSE overall index into consideration – I’m South African).

By: Curt

Curt — Thu, 25 Sep 2008 16:46:50 +0000

Interesting article. I think the actions of the fed are the critical element. I am convinced that the market is going to crash no matter what. But, if the fed stays out, we may have a one day 25% drop and from there we could begin to rebuild the economy. If that was the case, I want to sell now before the crash and then buy back after that day.

But if the fed is going to intervene with bailouts, stopping shorts and lowing interest rates to push more easy money into the credit crisis, then I think the market is going to slowly drop for several years – or it may hold up while the value of stocks becomes worthless because of massive inflation. In that case, I want to get out of the dollar and the US markets completely because my wealth will only decrease year after year.

I would rather have the 25% drop in one day, but the fed is not going to let that happen, and therefore the dollar is going to sink and the US market is going to loose value no matter what companies you own. The fed leaves me no choice but to get our of the dollar and the US market.