So where are all the liberals claiming the Russians are behind it?
To be honest, I think the left is behind most of the selloff.
Get ready for "Black Friday." And don't be too quick to rush in to buy what seem like bargains.
The market was overpriced and the public should have been put on alert. I personally am watching Wynn Resorts as a takeover by Hu Chin Wah, Ltd., the largest gaming operation in Asia. - Estaban Goolacki out
1
Unlike Robin Hood, the US Congress robs from us "Little People," poor, working taxpayers and gives to the rich! The spending bill and the recent US tax cut did NOTHING to help us "Little People," us retired workers struggling to survive on our meager Social Security. We've had virtually NO cost of living increase for almost a decade. This year we finally got 2%, enough for me to buy a daily 53-cent cup of senior coffee at McDonald's. Congress gives themselves and federal bureaucrats generous raises all the time. The "cheap money," almost zero-interest policy of the Federal Reserve Board, most of whose members represent major banks and are appointed by the President and confirmed by Congress, has, over decades, decreased the value of our US dollar, which is no longer backed by gold or silver. Each dollar has much less purchasing power than years ago. This "cheap money" policy of The Fed has contributed to large increases in housing prices, rents, medical costs, and college tuition.The record-breaking stock market indices reflect this "cheap dollar" policy, NOT an increase in the intrinsic value of the corporations. Bank and credit card fees and penalties have skyrocketed. Bank of America recently charged me $35 for a 33-cent overdraft, and charges $10 each time (over 6 per month) I transfer small amounts from my own savings account to my own checking account at the ATM. This "Bankers' Tax on the Poor" hurts low-income people, the "Little People" who pay taxes.
2
It is time to give a rest to the opinion that gullible investors think the stock market always goes up. I doubt that anyone who put money in the markets ever thought that was true.
3
Stocks were over priced. If the march upward should begin again major improvements in the US economy would have to be accomplished. Fixing the infrastructure and health care system among two. But as of now the Rs have passed a ridiculous march into darkness corporate tax cut and continue to increase gov't spending. This seems to be the catalysts for the increase in inflation as well as bankers fears that wage increases are inherently inflationary and "bad" for profits.
1
I wonder if Trump will accuse the market of being "treasonous" for having gone down so drastically in a week?
3
Interest rates historically low. Nearly “full” employment. Corporate tax cuts at maximum. There is simply no other direction for business profits (and stock market values) to go, other than flat or down. What’s left? The unknown impact of Trump over-stimulation via excessive tax cuts and largely non-productive over-spending. If a major recession should arrive, he has already emptied both barrels. The government will be left with no tools to soften the blow. Trump is running the country exactly how he has conducted his life. DJT has always had whipsaw existence of reckless overspending on ego pleasing toys, alternating with a flirtation around bankruptcy and ruin. Let us hope the stock market’s wild ride doesn’t turn into the economic canary in a Trump coal mine.
7
I admit I have no understanding or background in finance or the market but I wonder if the erratic government we have now - namely Trump and his tearing down of all norms of decency could have an effect on the markets. We don't have a sense of stability anymore and everything has changed. There is a
lack of decency and it has permeated our lives. Maybe I'm too "old guard" to
grasp it - I am past 85 now - but the quality of life has changed- worse than ever -with no guide posts left.I was on a bus yesterday and a well-dressed woman with a cane chatted with me. As she left, she spoke out, "There is no decency left". Some people heard her and nodded their heads. So we have swinging markets, disruptions, scandals in the White House, idiot parades being suggested for the pleasure of our Dear Leader? Where did the standards go? Where are the statesmen and women? Maybe politics and the economy are joining in a disruption , maybe that's whats happening now? And whatever happened to the Republicans? Scary stuff....How do we deal with all this?
I'm ready to March.
7
“Debt do apart”
The trillions of $ in debt has to unravel.
This is a long unwieldy unwinding is going to take a few notable speculators down the road to pauperism.
Banks,Financial houses will be very much effected.
The BIG BEAR is here to stay.
The hugs getting squeezier.
1
Do you really think the average person or even the average New York Times reader understands a log scale on a graph?? And if you're really trying to show "comparable percentage changes", then you can't make the floor of the graph 500. The graph LOOKS LIKE the 2008-2009 change is a loss of three-quarters of the value of the Index, even though the words tell us this loss was actually 57%. Needlessly confusing...
4
Remember, the crash has not happened yet. This is just a prelude. We are still circling the abyss like a coin in one of those spinning funnels. Wait at least until Monday. All comments now are premature--no one, including myself, has yet taken in the scope of this coming financial catastrophe.
3
As long as our Congress approves deficit spending, the world will respond.
6
Just watch, when the dust settles from this one, it will be just like the other ones... socialize the losses and privatize the gains! This time the Fed will be almost tapped out from the get go and the congress might not be able to borrow much more... Oh well, if you have some cash there will be some big sales.
5
Markets take a few steps up and a few steps down. Over time they take more steps up then down. Patience and Fortitude !
2
When the stocks were soaring, Trump was out beating on his chest almost daily on Twitter. Now they are taking a beating all we get is silence from Trump. Can't have it both ways.
1
So, Millennials, what goes up always come down. Just remember that the next time someone tells you how much better off you are with a 401 instead of a pension. I know that is still 30 years or so down the road, but do you really want to spend the rest of your life on this kind of financial yo-yo? The corporations want you to.
2
No one ever has ever said one is better off with a 401K than a pension. Companies are better off if we all have 401Ks than pensions.
2
That’s exactly right and my point is the corporations prostituted the original idea of 401s when they came about in the late 70s... to supplement pensions, not to replace them.Companies would be better off if we worked for free, too, which in our race to the bottom, we kinda seem like we are heading.
4
The whole thing is a scam.
Real work for Real Outcome and Product. No Lending. No debt. Simplify everything. Day to Day existence. No "Security". No "ownership". Cooperative living.
Die with nothing.
4
pfft. Buy a house you want to live in, having saved enough for a decent down payment. Get the best education you can without debt that outstrips the likely earnings from that education. Stay healthy, save money, don't buy silly things and most things are silly. Eat well. Love well. Die happy.
2
Since excessive government spending and debt leads to inflation, rising interest rates and lower stock prices then blame the lawyer run and lawyer dominated U.S. Congress for approving policies designed to drive the lawyer run American government into deeper bankruptcy. We constantly inform governments and others in middle east not to be angry at the American people over these policies but instead blame the lawyers who run and dominate all branches of the bankrupt American government.
4
Such great times we live in- My portfolio down at least 10%, the government will shut down in about an hour for the second time this year and it's only week 2 of Feb. Our soldiers are still in Afghanistan and no one seems to be able to explain why, Trump abuses women but doesn't lose his job while his buddies all lose theirs AND he is planning a parade- to celebrate what exactly?
5
I find it increasingly horrifying that the majority of the country's wealth and savings are contingent on a volatile barely regulated casino motivated by greed, deception and gambling. What happened to the world where you put money in a savings account and it earned enough interest for you to retire comfortably? We have given the hen house to the foxes and soon we will only be left with feathers and blood.
6
This stock market plunge is only a warning. Unfortunately the Republican base and party has stopped relying on facts but now are driven by blind dogma. Just like the gun issue, their solution to this debt, deregulation and overall incompetent management, will be more debt, deregulation and at least 3 more years of incompetency. The strong health of the economy cannot resist bad management for ever, immuable economic forces will eventually catch up and poor decision-making at the top will only make the crisis worse. You don't run the biggest economy in the world like a Trump casino.
5
If there is a major market meltdown now at least Trump and the Republicans will have to deal with the results of their folly instead of being able to stick it to an incoming Democratic administration. I bet the Republicans were counting on getting away with it again.
3
old capitalism" save, invest, hold. create prosperity.
new capitalism: borrow, invest, pump, dump, create chaos.
5
how long will it take for us to correlate the trump chaos with events we are not used to experiencing?
3
We went from bigly to bear market talk in a heartbeat. Wow.
1
With a falling market, will Trump have one more incentive to start a war in order to distract?
1
I honestly can't believe that no one in the media is attributing this market tailspin to Trump's behavior in office over the last week. Strutting, pouting, colluding with members of Congress to obstruct justice, threatening the rest of Congress with a government shutdown.
Friday, the DOW fell 666 points, coinciding with the release of the Nunes memo, which indicated collusion between the branches of government that are supposed to be supplying checks and balances to each other.
Monday, the market fell another 1,145.
On Tuesday, though, when Trump shut up for a minute and quit blustering and taking credit for the market's bull run, or bellyaching about the Russia conspiracy, the market regained some of its losses.
But then on Wednesday, Trump said, essentially, that he was hoping for a government shutdown—badgering Congress to do what he wanted or he would be happy if the government shut down.
Humans may be able to absorb and blow off this kind of nonsense, but the bots who actually control the stock market are not emotional. Unlike human investors, who will stick with Trump out of greed—and blame things like interest rates and an overheated economy—bots aren't greedy, because greed is an emotion bots are incapable of feeling.
Listen to the bots. Learn from them. They see imminent chaos more clearly. Stick with Trump, and humans will lose all the wealth they've accumulated since Jan. 2017, but the bots will not feel the loss.
2
And it couldn't happen on a nicer guy's watch.
2
(Apologies to the writer of Blade Runner) Do automated trading robots dream of how to enjoy their 'winnings'?
Don't worry the prices will go higher while the wages stay stagnant.
3
Not Rocket science.
The recent growth, at least in part, reflected anticipation of the tax cuts.
The recent troubles, at least in part, reflect a wake up to the reality of paying for them amidst political uncertainty.
5
"The recent growth, at least in part, reflected anticipation of the tax cuts."
You are just parroting the same simple sound-byte the newsmedia is blathering over and over. You might want to ask who is saying that and why? Sometimes things really are more complicated than you are being told.
3
@K Henderson NYC
You think the huge cuts in corporate tax had nothing to do with the run up in stock prices? You might want to ask yourself a few questions.
2
John that is not what I said.
'“We’ve been trained that the market does nothing but go up,” Bruce McCain, chief investment strategist at Key Private Bank, said of investors. “And then suddenly, they’re anxious, they’re sitting nervously on the sidelines, and then they can’t take it anymore.'
Oh, come on! The "Great Recession" was only 9 years ago. Any adult who thinks that the market "does nothing but go up" is either too naïve to be allowed out alone or too optimistic to be safe without a keeper.
15
I know. That quote is clueless and it should not have been included in the article because it is so clueless.
5
Past performance is no guarantee of future results. Buy low, sell high! Some of us learned that a long time ago. Anybody who doesn't learn these lessons deserve what they get.
Wish I were smart enough to figure out how to short. Oh well, I think it's immoral to short anyway....
1
The central question should be whether the business fundamentals are changing. Long-term investors in companies which continue to deliver products and services that people want, and continue to earn a profit, will thrive.
The panic we see is from people who were in the market for short-term gains, using it more as a casino or a way to make money without working for it.
But if you own stocks or shares, you own part of a business, something that has a real, tangible value, which is independent of the shenenagans of the Wall Street investors betting on whether it will increase or decrease.
There were two fundamental factors at work this week.
1. Stocks were overpriced. This was not news. Why should the price/earnings ratio today be dramatically higher than in the past - maybe as a short-term bet, but not as a long-term investment strategy. So the correction makes sense.
2. The potential of an increase in interest rates made bets on stocks a little bit less attractive to these very fickle investors who want the fastest profits. But interest rate rises will have only a small impact on the profitability of the company in which you hold shares over the next 20 years.
Basically, beneath all the hype, a stock or share has a real value, and given time, it will tend to revert to that. If you trust the fundamentals of the company to succeed in the long term - are they still investing in R&D, are they making the right strategic moves - then don't worry about the stock-market!
2
Any millennial looking at this pullback should only see dollar signs as this is a beautiful buying opportunity for the long haul (10 Years).
4
Yup! Haven't heard Trumpty Dumpty pat himself on his back about "his" market for about a week, since it began to tank.
Time for the Donald to have his evangelicals hold a prayer fest to bring his market and his orange hair back. Putrid yellow and gray just doesn’t cut it.
6
So much is interconnected that makes up the economy.
But we have a split the economy in two parts: one economy for us who work and spend and save for retirement, and a separate economy for the wealthiest whose "work" is investment, and their "spending" buys them a distant world to inhabit we cannot ever access.
We traffic in one currency with a handful of 0's, they in another with a dozen. Our currency is active, circulating and alive, theirs is static, hoarded and cold. Our currency is extremely weak and their currency is extremely strong, and when they trade against each other one bill of theirs buys thousands of bills of ours. This leads me to posit an economic theorem: the stronger the currency the more static, isolated and cold it is, the weaker the currency, the more active, circulating and a live it is.
So, when our economy is doing well, theirs sinks, and when theirs is doing well, ours sinks: it's a zero-sum economic reality, when life surges, death shrinks and when death surges, life shrinks. We are life, they are death, and in the end, death always wins.
5
If the SEC would implement a per-share trading tax of $0.0001, the computer-driven trading would slow-up significantly while the average investor wouldn't even notice the difference. Computer algorithm trading is driving the volatility, and it is simply feeding on itself.
The Good News is that US stocks are now on sale at 10% off their prices from 2 weeks ago. If you were an investor then (as opposed to a trader), there is little reason to fret, much less sell. Many would argue that this is looking like a good time to Buy.
Warren Buffet once said "Be fearful when others are greedy and be greedy when others are fearful." Good advice from one of the richest investors in America.
12
1) Wage-push inflation is good for the working class. Prices go up for everyone, and the "fewer-someones" who work for wages get all of the gain, paid by those who do not take wages. Higher wages must not be an excuse to choke off the economy until unemployment forces workers to bid down each other's wages.
2) The ongoing upward distribution of income (circa 1925, and again since 2000) leads to bubbles, because due to the lower marginal propensity to consume, the rich "over-invest" and then the bubbles burst and the "wealth" is wiped out. Better to have a circa 1964 distribution of income and taxes and have a sustainable system.
17
Trump has put in place policies that discourage research and innovation in climate change and renewable energy. This economically hurts our country.
Trump favors coal and oil production, and dismisses renewable energy - This ultimately hurts innovation in investment in the US, and ultimately will lead to the US falling behind other more innovative economies.
Trump's constant disparaging comments about immigrants has made it harder to attract talent to the US, especially in high tech. Once again, this has the effect of the US falling behind other countries in innovation and investment in the long term.
11
Back when I cared about stocks I kept an eye on Brazil's Bovespa just because it was entertaining to watch daily 4% swings. I've thought more about that lately as the Dow soared beyond 20K. Have fun y'all!
2
The "cheap money," almost zero-interest policy of the Federal Reserve Board, most of whose members represent major Wall Street banks and are appointed by the President and confirmed by Congress, has, over decades, decreased the value of our US dollar, which is no longer backed by gold or silver. Each dollar has much less purchasing power than years ago. This "cheap money" policy of The Fed has contributed to large increases in housing prices, rents, medical costs, and college tuition.The record-breaking stock market indices reflect this "cheap dollar" policy, NOT an increase in the intrinsic value of the corporations. Bank and credit card fees and penalties have skyrocketed. Bank of America recently charged me $35 for a 33-cent overdraft, and charges $10 each time (over 6 per month) I transfer small amounts from my own savings account to my own checking account at the ATM. This "Bankers' Tax on the Poor" hurts low-income people, the "Little People" who pay taxes. Many of our large, federally-regulated banks including Bank of America and Wells-Fargo no longer make small consumer loans, forcing us to borrow from payday loan sharks at 200-450% APR!
9
try a credit union instead.
1
As far as I am concerned, the stock market reacted to the report that wages rose. For stakeholders, rising wages are not good. Stakeholders want all the profits for themselves. If Bernie Sanders and Elizabeth Warren were running the show this would not have happened. It would not have happened because they would have dismantled the capitalist system; that is after securing their own assets. After which they would institute a Marxist-Socialist-Leninist utopia, in which everyone would work according to their ability and according to their need. Hey, isn't that true to some extent already?
4
Nothing happens overnight, boy. Not even in 10-12 months. I think we would have survived Bernie's "worker's paradise" up till now had he been elected.
The stocks market is simply overvalued by 17% and here is why:
1) In the past 7 years, many toxic ETF and ETN have been created and the investors (who considered they are better than anyone else) are realizing their mistake and the market is selling the junks ans pull down the entire stocks together.
2) The news of the rising wage could be seen positive for the average Joe but it is not because the rising wage is not in correlation with the GDP growth (still below target), it means that the market considers that US is becoming less competitive in export and therefore increasing our trade deficit;
3) Because of an increase of deficit and lack of competitiveness, the feds will have to increase the interest rates much faster than expected and today the market just realized that the Bank of England is in similar pattern;
4)Many companies have closed their budgets for this year and the shareholders are realizing that the money saved by the companies will go to them but will be reinvested inside the company therefore less dividends than planned;
5) based on numerous datas, it is quite certain that we are heading to a recession by mid 2019: excess inventory on real estate, increasing debts, shift on consumer habits these past two months,etc...
10
Use to project future economics of US economy, the difference between Republican and Democrat governing.
PoliticsThatWork Change in Unemployment Rate by Party of President- Since 1945
Each party has held the presidency for the same number of years since 1945. During those years, the unemployment rate has risen 11.8% under Republican presidents and has fallen 7.2% under Democratic presidents. Unemployment has fallen during the overwhelming majority of Democratic years since 1949. Unemployment rose steadily under Republicans up until 1982, then fell during the remaining Reagan years, and then rose again under both Bush Presidents.
PoliticsThatWork Dow Jones Performance by the Party of the President
During the most recent 15 years during which Republicans have held the presidency, the value of the Dow has increased by 42%. During the Democratic presidencies, it has increased by 609%- 14.5 times faster. The average growth in the value of the Dow under Democrats during this period has been 14.75% and under Republicans it has been 5.11%.
PoliticsThatWork Change in Disposable Income Since 1930 by the Party of the President
In the 44 years that we have had Democratic presidents since 1930, the real per-capita disposable income has increased 271%. During the 40 years during which we have had Republican presidents, it has increased 44%. On average, it has increased 3.1% (after adjusting for inflation) under Democratic presidents and 1% under Republican presidents.
15
When you have a stock market that drops like a rock on the prospect of higher wages for workers (shocking!), that should be the tip off that the U.S. financial system is existentially rooted in gross inequality, capital accumulation and concentration at any cost, and, of course, GREED.
45
It still just boils down to inflation.
It took Wall Street 1 year, 2 months, and 2 weeks to realize who won the 2016 presidential election.
46
Making this the front-page headline increases the likelihood that people will overreact. Using words like "plunge" feed into fear. If calm minds prevail, this doesn't have to turn into anything more serious than an overdue return to earth.
9
Of course, this is brought to us by the omnipotent powers of our Beloved Leader....just like he brought us record highs and record low unemployment. Only he can fix it...he's fixed it - good!
4
What goes up must come down
Spinnin' wheel got to go 'round
Talkin' 'bout your troubles it's a cryin' sin
Ride a painted pony let the spinnin' wheel spin
You got no money and you got no home
Spinnin' wheel all alone
Talkin' 'bout your troubles and you, you never learn
Ride a painted pony let the spinnin' wheel turn
6
Everytime these "corrections" happen, some supposedly smart person says something stupid, like "We've been trained that the market does nothing but go up." Good lord. No wonder we elected Trump. We're stupid.
20
OK, I could make this all about Trump and maybe get a "recommend" or two (or 2 hundred like those "Readers' Picks" who did). But what I fear is that it's really about debt and more debt and ... well, you get the picture. Which ain't just Trump's doing, though he's made it worse with his $1.5 trillion debt financed tax cut.
Most egregiously, though, are the Central Banks (including our illustrious Fed) which had all these fancy algorithms and paradigms and really, really smart people who figured that all they had to do when markets tanked because of the easy-money bubble in 2008 was to, simply, create another bubble caused by even easier money.
Except, oops, this time the easy money fix ain't no longer available as there's already extremely low interest rates and all those bonds held by the Fed in their "quantitative easing" to pump even more money into the economy have not yet been sold to real people investing "real" money. So who's going to buy more? Especially when the money needed to buy them (or even to buy a loaf of bread) will eventually require a wheelbarrow full of cash.
Nope, NY Times readers. continue to rely on Saint Krugman. To keep everyone fat and happy, just keep creating more monopoly money.
If we do, then bitcoin might actually become a wise investment as it doesn't rely on Krugman-types to tell us when and how much to print more green paper (yep, in the end, that' EXACTLY what money is when it loses the trust of those who use it --- PAPER!)
5
Why is this correction a surprise ? At it's peak, the S&P was up 37% since Nov 2016, with a third of that gain coming from P/E expansion. Even now, it's up 24% or so.
Even after this correction, P/E stands at 24 , compared to historical average of 16. Still overvalued.
18
This so-called correction is Russian manipulation.
6
My retirement assets are taking a hit, but I'm liking the Democrats' chances in 2018 more and more each day since the stock market stopped "cooperating" for Trump.
As for Schadenfreude, well, there's the fact that wealthy people own stock, and lots of it. So the 1% are getting their butts kicked. Sure, a handful will have pulled out of equities at just the right time, but I can assure everyone that wealth management firms can't predict market swings any better than anyone else, so the vast majority of the 1% -- including Trump, are watching their portfolios shrink, bigly.
19
no ALB, the 1% have already sold anything worth selling before the big dive happens and now they will now simply wait a few years. Convert some asserts to real estate in the meantime, etc.
"My retirement assets are taking a hit"
Your retirement assets are where they were less than three months ago (Nov.28th, 2017). They are still up over 20% from Feb.8, 2017 (one year ago).
If that is "taking a hit"......perhaps your logic is clouded by greed.
I’m A single female in my 60s. Forced 3/4 time. 120k in savings. No property, no debt. I won’t be retiring either.
13
Keep working. The trading robot paradigms need someone to feed them.
Ehh. As the chart shows, this correction so far is smaller than those of 2010, 2011, 2015, and 2016. But by all means, sell now and lock in those losses! It creates more buying opportunities for the rest of us.
11
You have reached the United States, we are sorry but there is no one to help you right now. We are experiencing technical difficulties.
30
Why are these market drops referred to as "corrections?" Does that mean that prices after the drops are more "correct" than they were before the drops? How would one know? And if they were "corrections," were subsequent market rises "incorrections?"
The market has quadrupled in 9 years. Either that's inflation, or the market was "incorrectly" priced in 2009.
Let us confine ourselves to discussing market price "advances" and "retreats," or something that sounds more intelligent than "corrections," and less like we don't know what we're talking about.
4
Actually, "corrections" is the correct term in economics for market losses of 10-20%. After 20%, it's a bear market. Just like 2 straight quarters of negative growth is a recession, 10% drop in market is a correction.
I will also point out that use of terms like "correction" is based on the hypothesis that the market has all the information necessary to determine the true value of an asset and thus is in the best position to most efficiently allocate capital. Whether you believe that or not, your assumption that the true "correct" price is a static number that is unchanging is incorrect. Just because a market corrected itself does not invalid subsequent changes as conditions change over time. Also, your assumption that it's either inflation or incorrect pricing in the market is also a false dichotomy. Real economic growth is still a thing.
4
Start calling it like it Is.
We are witnessing the "TRUMP DUMP".
32
It's disquieting- ABSOLUTELY
It's eye-popping- ABSOLUTELY
Something is broken!! It's called a dysfunctional White House!!
Deregulation
Incompetent people in key positions
Unstable, erratic, mercurial leader
Indictments/impeachment/plea deals all on the table
global instability due to Trump
Wife beaters and generals gone rogue!!
Time to Retrench?
20
So, Donald, if you take credit for the rise, you have to take credit for the fall, too, right?
Crickets.
19
As they might say in a movie script developed by Netflex in the halls of congress;'it's the memo stupid'. Markets and potential autocrats and oligarchs do not mix; only in Russia and China that is....They will be buying your shares cheap. Criminal politicians moving illicit gains through their breathren. Ask THE DONALD!
9
I don't believe in coincidences. Janet Yellen served her last day as Fed Chair this past Friday. Starting that day, and since then, we have been on a wild ride, to the downside.
I don't believe in coincidences.
23
It's not a coincidence. It's a mistake. :)
5
Yellen, the only Fed chair NOT to get reappointed, this despite her wildly successful low-key "steady as she goes" philosophy. Why not?
1) Trump despises and resents Obama, which includes a demonstrably racial aspect. Since Yellen an Obama holdover, ergo Trump hates Yellen.
2) Blatant Trump sexism, especially toward older professional women. Like Hillary.
2
Yes, it's yukky. But any wealth manager worth his 2% has (one hope's) a cache of cash ready to sow.
2
As I've previously commented to Krugman:
However, the real undiagnosed and potentially existential damage is what the talking-head promoters of CNBC et al. don't have any appreciation of comes from the fact that none of these phonies have any understanding of what happens to the financial sector of an Empire when that Empire starts to collapse --- which is exactly what is happening now.
Of course, Paul is also entirely correct that the brain-power is measured in fractional horsepower when dealing with arrogant idiots like Mnuchin and Powell.
As Mae West famously said, "Keep your boots on cowboy, this is going to be a rough ride".
9
Don't call it a "correction". Call it a "Trump Rally".
7
But I noticed that New York Times shares went up over 10 percent today.
5
When you don't send wall street criminals to prison they will continue to commit crimes until you do.
13
Donald Trump took credit for the soaring stock market on February 1st, just two days after the first tumble. The next day the market really plunged, setting a new record for a one-day decline, and continues to do so.
So much for your narcissistic boasting, DT. Or is it PT, as in Barnum?
5
Experienced investors have been selling off profits for the past few years, figuring there will be a drop eventually, and use the cash to get back in at low prices. In fact the market is still high, so you could still be selling now to take profit. Mostly, for long term investors like most of us regular people, just hang on. When the market seems to be in a dreadful chasm, don't be selling. Be buying. Frankly, I'd rather be getting 4 or 5 percent in a savings account, but those days are over.
15
I'm afraid Trump's tax cut will cause the economy to stall, just as George W. Bush's did. Tax cuts, especially when the economy is doing well (low interest rates and unemployment) are unnecessary and a huge mistake.
Republicans don't learn from the past. They don't even care about the past. The question is, will Trump and Republicans get blamed if the economy slows down.
33
No. Republicans are only responsible for good things. It is all the time the same: they ruin economy and let a mess for democrats while blaming them for the bad economical situation. Once democrats fixed the econmoy they take office again, applauding themselves for the good situation. They understand themselves as experts so they crash it once again...
6
That's precisely what economists say, don't overheat a full-employement market
2
I genuinely understand the reflex to blame Donald Trump. But the markets are cyclical, and moves both up and down are most often technical. In fact, momentum can actually be calculated in what is called "measured moves." The fact is, the market always retests its highs; and only when it fails and double tops does it try the other direction. So, how to trade or invest really relates to your timeframe.
But, the point I want to make is simple. We should be more worried about who can actually access markets and real estate, and who gets hurt. Inflation can be just as bad as recessions if you live paycheck to paycheck. And most only make the few meagre percentages the banks offer. Worse, due to missing a bill here or there, their credit rating dives and they get killed on their mortgage -- assuming they are lucky enough to own. And credit agencies service banks.
So, the issue isn't corrections -- which are very difficult to time. The issue is who is working on income inequality solutions, in very practical terms, and predatory structures? Blaming one party or the other does a disservice to the issue of our time. (I am Canadian and progressive.)
7
Correct .It has been stacked against thw working class for way too long.
The minimum wage has barely moved since when ? what is happening
here is that the possibility of raising the interest rate and having CEO
and shareholder easy money go BYE BYE .Oh no , that can't be .
4
I recall entirely too well what happens when trading programs really kick in. 10/19/1987, my 32d b-day, I was working the 30-yr Bond Room at CBOT when the stochastic programs internationally sent out the sell signals en masse. These were relatively primitive apps compared to those used today, and the fact that there are numerous models now, compared to basically slight variations on one model then, will probably prevent something like that huge percentage, across-the-board sell-off from happening again. But the jolt was so sudden, the one-day drop so massive, and cleaning up the mess afterward was so disheartening that I got off the floor shortly thereafter and never went back.
5
To help pay for the Republican tax cuts, greater government spending and the ever growing budget deficit the U.S. will need to borrow more than a trillion dollars this year alone. Rising interest rates on debt to make it more saleable is just the start. Economists will say tax cuts aren’t always good, and this will become the textbook example.
17
Keep a close eye on the Social Security Trust Fund.
That will be the first place Ryan and McConnell will try to rob to cover themselves and their king. Particularly Ryan - he's been gunning to rob SS more for years, even though it saved his own family when his father died young.
He has forgotten that Atlas Shrugged is fiction and that Ayn Rand collected Social Security in her older years.
1
Don’t know or particularly care what the stock market does, as I’m not invested but it was nice when we had a president who didn’t crow about it- even though it grew 140% under his tenure. Class.
28
Much more likely than a bear market at a 20% drop, is a buying opportunity, toy government or not.
Just another wall street scam designed by big investors; i.e. " sell high buy back low take the profit" ! Only small investors, like me, can't join-in on the scam: We can't pay the fees to sell/buy-back; big investors pay nothing to buy and sell.
I have watched this cycle too many years to not understand the purposely-induced panic. Welcome to capitalism...
4
Why are you worried about transaction fees? Almost every investor ought to be able to avoid high fees now. You can put $1,000 into a mutual fund (or $10,000 or $100,000) and spend just a few dollars to buy and sell fund shares. Or other securities. But ff fear of transaction fees is keeping you from trading that may be good for other reasons. It's nearly impossible to time the market successfully, and you're as likely to sell low and buy high as not. If you've seen so many cycles you are probably aware that holding onto your investments is the best approach if don't need the funds right now.
8
You could have bought and sold an index fund or ETF for nothing at Vanguard, etc any time you wanted to.
5
Stan: Most small investors are not "day-traders", (as I suspect you are one ?) Even small trading fees , for stocks, affects our bottom-line.
Your classic Ending Statement is the most significant: "...holding onto your investments is the best approach if you don't need funds right now". Agreed...buy a good investment, well researched, and hold it, long term.
2
In light of all this I don't see the Fed raising rates in the near future.
4
Here we go again... We've been through this, when now?, oh, that's right, in 2007. When will we ever learn that recent history has shown that the great and glorious "business men" (and women) in the White House and Congress have a penchant for driving our economy over the cliff, in free-fall. When will they and we learn that Wall Street and those - to quote President Obama - "fat cats" in high finance are not to be trusted..ever?
And, folks, the "tax cuts" have not really even begun its journey of destruction. When it does, it is a certainty that there will be no "trickle down" effect; rather, the money to be gained will stay right in those deep pockets of our CEO's and their ilk.
Any ideas for another President Obama to get us back on track? A Democrat, of course...
9
So who is doing the selling? The big boys with computer-driven trading or your individual mom and dad investor? To what extent is short selling going on?
2
Great news, as the stock prices have rise since election-day 2016 in a manner which was unrelated to financial news and that rise put further distance between the "haves and the have nots". It also takes off of the board the Trump boasting of the stock market's advances. Well, nothing will stop that bloated bag of 'spit' from taking credit for everything which works and absolving himself for being responsible for anything which does not work.
6
Yes, after much critical thinking, I confidently arrive at the conclusion that politics is the reason stocks have been sliding for one whole week
3
Mr. Market came to my front door today and said I wasn’t worth as much as he thought yesterday. He said he would come back tomorrow and let me know again what he thought. I thanked him and closed the door and continued about my business.
1
Really no need for panic , the correction is to take an irrational market to a more normal one.
Maybe there is over the next few months a further correction in store that's okay
However where I challenge the assertions of Trumps lackeys is their claim the fundamentals are strong and they are looking long term.
Thanks to their irresponsible tax act , inflation and interest rates will increase eroding any tax increase benefits for the middle class dampening the driver of growth consumer expenditure.
Government debt will grow by over a trillion dollars a year and this at a time of relative prosperity ( compared to the recession and wars President Obama inherited) this will put further pressure on international money markets. See Bank of England statement today
Consumer debt levels are maxed out at record levels
Corporate profitability will be reduced by higher raw material costs, higher interest rates, lower demand from 2019 and shortage of skilled people.
A recipe for an economic downturn in line with the inevitable economic cycle.
This is why Wall Street is coming to its senses , it sees now that the Tax Act is a negative for our long term economy.
America deserves better than this disasterous Republican leadership and Presidency.
Maybe Biden for 2020 he has successful experience in cleaning up after Republicans
4
This is traders. They sell high, then they ride the wave down. They buy back for less, then they goose it up again, sell and take more profits, and take it back down to stock up for the next upward move.
5
Well, yeah, Mike. That's the way it's always been. Why would it change now?
3
This correction was inevitable once the new tax law went through-it was the signal for profit taking, along with Janet Yellen's leaving-a big mistake by Trump-and the growing national debt. Good times are over, until the Democrats get back in charge of Congress, and hopefully, The White House.
13
Anyone who's young and in the accumulation stage should be thrilled at the prospect of a bear market. This is how you build wealth: by continuing to invest according to your asset allocation when the market tanks. If this concept is foreign to you, then you need to educate yourself. Go to bogleheads.org and start reading.
2
My mantra was don't fight the Fed as it rose for years, and rose with it.
Now the Fed is done and the Fed-created bubble will slowly deflate like a balloon with a pinprick.
1
Volumes have been written on the stock market. It really isn’t very interesting. It just goes up and down. Throw a ball and it can go up and down, sideways and it can roll or bounce on for a long time. We think dogs are silly for fetching balls. But they do a lot of different things compared to the market.
1
Does this mean the parade is postponed?
22
Just watch. I bet that in less than 24 hours, someone on the Republican Party side, most likely Trump himself but possibly one of his boot-lickers, will blame his on Obama, Hillary, the Democrats, or all three.
And I absolutely guarantee that even if it doesn't happen in the next 24 hours, it will definitely happen thereafter if things continue in this downward direction.
5
It already has -- viz Hannity
1
There you go. These Republicans are nothing if not predictable.
The stock market is not the economy.
It wasn't in 2008, nor in 1987, nor in 1929, is that correct?
3
My God, a correction...forgot about those. Seems like it's been about a year since we had one of this magnitude. Well, only a fool trades money he needs short term, and only a bigger fool sells in a panic and only a bigger fool yet, imputes some kind of morality to the whole affair. Although, I have to admit. My bourbon tastes richer knowing that it's happening on the Donald's watch.
2
It IS a big deal if you have a 403b, IRA/Roth account and planned to retire at years end. I know co-workers who are still working a 68 yo after their accounts were smashed during the Bush financial crisis.
No one is in the market "for the long-haul" with even the most conservative portfolio,at age 66. Woops! There goes early retirement ,or any other one.
Walmart's hiring though.
7
Right on, Paul. Thank you.
1
Market return is still 12% over the last year. Not a bad accomplishment for Trump.
For the last year the market has willfully ignored that a crazy person is in the White House and that a republican controlled Congress has neither the will or courage to control him. Explanations that a minuscule rise in wage gains or obscure computer trading strategies triggered the sell off ignore the elephant in the room. We have a dysfunctional government headed by an unstable President and a feckless legislature. There is also a serious criminal investigation of Trump and his closest allies. This country is in trouble and the smart money on Wall Street know it.
8
All it took to bring down the stock market was the photograph of Trump's enormous bald spot revealed by an errant gust of wind.
12
Yes but what does the Con Man in Chief have to say about the crash in progress? Obama or Hillary's fault again? Trump should have kept his slimy mouth shut last week instead of bragging about how well the market is doing under his regime. Oh and for those of you unfamiliar with his level of corruption BEFORE Trump was elected through the back door I advise you to watch The Confidence Man on Netflix. With the Mafia out of the way, is he the most corrupt person in America or does it just seem that way? But that's OK because he speaks his little mind right?
2
The Barack, steady as you go, dependable and extended, Boom of substance
followed, as might be expected,
by the Trump, "trust me - it's going to be Great", Tumble
6
This is all part of Trump's secret plan to MAGA.
By the way, could you use a bridge?
An alpine meadow building site...in Florida, perhaps?
Some Ovaltine?
4
And here is a sobering thought: At $1350 a share today, amazon still trades at about 230 times earnings. Just one year ago, AMZN traded at about $800 a share - still at a very, very rich P/E ratio.
Just in case you're wondering where your toes might touch the bottom in this here wading pool, in the event people starting trading on reality rather than feeding off their wildest dreams of greed and avarice.
I have two words for you, kids: 'Henry Blodget.' You can look it up if that doesn't ring any bells.
3
I got one word for you - "Plastics".
2
And, parts of the market didn't do this at all, and some parts did even worse. For people invested mainly in profitable, dividend-paying companies blue-chip that provide things people actually need or use, it was not such a steep drop. For people in some other parts of the market, it was probably like going over Niagara Falls in a barrel, a brisk, cold, deadly drop.
2
I hate to sound like THAT guy, but frankly all I do now is cash and a mixed real estate portfolio which includes rental units and commercial real estate. 12% of my net worth is in the markets, and that was always designated as "speculative". It's just a different ball game since '09 and I am not willing to go through that feeling again.
11
I think the balance of trade is beginning to move others to join those who are worried about inflation. No one wants to be the last person in a sell off. This may be a simple correction cough, or it could be the flu.
7
All cash and bonds here, excepting my long term holds which were bought long ago at much cheaper prices.
Behind all the hysteria, the only numbers that really count (excepting dividend stocks) is the price when you buy a share and then when you sell- in between is not that big a deal. If your investments are based on solid facts you can stay the course.
Real Estate is in a bubble as well. A good 20-30% in most real estate would be about right. The Median New Home price in the US December 2017 $335,400 Average $398,900. The Median Household income was $58,929.
8
Everyone knows that the markets are over-inflated. This market correction is part of the natural and normal cycle of a healthy marketplace.
7
Any tweets from our so called president?
Democrats should play the Republican game....call this a trump market readjustment! Say it enough times and the people will believe it.
NOTHING in our country is natural or normal anymore!
4
But of course, Trump nevertheless preferred to give his "fake news award" to the only economist out there who on election night already told us that within a year, markets would go down ...
9
The economy is doing well, and will continue to do so! Millennials, Generation X, and many baby boomers have yet to retire! Conclusion: With the Stock Market down ten percent from its high, this is an excellent buying opportunity! Buy! Buy! Buy!
9
Sorry, but I'm waiting for the half-price sale, which in the past has come along eventually and predictably.
1
The antidote to a falling market that Trump has hitched his wagon to is to give Kim Jung Un a 'bloody nose'. Should rally the base.
5
Just think, barely a week ago he was bragging about how he was making us all richer. But this, clearly, is all Obama’s fault.
26
Time to rescind the tax cut.
34
Attention DJT and Congress! Of course, they won't do it.
3
Current recipe for a more prolonged sell off: 1. Fold in budget busting tax bill which will balloon deficit by 1.5 trillion (Think of it as a national armory in which we handed out all the weapons and ammo and didn’t even bother getting an oath of allegiance from those taking our reserves)
2. Add in untested fed reserve chief. We had to remove the proven leader, chair Yellen because apparently we have to undo whatever the black president did in the prior administration. Wasn’t there as well more fed vacancies?
3. Key ingredient: add in emerging political possibly constitutional crisis. Warring political narratives and a general and growing distrust from both sides of the aisles about whether our current system of government can hold
4. Finally throw in handfuls of Trumps tweets with just a soupçon of Putin toadiness, and market makers will not feel as if there is or will be on the horizon a reassuring hand at the helm. Au contraire. We have 2008 Redux. 2008 we had a financial crisis which engendered a sharp political correction. 2018, we have a widening political crisis which is bleeding into our markets. Same end result.
35
And this time, since our Social Security funds were robbed and no repayment made in all the years since, there's not enough of the middle class left to bail the U.S. out again.
Guess it is up to our .1% to do the job now. Hope #45 has to do some of that bailing.
I beg to differ with your (no comments permitted) author who touted that about half the population had no stake in the stock market. That number has dropped precipitously as employer-funded 401Ks disappear. You know ... around the time CEOs began earning 300X what the average employee made All too many of us are approaching (or have achieved) an age where we (barely) scraped a lot more than the stated $100 together in hopes of retiring. This "correction" is less of a brush-off than people think! Thanks, Trump!
21
A large fraction of my retirement nest egg is tied up in equities. I have yet to fully recover from the crash of 08. This article is an insult to me. This is an excellent example of why Social Security should never be privatized.
17
You're right. When $ is stolen from Social Security, it is apparently 'never' repaid. We are given worthless IOUs going under the name of bonds in the 'full faith and trust of the U.S. government'.
Kiss the middle class goodbye entirely if we bail out banks engaging in non-bank behavior again, like they did late in GWB's tenure as prez.
Edward Abbey: "Growth for the sake of growth is the ideology of a cancer cell."
40
I for one have been waiting for the markets to fall. Why? Because now I can buy up stocks at a bargain.
Same reason I wait till after the holidays to buy what I need. Who in their right mind pays full price?
13
When markets crashed in 08-09, we were introduced to complicated derivatives and terms like "credit default swaps" that few people understood. Many of these arcane instruments led directly to the meltdown. Today, the geniuses on Wall Street are blaming ever more complicated instruments that have come into being. Can anyone explain to me what a VelocityShares Daily Inverse VIX Short-Term exchange-traded note is? Really? That is the newest bugaboo being blamed for the chaos. Is the fox running the henhouse again? You bet.
22
The week has another trading day left- Friday. Still no acknowledgement that all of that QE didn't create some 'addicts', especially among the top 10% .
If the wealthiest 10% own 84 % of the equities ,then they are the ones playing in the stock market kindergarten, and isn't this very much a game of 'let's see who will stay too long at the party' and who will be in cash given that valuations have gone ballistic?
Someone described the stock market as a kindergarten in the middle and of having a river at one end and a graveyard at the other; could be apt.
If $ 9 trillion in sub-prime mortgages helped lead to the financial crisis of 07-08, will $5 trillion in sub-prime auto loans and distressed student loans, as reported recently by an American academic, contribute to another market calamity in 2018?
Article was informative. Thanks, eh!
5
Hot air President, hot air Market.
Maybe good governance & rational policies, with reasonable bipartisan process will stabilize markets a bit.
Or maybe Trump should announce that corporations dislike higher wages & lower unemployment. Their big tax cuts - robbing the nation of revenue for crucial infrastructure investment- seems for naught.
And instead of squandering $30billion on a symbolic Wall (with short tern construction jobs)--why not put half into community colleges and half into energy grid ?
26
This is my first experience with a market drop in retirement. And it’s a relief to know that however far this drop may go, it won’t affect my Social Security or my Medicare.
Though it will certainly affect my IRA. Not the required amount I must take (that’s set by law, based on my age and the IRA total at the end of 2017).
So now I’m in the curious situation where the lower the market goes, the greater the % of my IRA I now am required to withdraw this year.
Suppose we end up in a bear market. Anyone who’s retired will be in a similar situation to mine. Forced to withdraw an amount based on an outdated, inflated figure.
Surely this is one reason NOT to tamper with Social Security or Medicare.
47
TheraP, the stock market has been running on pure sizzle, not fundamentals, since the Dow blew past 20,000, if not before. As for those tech and internet commerce stocks trading at hundreds of times earnings - or with no earnings at all - those are always bubbles waiting to pop the first time a strong wind blows.
If you did not begin taking profits and weighting to cash on hand when valuations began to look absurd - which has been for quite a while now - my condolences. Certainly by the time the Dow was over 26,000 and gobs of cash started pouring into stock index funds, it had to be obvious the johnny come lately amateurs had arrived and were chasing a train that had left the station a long time ago. You don't show up at a party when the champagne is gone, the ashtrays are full and the band is packing up and reasonably expect to get any action.
'Buy and hold' virtually forever and 'set it and forget it' may work when you're 20 and your timeline runs out 40 to 60 years or more; not so much when your investment horizon is 'I need it now and next year.'
Until the dust settles on this latest market kablooie, Cash Is King.
1
Better make sure you vote Democrat or you might just find your SS and Medicare drying up.
8
chambolle,
Shame on your for catigating people for following the best advice.
You are giving crazy advice! Hanging onto safe investments allows one to reinvest at lower amounts if stocks/bonds go down.
Cash is in case of need.
And you missed my point about a Social Security as a refuge in times of downturn.s
4
DJT goes to a prayer breakfast and takes God's name in vain hundreds of times. I was thinking that if there were a real God, he would not be happy and give a sign. Lo and behold! The stock market drops back to where it was when DJT was unexpectedly elected as POTUS. The Fates do not like to hear bragging. They can give and they can take away. When will mortals ever get the message. Hubris is for losers.
17
Do you think it was significant that the first drop was 666 points?
And that Jared Kushner owns 666 Fifth Avenue?
3
Right! There are signs that are so coincidental it's scarey. But it was scarey to begin with. Together -- wow!
Steve Mnuchin Threatens Stock Market Crash If Tax Reform Doesn’t Pass
October 18, 2017
* * *
“There is no question that the rally in the stock market has baked into it reasonably high expectations of us getting tax cuts and tax reform done,” Mnuchin said during a Politico Money podcast Wednesday. “To the extent we get the tax deal done, the stock market will go up higher. But there’s no question in my mind that if we don’t get it done, you’re going to see a reversal of a significant amount of these gains.”
http://fortune.com/2017/10/18/stock-market-tax-reform-steve-mnuchin/
19
One of the more remarkable comments from Trump's remarkable cabinet. He sounded like one of those clueless pundits on CNBC.
1
Who not to believe, huh? Wonder if there's still some gold in Fort Knox? Wasn't it Mnuchin who went to take a look at it?
the market was a bubble. i think the dow still has 3000 or 4000 to go (lower). other than removing regulations, I don't see that the underlying economy changed much as compared to election day 2016. you can't get something for nothing, and the tax cuts of course had the effect of increasing the deficit and borrowing and hence, higher interest rates. they give taxpayers lower taxes, and many will feel the effect of higher interest rates. hopefully they'll attribute the latter to this idiotic administration of con-men.
15
Nope, the .1% uber-wealthy get to keep permanent tax reductions. The middle class - and only part of it - only gets pennies on the dollar, decreasing to zero in about 5 years.
Another lovely mess to hand over to the Democrats, huh?
"Stocks Plunge"
and so do necklines. What does that tell us? Check our assets.
3
The debt is the big problem. Obama increased it by $ 10 Trillion to $ 20 Trillion during his tenure. That didn't leave much room for the current budget. The military is in desperate need of funds. It got it. But, to get it, so did Democrat programs.
The tax reform bill may add another $ 1.5 Trillion yo our debt over 10 years. That's a far cry from the $ 1+ trillion average per year debt increase we got during Obama.
1
We spend 7 times more on military than China and 10 times more than Russia. We're desperately in need of effective us of our money by the military. Obama inherited a cratering economic mess involving private debt balance sheets skyrocketing. That is the time when spending is needed. Does that mean its a free lunch? No. But we have a functioning economy and we can manage our debt if we keep the economy going. Sigh. I do not look forward to the next Democratic president inheriting the next Republican mess and people like you flogging her for it.
5
Obama started with a 1 trillion plus deficit in 2009 because of the recession. By the time he left, the deficit was approximately cut in half. Now with Trump tax cuts it’s back over 1 trillion in just one year.
2
One good thing may come of this major sell-off...his own will turn on DJT and show him the door in 2018
11
Where are you now America? You elected the Republicans back into the White House, having forgotten the debacle of the Bush years. They immediately borrowed 1.5 trillion dollars for no purpose, which you now owe. On top of that, you are now one year into the Trump presidency and the momentum of the Obama economy is winding down. You have a petulant child as president, not a leader. Not a good outlook.
45
We did a tax cut give away for the rich supposedly to help all of us because GROWTH and lo and behold, there's a second money grab from the rest of us non-rich, likely higher inflation because it, and then a third loss to the rest of us, the fed doing its job and likely curbing that inflation with higher interest rates, and then a fourth loss in the stock market figuring all that out and adjusting. So us suckers lose all that revenue in the future that we will need to pay for looming entitlement bills, we face higher inflation, higher borrowing costs and our 401k takes a hit. Thanks to all the traitors that work for a few rich corporations rather than us the people that elected you!
4
Waiting for the comments and wisdom from our fearless leader on how "beautiful" the stock market is.
6
The only real question is whether Trump's impending tweet will blame Obama, Pelosi, Schumer, or perhaps "anti-growth, anti-success liberals who hate America" for destroying the rally he single-handedly created.
9
Dow-Down Donald has been saying that he is personally responsible for how well the NYSE does.
So NOW can we impeach him?!
14
Sir John Templeton, a financial genius, said, "The four most expensive words in the English language are, 'This time it's different.'"
8
Ah, the "Dance of the Whirling Pundits With a Financial Stake In People Not Selling Their Stocks" . . .
The decade of the American economy living on the crack of cheap money and scared employees is OVER. Wages will climb, and people will have more money to spend. The Fed will extract all that extra money that they injected, and inflation will go up. Interest rates will rise, and old people will finally earn something on their CDs. Wall Street sociopaths will have to settle for smaller returns, and the resulting feeling less macho about themselves.
In other words, the economy will get back to something resembling normal.
One wild hair - with the Drumpf tax cut and now a half trillion in new spending by the government, we didn't just step on the gas of a hotrod that we FINALLY got going again (the economy) - the moronic politicians just hit the nitrous button.
The inflation time bomb of quantitative easing (aka printing worthless money) just got a whole lot more dangerous.
2
I am waiting for a Presidential correction.
21
Just think about the tax breaks for cash rich corporations and one can see the people have been fooled by trump and the GOP!
6
If our fate rests in something as erratic of our own making as the stock market then we all deserve to die. i hope the returning dinosaurs will forgive us for the mess we've made.
Guys.... all these comments about Our Fearless Leader are absurd. They just add fuel to the fire of his ego.
Stocks have been overvalued for years, primarily due to rock bottom interest rates. This correction is healthy.
If you are spooked by a 10% drop, you are overexposed to equities. And yes, then you should probably get out now, before you make the same mistake so many made in 2009-9 and sell at the bottom of the market, locking in your losses. We are in for a bumpy ride.
4
We (the members of this society) want a simple, perhaps single, number that tells us how healthy the system is. It's significance in inculcated in us by those people who tend to 'win' in that game.
2
Isn't it funny how everyone is wringing their hands, wondering what has happened? Having been through a couple of these in my lifetime, they always start with Republicans cutting taxes (which just happened. Remember last time when States were declaring bankruptcy and the US lost its credit rating?), Republicans increasing the debt (which just happened today), a new Fed chair (which happened last week), corruption (Wells Fargo, a bank too big to fail, got the smack down last week), and a decrease in regulations (which happened a few months ago when they repealed Dodd-Frank.) Of COURSE the market is going crazy. Just look at history!
10
I dont know of any politician in the past claiming credit for stock market. Just a few days ago Donald Trump echoed Senator McCain when he said the fundamentals of the economy are sound. These were the exact same words in 2008 just one day before the Lehman Brothers and Bear Sterns collapse.
5
I thought President Trump knew Wall Street. How low with the Trump Slump go? Unfortunately, that's the question.
4
As far as I'm concerned, the fault rests squarely on the shoulders of the our very smart, Wharton School of Finance educated POTUS. Wasn't he boasting a few days ago about the market highs that occurred on his watch? Now he has no choice but to "own" the market.
I think it's time for a big military parade down Pennsylvania Avenue to celebrate.
2
As it always happens when the stock market crashes, right there and then is when I get to find out that the economy had been doing well for quite a few years now. Otherwise I would have never known!
4
Question: is this correction in part indicative of a belief among investors that value will move away from corporate earnings and into cost of labor because of the recent tax reform?
1
I blame everybody. I have 2 annuities & 2 pensions. I hear the ads from banks offering great deals to get you into your new home. We are encouraging people with little money to take that big fat loan. I am now more than concerned about hacking. Fed up.
1
Markets go up rapidly because that's how testosterone works--we compete to get things that other people want. There was no reason to believe that stocks were worth so much more on January 31 than on December 1; but if other people wanted them, we 'reasoned,' they must be good.
Markets usually have a reason for rapid decline; something happens to make us believe we can't rely on exuberance. It might be an indication of true underlying weakness--collapsing banks for example, or weak sales. Or it might be new sources of uncertainty; like how the new tax code will affect the housing market, how not having a TPP will affect markets, etc.
These changes take a while to work through markets, but markets hate uncertainty.
3
Lots to consider here.
In some ways, this latest plunge is indeed a massive correction in an otherwise extremely overheated excessively exuberant stock market.
Personal debt levels are at record highs. Janet Yellin's departure didn't exactly help either.
A little inflation is necessary to cool down these near ten year buying sprees by corps and Americans. And investment in plain vanilla bonds and t bills is sorely needed now. Our decaying, third world infrastructure is counting on it.
6
Trump is not going to take "credit" for the fall, he will blame President Obama.
This "correction" had to happen because investors foolishly put money in stocks
afterTrump was elected. Now reality has set in, these investors will regret.
11
Well, if Trump has been so vociferous in taking credit for the economy doing well starting 2 days after he took office, shouldn't he be man enough to take responsibility for this collapse now? After all, it's been one year.
6
Economists and economic historians still have no widely agreed-upon explanation of the Great Depression of 1929--1941. They do not know, for example, whether the stock market crash beginning in October of 1929 had much connection with the banking crisis of 1931, which turned a serious downturn into a severe depression.
What we know now is that interest rates have been low for years, and people have adjusted to that. Low rates encourage people to take out or refinance mortgages, to buy expensive cars, to borrow money to finance college tuition. People are therefore carrying heavy loads of debt. How will they pay for that debt once interest rates rise? Probably, the rate of personal bankruptcies will rise. The higher rates will also cause businesses to cut back on hiring and keep wages low.
As many have observed, the huge tax cut and heavy spending on the military are sharply increasing public debt, which is already high. This puts pressure on the Fed to raise interest rates to moderate inflationary pressures, which fortunately are low.
If a recession does begin, the Fed will not be able to lower interest rates, since those rates are already very low.
13
I've been in the market for 30 years, and I'm way calmer now than I was when stocks were inexorably going up, week after week I suspect there is more pain to come, but the band-aid has been ripped off, finally.
34
Kind of - for some the band-aid's been pulled off; for others, their legs have been broken.
4
Reality has come to the stock market in the end of "easy money" from the artificially low interest rates that are no longer needed as the recovery has ended. But, will reality ever come to the Trump administration that views the current "correction" as a "mistake"? One can only surmise that an administration deporting hundreds of thoussnds when jobs are going unfilled and just added $1.5 trillion to the nation's debt (in tax relief for the rich) that will add to the upward pressure on interest rates is still unwilling or unable to face reality.
17
The last time this happened, one of my oldest friends emailed me "My 401K is now a 200.5K.
11
The state of Trump’s stock market? Sad!
21
NO!
You cannot have Janet Yellen back.
12
“This isn’t that out of whack with reality...."
Reality? What is that?
9
Most of the stock market in owned by the top 10% of Americans. The overwhelming majority do not own stocks or have only a pittance invested.
We can also say that the very wealthy have an inordinate influence in running the country . They are the oligarchy . We are a country run by the 10%, for the 10%. And they are not suffering, it’s the rest of us who are suffering.
29
Maybe most of the stock market is owned by the to 10%, but regular people like me, who have worked for more than 50 years and who will retire in a couple of years, are counting on the stock market to give us a decent old age.
10
Well, 10% of 320 million people is still a heck of a lot of people.
It also includes most Times writers and readers.
3
I can't understand so many people's inability to see the link between fear of inflation guiding stock purchasing decisions and fear of the "other" stoked by Trump himself and his minions. Fear creates aversion, irrational aversion. If you can't see linkages here, I can go on. Like markets moving up or down in terms of valuation, the valuation of worth in Trumpian terms is likewise a bilateral movement towards good (white) and bad (black). In other words, the racialized other constructed by Trump discourse is a type of analogue for the good or bad stock market. Of course, what is "bad" in one market (securities) is often "good" for others (bond) in terms of pricing valuation. Emphasizing or privileging one market--as Trump does at every turn in this analogy--closes off discussion around others, closing the mind to the relationships between markets, communities, people, and states. The consequences of such "blindness" or willful ignorance (choice which) about this how we think and act can be detrimental or freeing.
6
I suggest you listen to what the margin clerks are saying, not what Trump says. If they tell you that you have to put up $500 million in additional capital by the close of the day, nothing going on in Washington really matters. You have to sell or go bust.;
That said, can we call this “the Great Trump Crash” yet?
2
@Jonathan-Listening to margin clerks and not Trump is the privilege of a few, the privilege of those wealthy enough to dabble in margin borrowing to cover big bets. The difference in the spread is often relative to policies and action--try war, for example--emanating from the beltway. True, one might have to sell or go bust, but for the less privileged, the option to sell is often unavailable. And Washington has everything to say about maintaining their condition--or rather maintain the excesses and exploitations of capitalism.
2
Keeping this in perspective, quantitative easing has created a lot of extra cash that will still be looking for a home tomorrow and the day after that.
Cashing out of the market creates a different problem - where to put the cash and how to make a return ?
If you put the money in the bank, then they lend it to people who may not find it so easy to pay it back in future.
Remaining invested in the stocks of good robust and usually dividend paying companies for the long term is usually the best place to be for the long term.
The big benefit of this correction is that it may well create pressure on politicians to focus on managing real fundamental issues rather than behaving like a bunch of irresponsible jerk offs.
The Federal Reserve may also realise that many of the pre-conditions that generated the GFC in 2008 still exist and have not been properly addressed yet. Excessive debt, macro-economic imbalances in trade patterns, consolidation of manufacturing in China, loss of productive jobs in western economies, Wall Street and the selfish motives of the richest and least accountable people on the planet - all these problems still exist.
The financial markets should reflect maturely on the fact that the central banks need some headroom in their official cash rates in order to be able to respond to the next real economic crisis.
The media also needs to maintain a sense of rationality and perspective.
19
Well balanced and intelligent analysis. World central banks have to behave like the WHO, to prepare and stock vaccines against the next ( ebola or whatever) virus outbreak, not sit and wait for the outbreak and only then start developing means to face it. Let us give them some headroom, as you say.
This is why all the people who are polling satisfaction about the job our leaders are doing based on the economy need to re-think.
Markets go up and down, values and morals shouldn't.
Vote Dem in 2018
45
Now that Obama has caused the stock market to slump I assume he is moving on to cause some airplane crashes.
42
Welcome to the real world of the unreal world.
6
Let's call it Trump's Panic.
14
another 10-20% drop coming...
4
Why does this news make the NY Times front page? The gyrations of the stock market do not reflect to overall health of the economy and very few Americans have money invested in it.
3
Unfortunately, stock market has now a HUGE influence on the economy. We call it: Baby boomers retirement....and there are A LOT of Baby boomers.
15 years ago, it was not the case but now...Oh boy.
2
Overall health??? Discouraged workers, under employment, a fleecing of the 99% by the 1% GOP tax scam? People can’t afford to retire, people can’t afford to buy things, growth of 3% is assumed in the GOP tax scam but it will never reach that thus adding to the deficit. See, there is the fake economy that you hear about and then there is the real economy. Major collapse coming in two to three years. Thanks GOP!
2
Because when something like the stock market is used by a politician to brag about how great he is, it lands on the front page to rip the rug out from under his nonsensical claims of his greatness. That's why.
1
I'm tired of winning.
29
The alt-right was right. We've elected Hilary Clinton and the market has tanked!
Wait....... what was that?
Oh, never mind.
27
There is only way the American stock market goes over significant lengths of time — i.e. not days, weeks or months. And that would be UP.
Therefore, I very much hope the correction deepens or, better yet, that it turns into a bear market. That would be a golden opportunity to buy the stock of great American companies on sale.
7
The drop in the market is a coda for for Trumps grand symphony.
5
Watch the Fed start to print again. The Fed being beholden to Wall Street rather than main street. It is a bubble. It has to burst.
4
Gross inequity, dehumanization, alienation. And now the stock market tanks. Geeeez Louise. I need a drink.
15
Deficit, tax relief binge, base credit risk, volatility index traders crater, computers can't understand, wild trades, mysterious?
1
With the Trumpsters tax cut for the wealthy corporate business tycoons comes at a great burden to each of us because we will have to pay for this eventually all you people who loved what he did for tax cuts you will all lose massive your wealth which you richly deserve. All you clowns who voted for the clown car deserve losses in the health care and other benefits you all will get. Good luck to that.
5
Don't worry people, it's not as if a Republican Administration preaching trickle down economics and deregulation has ever caused a catastrophic financial meltdown before... oh yeah, there was that one. Yeah and that other one. And one time before...
19
Don't forget the other one's in Kansas, Oklahoma, and Wisconsin.
5
Sounds like it's time for Trump to turn against the stock market, maybe accuse it of treason, fire Mnuchin and start an DOJ investigation of how this could have happened. Or...maybe have the military parade on Wall St. just to show those computers who they're dealing with.
23
I'll take a 20% hit to retirement savings if it means getting rid of Trump sooner.
19
Meanwhile as markets fall, the great wheel of justice grinds slowly on, and though it grinds exceedingly slow, it's grinding Trump's so-called presidency exceedingly fine.
4
This market correction is just getting started. The stock market rose like a hot air balloon on the bloviations of Donald Trump; the gas-bag stock market is now leaking and coming back to earth. It always reverts to the mean once the follies are over.
Too much money, concentrated in way too-few hands, has for years swirled about the globe looking for investible opportunities. Trump insanely pumps more money at the same set of wealthy elites and does it with red ink. This tsunami of cash and expected tax-cut cash has goosed the market to irrational levels. The bill is now coming due in a federal budget that carries ruinous levels of red ink, with the market finally waking up and moaning "what was I thinking" as it all unwinds like a house of cards.
And this whole stock market rise and correction belongs 100% to Mr. Trump and GOP "cut my taxes" ideology.
12
What about the DACA.com stock? Hopefully that will go up as the greedy train rolls down...
3
Any other expectation other than the market (finally) going down, or at least not going up 1000 points a month is total folly. The stock market is now COMPETING with the bond market. This competition will go on as long as rates continue to go up. That is probably years, or as long as the economy improves.
1
During these events there seems to be a repetition of certain words to describe them; words and terms like "market correction," "investors weary of increase in interest rates," "bull markets," "bear markets," etc. The words and explanations (chosen by the corporate media) makes it sound as if it all makes sense, somehow.
Here's another interpretation: Wall Street is basically a scam. If you analyze ALL market crashes during the last 100 years, and dig deep into the data, you will see a pattern: in the aftermath of each crash, real assets (homes, farms, land, etc.) are transferred from the bottom 90% towards the top .01%.
2
Amazing how Republicans can't move beyond their failed playbook of tax cuts, ballooning deficits, lax regulations, wars and incompetence in governing because they don’t believe in government. This mix can’t end well - again.
8
trump re-deregulation of the banks, inflationary tax cut, 70% increase in the deficit from what it was in the last year of Obama...
What could go wrong?
5
In retrospect, it would have been more convenient for Trump if this correction had occurred about a year ago. That's a softball, right? Just blame Obama and regulations. If all else fails, Trump could always say illegal immigrants were somehow doing it. The message then would be, "the adults are in charge and we're going to turn it around."
Unfortunately, Trump immediately linked the stock market rise to the world's sheer exuberance that such a savvy businessMAN (am I right?) was taking over. The Trump administration then spent every waking moment bragging about how fast it was trying to destroy all things Obama. Trump himself has bragged about how the agencies holding back oppressed corporations have been brought to heel. The GOP tax plan, the undermining (although not the official repeal) of Obamacare, cracking down on the border... Trump pointed to all of it as the reason for the stock market rise.
I don't think presidents directly make markets or the sun rise and fall each day, but in terms of optics... what now? Can't blame Obama without relinquishing credit for all of the gains since Trump's inauguration (which would make Trump a liar, of course). I'm not sure this can be pinned on Clinton or Mueller either, but it's worth a shot. Maybe something involving lack of patriotism and the NFL? I guess, Trump could call the market data a "hoax" (like he did with jobs numbers during his campaign)... would his supporters buy that? Again? I guess we'll see.
6
The deficit in the first year of the Trump presidency is way up from what it was during the last year of the Obama presidency. It is now expected to top one trillion dollars next year up over 70% from what it was during the last year of President Obama's administration. Trump who has often proudly called himself the "king of debt" and his fellow hypocritical Republicans don't seem to mind increasing the debt now that they are in power as demonstrated by their irresponsible tax giveaway to the wealthy. Although many of the wealthy traders who benefit from the tax cut will not openly criticize it, they know that it is highly inflationary and that it will have disastrous consequences, which explains the recent sell-off.
The Obama economy was in auto-pilot for the first year of trump but after trump's irresponsible tax cut he now owns it. It will be interesting to see what excuses he comes up with when it crashes.
5
The economy is strong, don’t freak out. Stay invested. We’ll back to 25k before the snow melts, 30k by the end of the year. Keep putting money in your 401k and stop day trading. The sky is not falling.
1
Here's what's really happening. The big boys who are receiving the biggest part of the Trump tax cuts are selling big time, pocketing enormous profits - then running those profits offshore to the Caymans or Cook Islands. They'll pay no tax on any of this.
We've seen this before and will again unless the Congress eliminates the absurd and egregious right of the uber rich to offshore their billions.
11
Think of it this way. One or another, the country is going to have to pay a big price for getting rid of Trump. I'd rather it be by a huge selloff in the markets than by a nuclear war.
11
The market goes up, down, and up. What we forget in the middle of the all the great pie charts is that Hooverville lives. We have a housing crisis and children living in poverty. I have no sympathy for the investors losing money on this lottery.
4
Trump's "worries" today:
1. Finding a poll somewhere somehow where he had a better poll than Obama even if for a couple of minutes.
2. Planning his Draft Dodger's Parade for the Military.
Why doesnt he just up the pay for young soldiers and restore the protection against predatory lenders that he got rid of??
9
Trump and the GOP wanted to claim the victories of the past year. Let's see what they do with this "correction". Do they blame Obama, Clinton, the Democrats, undocumented immigrants, or admit that it's a correction that needs watching and if so, attributing blame is useless? My money's on blaming Obama because Trump and GOP can't handle responsibility unless it's someone else's.
27
It is ALL HOOVER's fault. Next week, trump will be singing the STORMY MONDAY BLUES.
"They called it stormy Monday, but Tuesday is as just as bad
Oh, they called it, they called it stormy Monday, but Tuesday, Tuesday is as just as bad
Oh, Wednesday is worst and Thursday oh so sad "
1
Oh, it will have to be Hillary and her emails somehow.
2
It's Trump's fault. The correction happened right after Powell was sworn in and Janet Yellen stepped down as chairman. Trump should have re-appointed Yellen and left well enough alone. Trump said the stock market run up was his. Now he can own the fall.
Truly, though, why is everyone surprised? Market watchers have been saying it is due for a correction. Here it is.
50
Thank you self-described stable genius, Donald Trump.
What a great businessman and dealmaker you are. Now that you've destabilized things, given away $1.5 trillion to the 1%, not enacted on sanctions passed overwhelmingly by Congress against Russia, attacked the FBI and DOJ, I wonder what else you can "accomplish."
Heckuva job, President Trump.
190
I suspect after all the Trump hoopla the market will correct and we will se a growth curve that continues what we have been seeing fot the last several years.
1
24% growth in the market in 2017. 8% in an average year. So you think 24% is the new normal? Respectfully I disagree. There is such a thing as irrational exuberance. The rich were coked up on the thought of all the public money coming their way, now that it's almost in their grasp, they realize that an extra couple of trillion in debt spending probably will raise interest rates. Trump isn't to blame for the irrational behaviour of the market (as much as I'd like to add that to his list) but he took credit for it so he'll own the inevitable decline. Still a correction is a good thing, it prevents a harder collapse down the line.
39
"Irrational exuberance." Perfect phrase, Arthur.
2
Trump will never own anything that happens on his watch. He will just blame someone, anyone, else.
And that couple of trillion in debt that is causing the rising interest rates is completely due to Trump and the GOP tax boondoggle.
2
I'm in my 30s. I've simply accepted that I'm never going to retire. I've got my meager savings split between a savings account earning a whopping 1% interest and a conservative mutual fund. I've lost all the interest I've earned since opening up, but still have most of my principle investment so far. But I realized the stress of worrying about the future was probably taking years off my life and making the present unbearable. The rampant rise of the market had to end sometime.
87
Risk is not maintaining your purchasing power, net of inflation and taxes, over the next 30 or more years. Dollar cost averaging (monthly contributions) into a volatile market is your friend. You automatically buy more shares when they are on sale and fewer shares when they are expensive. Thirty years ago, a first class stamp cost 25 cents. Today it is 50 cents. Divide what you are earning into 72. At 1%, it will take you 72 years to double your money. (Rule of 72). If yo are in a moderate fund, say 8% average annual returns, your money will double every 9 years. You will be able to buy stamps in your retirement. If you've accepted that you are never going to retire, it's certainly reflected in your retirement strategy. Losing purchasing power net of inflation and taxes should make you more stressed than short term market volatility. Get smart and get a Roth IRA in addition to any work related retirement plan.
14
Good advice, Johnny, although wcdessertgirl did indicate a 'meager' principal.
84% of stocks are owned by the richest 10%.
Most Americans don't participate in the stock market to any great degree because of....Grand Old Poverty.
15
I'm in my 40s and I realized the same thing long ago. Boomers are taking it all with them, and my share too.
2
If you're worried about the drop in the stock market I have a quick, easy trick for you. Instead of looking at the trend over the day, week or even month, pull it out to a year or even longer. Perspective people.
11
"pull it out to a year or even longer."....While normally wise advise, will Trump still be President a year from now? I understand the markets hate uncertainty, so I would be very careful.
5
Yeah? Did you offer the same assurances in Oct. 2008?
2
And bond yields rise. :/
1
Let's all just settle down. The market has quadrupled since its 2009 low. A 3.5% correction is healthy, not catastrophic, especially when it's a normal response to rate hikes. Since when are people in this country so scared and entitled? Oh, that's right, since forever.
23
Since Trump made them scared That's when
5
response to rate hikes. SERIOUSLY?
the market was doing OK in the early 80's when banks were paying 13%. now market rate accounts in B&M banks are still paying .50. After a year, one could get a latte and burger with no cheese.
1
Here comes the bear market. Because investors who contribute no real value to society (other than capital) don’t like the fact that workers wages are rising and the economy is improving so much that the Fed can bring interest rates into a far more realistic range than they’ve been in a decade at least. It really is pretty pathetic that in this day & age, improvement in the economy translates into the market going down. But that’s the new era we live in. Broken government, a reality star President, and markets that plunge when the lower caste improves its lot.
103
Because this idea that when interest rates rise stocks go down is brand new, right?
6
I see, everything going pretty swimmingly but the specter of interest rates rising is sufficient to destroy many lives? Really?
This is the latest financial industry scam harming millions of people.
I wonder how much the heads of big Wall St. Banks did not lose or made out with new big with bucks from the engineered stupendous volatility they engendered?
20
If they lost $ I hope they still have enough left to dig themselves out this time around.
They made sure we wouldn't be able to so lets not even try. #45 try to push it onto our plate, impeach him!
Trump is doing to the stock market and the economy exactly what he did with his casinos. Arrange it so he gets as much money out of it as he can (in this case the the tax cut for him and his family) in a way that sooner or later tanks the whole operation. He walks away clean and rich and everyone else suffers. This is what he genuinely considers "winning."
178
Trump has nothing to with the crashing stock market. Just as GWB had nothing to do with the crash of 2008. It's a periodic cycle and has happened hundreds of times.
But... But... Trump proclaimed the rising stock market was due to his genius policies!
And yes the crash of 2008 was entirely due to W's deregulation and nonsensical tax cuts. the stock market was lower after 8 years of W, and Trump is following the same failed path.
5
Congress, want to ensure further market losses? Refuse to make a deal to prop up the United States of America and its full faith and credit. Along with the clown in the Oval Office and his threats and parade ambitions, and promoting hatred and danger, confidence will erode until our government remembers it serves us, not its donors. And those donors are now losing too!
39
I guess the fact that the US elected a President who indicated he would like to negotiate on US Debt during the election and 2 days ago said he wanted the government to "Shut Down" again to teach Democrats a lesson, is getting one. Full faith and credit of the United States doesn't mean much any longer and the world is reacting.
Oh, and BTW we're about to hit the debt ceiling, too. Why should anyone be concerned?
33
When will Americans learn that Republicans always destroy the economy?
177
Stock market goes up, Trump: "Ain't I the greatest?"
Stock market goes down, Trump: "It's Obama's fault."
So much for "The Buck Stops Here"!
30
MattNG - just as Obama blamed everything on his predecessor GWB during the entire 8 years of the Obama administration. When will the Democrats ever take some of the blame for their own irresponsible dictating?
Calm down, every one, calm down. The American economy is better than ever....The market is over-valued...Calm down...
13
Blue skies,
Smiling at me,
Nothing but blue skies,
Do I see....
You certainly haven't had to be a savvy stock trader or investor to see how much blue sky has been in the market for some time now. I don't know if this is the culling that any pragmatic person has seen coming for a while now but if it's not, it is surely a precursor.
Record high after record high after record high in a remarkably and suspiciously short period of time. All the while, the credibility, stability and reliability of the governmental infrastructure that makes these soaring highs possible has never looked less sturdy.
Most of us regular folks would be better off in the casino run by Scorcese, DeNiro and Pesci. It's less crooked than the one run by the Smartest Guys in the Room.
9
trump talking about how great he is, claiming high Dow numbers has the distinction on his watch a 2,000 point drop in record time, only 5 day! Congrats to the Chief.
16
It killed me yesterday when I read about Republican bigwigs proclaiming "the fundamentals of the economy are strong." Aren't those the exact words McCain used when the market was cratering in 2008? Those guys should get some new material.
26
Stock market = economy?
Since when?
I will humbly give some advice to Mr. Trump, the markets are a leading not lagging indicator...the straight rise in the markets for the last 6 months were you're tax cuts, your employment number and other good news.
The drop is portending interest rate hikes, rise in bond prices and the cost of borrowing increasing...i would have thought such a distinguished businessman as our President would have known this before making a fool of himself touting the stock market as example of his economic prowess.
31
Get ready for the Trump tweet--I predict Obama or Hillary will be blamed for this downturn.
20
As noted in my book, "Investing in Four Hours", there have been 24 20% stock market drops in the past 70 years or so. If you invest in risky assets, corrections are to be expected. Yawn.
Robert Bradley
5
Hi Mr. Bradley, It is a pleasure reading your comments and your books and commentaries are always outstanding.
Those whom drank wildly during the prospect of tax cuts and deregulation are now sobering up and asking "I think I drank too much. What now?"
10
Respectfully, it's "Those who drank wildly" NOT "Those whom drank wildly", unless it was the autocorrect WHOM did it
Sir Isaac Newton and Blood, Sweat, and Tears knew: What goes up must come down.
Good time to buy, though. Cooler heads stay in, rain or shine.
6
Big correction, all the way back to where the Dow was last November.
11
In the market for over 30 years, all one can say is that the market goes up, and the market comes down. Simple as that. Trying to time the market is suicide. Pick a company you like, see that it's earning some money, look at some of its products, good p/e ratio, has a 3-5% dividend and buy some, and hang on to it.
4
People say "Don't time the market"... and yet in my innocence, I sold off big time right before the last 2 crashes because the market seemed overheated to me. I hear this 'you can't time the market' comment a lot, but I do think you can harvest gains before things get too 'hot'.
1
The invisible hand of the market thinks Trump is toast!
11
Wallstreet is a giant casino and it should be treated as such.
If you can afford to lose the money you put into it, then, by all means, go buy your stocks.
However, if you are like most people who can't afford to lose what you put into it, it will be better for you to try to find a safer investment even if the solid returns aren't there.
BTW, the stock market has nothing to do with the overall economy. Stocks that are bought and sold usually do not help the bottom line of the company you are buying into unless it is an IPO. It is a giant Ponzi scheme that the already wealthy excel at because they can afford the market ups and downs.
Meanwhile, those who were counting on their 401k's to retire on soon have just lost a large chunk of their nest egg and now they need to decide whether or not to continue working(if it is an option) or to get out now with what funds are left so as to protect what they already have or to try to ride it out knowing it could be a long time before their portfolio is back to its prior levels.
As long as you remember that the stock market always has ups and downs you can plan accordingly. This last few months of the excessive stock market rise was an anomaly, I hope most people realize that. The current downturn was not and is not unexpected.
10
This is the market reacting to the extremely large increase in the deficit and the instability that may bring.
The Treasury yield curve has risen considerably in the last month, especially compared to how stable its been for the last 8 years, reflecting the growing instability of the US Government.
A positive outcome may rely on the government returning to stable leadership after the elections in 2018 and 2020.
6
Jan. 23, 2018 (two weeks ago)
"You're seeing what's happening with the stock market. People are appreciating what we're doing," Trump said during an announcement of tariffs on imported solar products and washing machines.
Yes, Donald, we can all see what's happening.
Your latest bankruptcy plan is starting to take shape after just 12 months in office.
231
Seems pretty obvious the Republican "tax" plan, a giant gift of future debt to the rich, coupled with a huge deficit spending bill, all but guarantees massive income inequality, sure to implode the US economy, traditionally dependent of broad consumer activity. The GOP is taking us down the Kansas road to perdition.
62
Hello, DJT! You're the greatest. It's taken a year, but by golly, you are going to undo everything that Obama fellow did to stabilize the economy and protect us schmucks from the deserving predators who just can't get enough of our blood to suck. We know we don't deserve to be anything but the dirt beneath your golden feet and Melania's stiletto, so thanks for putting us in our place! Keep on bein' fact-free ...
With love,
Grateful Trump Voter 4ever
I Love God and Guns
266
As Mr. Trump said, this is his stock market. As he said, this is what your IRA will look like in his stock market. The last market meltdown was Republican. This one is, too. Meltdowns, market bubbles, and volatility are a Republican thing.
The long steady stock market run-up belonged to President Obama. The rescue of the economy, hindered by Republican obstruction, was Obama's. The solid economy is Obama's. Sane, competent, and responsible government are a Democratic thing.
575
You know, you're right! But, Pelosi's got to go.
3
I admired and appreciated, if not always agreed with, President Obama. I will never either admire or appreciate Cadet Bone Spurs, and I will never agree with him.
But have you looked at the graph please? The market lost 2/3rds of its nominal value in 2008, in Obama's first year in office. It then dropped 16% in 2010, and 19.4% in 2011, as well as 12.4% in 2015.
One can say that overall, the market increased about 1/3rd in value from the time President Obama took office until he left office, during which we cannot call the price movement a "steady stock market run-up." But who cares? Presidents do not have much to do with the stock market long term. What is true is that, to the extent he was allowed, Obama was good for the economy, if only because he didn't do anything that overtly hurt the economy.
The measure of Trump's effect on the stock market, to the extent he has any effect at all, will be measured from the approximate
S&P benchmark he came in on. But again, Trump will have as much or little effect on the stock market as Obama, or any other president, had.
The issue will be how Trump does or does not help or harm the overall economy. The market is mostly about how much surplus cash is floating around which has to be diversified from productive assets, and what the quant and other technical traders are up to, at this point.
1
I concur, but unfortunately the DNC has no idea of how to use this to their advantage.
Nancy Pelosi can hold the floor for 24 hours, but if Democrats can't get their platform straight, then all is naught. Republicans know how to get their message through, even if it to the detriment of those who believe in it.
2
It's not like there weren't warnings by tons of economists but the Republican congress chose to ignore that advice and listen to individual specific corporations and the Koch brothers instead. Why should anyone be surprised?
63
Well heck, they don't like to listen to elitest experts.
1
I have absolutely no idea how this will affect my 457 account invested in Cash short term investment funds. No idea at all.
6
What's your point? How long do you think your cash will last when inflation kicks in? Better spend it now, before your finite dollars don't buy what you need.
1
S&P is now down to the level it was 11/15/18 - a little less than 3 months ago? Another 10% drop would take us to levels from 2/15/2017. a year or so ago. There will be down years. That's why you buy bonds and stocks that pay dividends. It's not a casino, and 20%+ yearly returns are not realistic. Your 50% return over the last 2 years was not "real" unless you cashed out. And if you do, you're off the table for future gains. Have a year's salary in cash, more if you're about to retire. and just chill out folks. This is normal.
101
I wouldn't call this normal, except in the cyclical nature of stocks. Normal does not include unrealistic gains or losses. Normal is not a 20% yearly return nor a 20% drop (extended or not) in days or months. What is normal is a return to the "norm" as determined by average stock valuations vis-a-vis the economic environment in which they rationally are tied. But valuation of stocks depends on irrationality, else the market would never drop, never change. And rationality in stock picking is itself a best "guess" as to valuation. The acceptance of the up and down movement of stocks is a normative belief in irrationality in some sense. A belief in valuing something that in real terms is a phantom, a moving target, an unreal material entity--a reification.
2
I disagree. It is a casino. It's like being tethered to the tables in Las Vegas 24/7/365, when all you want to do is step away, kick back and take in a fun show.
Oh -- and the 'house' always wins. Always.
1
Have a year's salary in cash??
hmmmh? Maybe Krugman was right. Just a few months off...
17
Soooooo much winning.
I for one am exhausted by it.
32
Glad to be invested for the long haul. Here's hoping it outlasts Trump's long con. I am not loosing a bit of sleep over the market, but Trump's seditious ice flows are giving me the Willies.
2
Song for today:
"It's a Barnum and Bailey world
Just as phony as it can be
But it wouldn't be make-believe
If you believed in me.
Say, it's only a paper moon
Sailing over a cardboard sea
But it wouldn't be make-believe
If you believed in me."
11
Call it market correction, call it inflation fears, call it profit taking, call it anything you like, I call it panic selling and uncertain future for the stock market.
16
The best time to buy is when other people panic.
The best time to sell is when other people are going into debt to buy more.
Only one thing is certain: stocks will rise and fall.
Dollar cost averaging and rebalancing will win every time.
5
You are right J from Washington State. This is the best time to buy. A lot of stocks from the largest corporations with good dividends are currently under priced and will make a good buy right now for long term hold. Of course buying highly risky stocks of companies that recently sprung up will not be a good buy.
2
I'm sure fox news will cover this story in depth... After all, they ran story after story about the market all of last year. Why stop now?
37
They are. Hannity is blaming Obama. Gee didn't see that coming.
3
It is not only the democrats who are not clapping at Trump. Clearly Wall Street is also acting in a treasonous way. Anyone who sold stocks today should be sent to Gitmo (after they have been waterboarded into admitting HRC put them up to it)
51
How about all those Carrier Air Conditioner Factory jobs?
64
It was simply a ‘performance’ for Trump’s image. It was never about the Carrier employees.
1
another 'Black Friday' for tomorrow ?
13
What are you going to do now Mr. Trump? "Have a military parade, showing what a great leader I am!"
63
Stocks are on sale everyone, get them while they're hot.
9
You always double down on eleven! Always!
3
not yet...another 20% to go...
1
Not just yet, Andy. We got some dandies to cut loose first. Who bought the Orange koolaides?
So, in the context of the State of the Union address, does this make the stock market “treasonous” ?
70
Winning again. Go Donald go!
9
This correction may be the best news for Democrats in the upcoming November election. With drops of this magnitude investors get real skittish, and reduce their risk. In other words, they "cut their losses".
Then start pointing fingers, and guess where? Yep, the loud mouth who liked to brag about how his administration was responsible for it's rise.
117
The market assumes some sanity in our politicians, and our politicians not giving everything away to the .1%.
If investors (banks primarily) expect another bailout, too bad. We've already been robbed too much for that to happen again! No more robbing 'OUR' $ Social Security and Medicare this time around. The middle class has already been decimated - let the .1% cure the problem this time.
Such short memories people have!
22
Let’s hope that the Trump Bump which turned into the Trump Dump doesn’t also slide into the Trump Slump. (And if it does, do you think he will take credit for it, too?)
28
Fear has returned to the markets. But, stocks are not ridiculously priced. Historically, they have been both cheaper and more expensive at these levels. But, we don't have a financial crisis on our hands like we did in 2008. And stocks are not more expensive than they were in 2000. We could go up or down from here in the near term, but I would point out that the 10-year treasury note closed at 2.86%. That's not too good. Stocks at these price levels should return better than 2.86% over 10 years. But, in the near term, prices could go lower. If you have some money put away for the long term, it should probably stay in stocks.
10
I wouldn't buy stocks at these prices. It seems as though any bad news is going to send the market lower. If you're in a 401(k), fine. Keep adding incrementally at "discounted" prices. But it's too early to "back the truck up" and gorge on what may be just the shallow end of the selloff. Think of an airplane that ran out of gas at 33,000 feet. It can't just park on a cloud.
8
Park on a cloud? That's hilarious
"could go lower"?...will go lower...
1
I'm putting all my money into Tulip Futures!
26
I am waiting for Trump to twist the truth into a lie. I can't tell if he is lying or not because he lies so often.
9
Easy way to tell: is he speaking? There's your answer.
5
My wife thinks I'm a genius. I sold all my equities on Jan 10th. I saw it coming. It all started when the t-bills ticked up, but the trigger was Janet Yellen's departure.
185
My husband thought I was a genius when I got out of equities at the end of 2007.
I didn't get back in, I couldn't go through that again. Not so genius on my part, but I slept well, which was worth more to me. We were too close to retirement to go in for another 'long haul', I thought.
I have no regrets.
18
Good for you. I hope you pick the right moment to get back in, market timing being famously unsuccessful as a long-term strategy.
5
Unless you sold a measly amount of stock, let's see what she thinks about your intellectual faculties once the tax bill arrives from Uncle Sam next year.
That is, assuming you were invested in stock that appreciated before you sold them.
1
Mr. Obama's stock market was mostly slow and steady wins the race. Trump is the rabbit that rushes madly ahead without regard to spending. Who won the race? I think we are "fixin" to find out.
21
Weren't we told just to have faith, that Trump's Tax thingy would make America great again by boosting the economy and especially by cutting corporate taxes, building a wall, and imposing tarrifs on imported washing machines? And now what? Oops?
16
Is the stable genius going to finally realise that it was unwise to brag about something going up when it could go down very easy. Perhaps the injustice of the tax cuts has caused this as it clearly constitutes a fundamental. People have forgotten that deregulation was the forerunner to the GFC only 8 years. It took 8 years to recover this far and as soon as the economist in-charge comes in and deregulates willy-nilly. I think with things plummeting right now it would be a great idea to have an expensive parade just to keep the military busy and lift everybodys spirits. Kim Jong un had one yesterday with hundreds of thousands in dire poverty. But he is a strongman leader with an eccentric hairdo and a family dynasty. Just the type of leader Trump admires. Yes a big parade would be just the thing to steady the market.
13
This may be something new. It is possible that a Trump effect is kicking in to magnify the natural correction expected after a 'quantitative easing' driven long bull run. Having an incompetent president who is beholden to hostile foreign interests, in addition to being a habitual liar and malignant narcissist, acts as a depressing influence on the nation's psyche, dramatically reducing the tolerance for financial risk.
37
Yep, we're in uncharted territory!
4
basically you are saying that people are realizing that there's no one at the wheel.....
This is why you don't have a massive tax cut at full employment.
233
Agreed. $1.5 trillion borrowed to finance tax cuts for corporations already making records profits + a new budget busting 2-year spending plan is a perfect recipe for higher interest rates to head off runaway inflation. I'm only surprised the consequences have manifested in such a short time.
4
I will be interested in what happens Friday. Also what happens in Asia, and in Europe.
12
If this continues for a couple more weeks I might go ahead and buy in.
6
What could have started this sell off of stocks?! What a great mystery?! Is it fear of inflation?! The Bank of England raising rates?! The Philadelphia Eagles finally winning the Super Bowl?!
Davos meeting - the week of January 22, 2018
Stock sell off begins - the Monday after (January 29, 2018) and continues through this week (see the graph above).
Mere coincidence? All of the wealthy fat cats and world Oligarchs meet at Davos and dine and dance and make merry. As soon as the US Stock Market opens the following Monday, they start cashing out. Much more was passed around the table than shrimp and coffee.
It's what they do. Blow the market up to the stratosphere, then decide when it is time to pull their money out fast and early, leaving everyone else to hold the check as they run for the restaurant door. 1987. 2001. 2008. 2018. Like clockwork. About every 8-10 years.
The trick is to be one of the informed, to get the word early when the word is passed to "sell now and get out." But like George Carlin said - "it's a great big club, and you ain't in it."
49
The stock market is for gamblers. If you like to gamble trade stocks. Unfortunately too many people think it's a form of investing.
7
It actually you who does not know what investing is. For example, A $5000 investment in AAPL in 1996 is worth several hundred thousand today even with the sell off. There are many more stories like that.
3
Faulty logic. For every AAPL there are dozens of companies that went bust. The stock market is risky, a fact lost on millions who expected the casino to rise forever.
1
This is NOT the big correction. Technically, yes, the drop may qualify.
What is missing from most news reports, however, is a little history -- and I do mean a LITTLE history. When did stocks last have their current prices? Taking the S&P500 as the example, stock prices were absurdly high and the run up last year was "irrational exuberance".
That stock bubble then super-inflated even more dramatically in for a couple of weeks in January.
All that has happened in the past week is the undoing of the ridiculously huge January jump.
The "big drop" only put the market back to values from two months ago.
The question shouldn't be "Why such a big drop now?". It should be "Why did investors completely lose their minds for a coupe of weeks in January 2018?"
Blip up. Blip down. Now we are back to the extreme overvaluation that was worrying many in November.
This isn't the Big One (yet).
23
The REAL question should be why did the voters completely lose their minds and elect an ignorant and morally degenerate man president in 2017?
Until the "correction" goes to 20%, it wont stop. Not shocked, after what we saw in the 2000's. That "dont worry" essay by nytimes Neil Irwin the other day was poppycock.
7
You could see this one coming after last Tuesday. It usually goes down a lot, then a lot of folks think they can make money so they buy when its low, then boom, the floor drops again. Reminds me of the Twilight Zone Tower of Terror.
Whether this will be the end of it or not, we will likely know by tomorrow. If it keeps going down, then we will know we are really in for it. If it does, be sure to buckle up, because it will be a wild roller-coaster ride.
5
I think the thing to understand is that while pundits are trying to calm investors by saying that the economy is strong, therefore market dips are just normal noise, keep in mind that most economic indicators are lagging. That is to say, we won't know we're in any kind of downturn until we're several months into it. To that extent, the market can sometimes be predictive, if only as a collective view on the state of the world.
7
It took to early 2008, for the US government to admit that the Great Recession started in late 2006, when Bear Stearns started having issues with the housing bubble, and its eventual failure in early 2008. Then came AIG and then came the October crash. Eerie that McCain was speaking when the DIJA dropped 777 point and saying the fundamentals of the economy are strong. On Monday, while Trump was speaking, CNN showed a similar split screen, while the DIJa dropped over 11points. Later, a White House spokesperson echoed nearly the same line as McCain 10 years ago.
The excuse here rising interest rates does not hold water. The Fed has been raising them fro the past two years. Inflation? People are still waiting for the large raises, that have yet to materialize, if ever, with the tax cuts.
Unemployment at 4.1% is a misnomer, as it is probably double that, when you consider, less workers in the workforce, and many people hold low paying jobs. More so, than before the Great Recession.
And, funny, up until 6 months ago, it was reported the US was the strongest economy, China was faltering, and the rest of the world eking by. Now, we get reports the world economy is got.
So, make your own conclusions, but there is incorrect information floating around. We are seeing a similar pattern, as we did in late 2008.
In the last two weeks almost all gains, for the last three months, have been wiped out. 26660 down to 23860 or 11.5%.
2
And if in five months or so we are not turning down might this be yet another Wall St scam? In this case through engineered exponential volatility?
1
Common sense would say - don't put money in the stock market that you can't afford to lose. However, considering that for years now the average guy hasn't been able to earn more than 0.1% to 1% in traditional safe investments like savings accounts, CD's. etc., many people have been willing to take the risk, otherwise they can't get ahead. Yeah, I remember the days of inflation when you could earn 10% or more in a savings account, and maybe it is too high, but there were many, many years when people could earn approximately 5% at a bank and the stock market wasn't crashing either. It seems that the wealthy want the interest rates to stay artificially low so they can keep the stock market artificially high - many can afford the risk since their assets are diversified.
23
So, within a week, the two largest point drops of the DIJA in history. Based on where it stands right now, all gains from October, 2017 to now, were wiped out.
The reason given? The potential to raise interest rates. Even though the Fed has been raising them for the past two years or so. The real reason? Sell off, drop the market, drive people out, come in and grab the bargains.
The greed gravy train continues.
31
Largest point drops are meaningless. Largest Percentage drops are far more important.
2
Fine, the markets have tanked over 11% in the past two weeks. Now point drops are no longer meaningless.
2
Welcome to the Trump Slump !
The perfect time for a $1.5 trillion handout to rich people....and a recession for everybody else.
The Art of Sinking Ships....by Donald Trump
604
Hopefully those rich people will spend spend spend and buy all sorts of goodies. At least manufacturing and sales would be ok.
1
"The perfect time for a $1.5 trillion handout to rich people....and a recession for everybody else."
The perfect time for the rich to take 10-20% hit and not really feel any pain while the wages of the average workers are finally starting to grow. Win-win all around.
So England is the first to move. I would have guessed Switzerland but the list of options is short. I expect Europe and Asia will follow as the market find its new bottom. The US is once again first to be last. There won't be a major policy announcement coming from the Federal Reserve during the Yellen-Powell transition. I'm guessing both governments and markets had this planned. You'd be silly not to see it coming. Someone is going to get rich while the US is standing on their heels.
Let's just hope we don't pop a bubble while we're at it.
8
Still money to be made in the stock market for the little guy.
if
you have a 150 year lifespan
107
It's interesting to read the stories of people who invested in companies after the 1929 crash and the depression. Some of them made huge amounts of money when other people panicked and took of their clothes these people picked them up and opened clothing stores.
4
I'm a little guy, I've done fine in the market.
7
Thanks. I laughed out loud.
1
"The stock market is selling off. Again."
Yes. And for every one of those sales, someone is on the other side of the trade buying while stocks are on sale because people and/or algorithms are panicking.
11
My guess: 'that someone' on the other side are corporations buying their own stocks, to inject confidence among investors. After all, what else can they do with all the money they're saving now after their taxes got cut in half?
14
I thought similarly. Who are the new owners of stock -- Russia?
So wonderful the newly born Christian President was praying today about “The Creator” even reciting verses, and talking about Jesus.
Perhaps the stock market was one of his prayers not written into his speech.
Surely his creator will come to his rescue if he is to prove himself and to everyone else about believing.
13
I don't think Jesus would think kindly about Trump calling his daughter Ivanka "hot," implying an incestuous relationship or at least incestuous desires. His religiosity is a fraud, but he finds a place with the fraudulent "seed faith" preachers such as the Copelands.
7
So what does our businessman-in-chief have to say about this Wall Street panic? Is he in conference with Gordon Gekko (Wall Street, 1987) who sneered “$475,000?...it’s just a day’s pay.”?
Or will his next tweet blame it on Obama?
81
Unlike 2008, there are many more folks getting ready for retirement and can't wait for the market to go back up again. What will be the impact as millions of folks move money in their 401k's out of equities and into more conservative investments?
56
For me it's ok because every place I wanted to retire at is either gone (Santa Rosa, Ojai, Puerto Rico), about to go underwater (FL), or has immediate nuclear threats (HI). With the no SALT deduction and having Prop 13 in CA, we can't afford to move to a high property tax state.
2
Um, this happened to those about to retire in 2008, millions of them, also.
1
This is clearly a result of the Obama Administration.... some how... some way?
17
So much winning.
183
Last Thursday marks the end of the O recovery. We are now into trump's market.
170
Why is everybody worried? Trump will certainly make the market go back up 2800 points just as he did the last time.
9
There is a lot of evidence to support the case that we are at the start of a major market downturn. Much of the recent prosperity rests, not on productivity improvements, but upon the accummulation of debt and the unrealized gains from excessive asset speculation.
Lets start with the evidence of asset speculation. Whether it is the bitcoin bubble or the record heights of the Case Shiller housing index. Or for stocks, look at the CAPE ratio,which looks at stock price to the last 10 years earnings, hitting levels last seen during the dotcom bubble or prior to the 1920's stock market crash.
Next let's look at the accumulation of debt as the source for spending that funded the recent "healthy" economic growth. Consumer debt levels hit records. College debt levels hit records. Car loans are now being made for an average of over 6 and a half years...a record. US Mortgage debt is at record levels. And that doesn't even look at US Government spending and debt or corporate spending and debt.
241
I cashed in my profits today, moving them over to a bond fund. But what can small fry do? I can be content that I made good money from this economy of phantoms and diversified the rest of the portfolio enough to ride out anything short of Great Depression 2.0. Then we'll all be bums together, except there are no more pies to steal from windowsills, alas.
1
Or the Repubs increasing the debt by $1.3 trillion to pay back their donor classes in a tax cut while most people get a mere $1.50/week in "tax relief" instead of thousands.
10
bitcoin is up
2
Looking at the trading patterns on CNBC, it seems to me like this might be the start of selling by retail investors.
After watching Monday and Tuesday, some 401K holders probably traded out of the S&P fund on Wednesday night. They can get the NAV of Tuesday's close, and if they are up substantially since 2013 or something like that they might just take it.
If 401K holders trade out on Wednesday night, Vanguard and Blackrock have to sell the S&P stocks on Thursday. You would expect steady sell all day, equally distributed over the S&P 500 stocks, and that's exactly what happened.
Will others join them tonight? The mutual funds don't like to show their inflows and outflows, but it doesn't look good.
Yeah, never sell, hold the broad index fund for 40 years until you retire. That's what everybody says. But if you're up 150%, and you have $200K in your 401K, you are likely to say the heck with this, I've got a nice profit, I'm out. That is the reality of human psychology.
109
I'm watching Cramer now. He continues to insist that it's all hedge funds who were short the VIX who have to sell S&P stocks and calls.
If the selling continues into next week, then you can be pretty sure it's not that. The selling has spread, and the general mood is to head for the exit while you can.
1
I think that is the psychological reality for some people--to take profits now and avoid any further decline--but that doesn't mean that staying in the market isn't the most profitable thing you can do over the long run. Especially if you can keep saving to your account. And especially if you have a diversified portfolio and have been dutifully rebalancing.
3
Markets go up because of Obama.
Markets go down because of Trump.
371
We always see eye to eye, R.R.
3
Socrates. "a man of great insight, integrity, self-mastery, and argumentative skill."
2
Socrates, "a man of great insight, integrity, self-mastery, and argumentative skill."
i heard an expert on cable news say, now is not the time to panic. so that's reassuring. meanwhile, the white house seems to self-destructing, congress can't fight its way out of a paper bag, and janet yellen was last seen windsurfing in the caribbean.
129
"i heard an expert on cable news "
I think that's an oxymoron.
15
This is like 08 all over again this is what happens when you let the people that crashed the economy get away with it. They are going to do it again because we have become fools.
294
It's not really like 2008 - not in the US anyway. 2008 was preceded by the collapse of the housing bubble, fueled by sub-prime mortgages which then cascaded into bank failures. There hasn't been any such sector failure in the US economy over the last few years. Rather, this simply seems to be the markets realizing they got a bit ahead of themselves and pulling back a bit.
The UK, on the other hand, should be a bit more worried given the recent collapse of Carillion, an event which may have the same far-reaching impact as the housing bubble, not to mention the looming spectre of Brexit.
10
It could be way way worse than 2008, because then China was out of sync in the b-cycle. Now they are in sync. So there is nothing but debt and nothing but bubbles across the whole planet. And the Fed is outta ammo. Even if they did redo quant easing there is so much debt, triggered by the tax cuts, that interest rates will rise and the cost of money has to go up. No one wants those T bills.
Sarah Huckabee Sanders: "This is exactly what President Trump has been saying all along."
130
This is exactly what Sarah Hucksterbe Sanders has been saying all along.
5
Since Donald Trump was responsible for all of the growth we had since the election, I think we can safely blame Barack Obama for this latest downturn. Right Republicans?
295
Sean Hannity thinks so.
So much for the Trump rally. How will historians remember this year? The Trump slide? The beginning of the end?
35
You assume there will be any historians left ....
Correction, bear market, inflation fears. Let's face it, nobody has a clue what's going on!
64
I'll bet Trump and the Repubs will blame this on President Obama!
60
how many of us believe we're being lied to by all these experts? "don't necessarily" is too broad for me. wake me when the nightmare has ended.
21
It's a good thing that we have a thoughtful, stable and informed President at the helm. I suppose the upside is that I won't have to listen to Trump diehards tell me how great the stock market is as proof that he's a great president.
397
Where would we be without the VSG?
And a not welcome lesson for those who may have cashing in some of their retirement savings to make purchases during the peaks of the past month or so.
16
It was only a question of when, not if, a market correction would happen. The only surprise is how quickly equity prices have fallen from their recent (overpriced) highs -- but maybe not so shocking considering how quickly stock values rose to levels of "irrational exuberance."
President Trump, be careful not to boast about rising stock prices. The market has given back almost half of the "Trump Rally" in about a week.
354
It‘s true that investors around the world and in the most important stock markets didn‘t really have an alternative to let her money work as long as the FED or for example the EZB (European Central Bank) try to manipulate the development of Internat rates in order to achieve targets of Inflation rates. US tax reform or political events for example giving Germany a government after months of uncertainty within Germany and Europe influence stock markets also. A correction of decline is necesssary and investors shouldn‘t be afraid of. It needs to proof the portfolio. Usually the growth of earns and good strategic aims are the most important thing for development for companies. Because of the Growth of most important countries or regions of the world I assume that stocks in U.S.A. and Europe will rise again. It‘ s got to be carefully surveyed the change from „cheap money“ which central bankers started during world economic and finance crisis starting in 2008 after Lehmann & Brothers. As long as countries like Italy use bonds to finance their never ending story of depts stock markets and the corresponding markets of money will be influenced by efforts of the Central bank. European or asiatic buyer of bonds finance the American growth, the consumption of people. Digitalisation and its effects just make this processes faster. That‘s why volatility of stock but also currencies around the world change in their relation to each other; investors also surch for good interest rates daily
The Dow is up an amazing 18% (!!) for the past year (Feb 8, 2017 to Feb 8, 2018). Since March 2009, nearly 9 years ago, it’s up 17,000 points (practically FOUR TIMES the March 2009 Dow of 6500 to today’s close of 23,860). Anyone thinking this is a “problem” has serious “entitlement” issues. The market averages 8-12% per year over periods of 15 to 30 years. You cannot time the market. You have to be in the down days/years to be in the up days/years. Trying to time the market is a fool’s errand. Just go with the flow. Stay in for the long haul. Low cost Vanguard/Fidelity index funds, buy and hold, for the long term. Ignore the day to day “noise” and “experts” on TV. Park your money in the market, leave it in, go to the beach, enjoy time with friends and family. I speak from experience and say this not to “show off” but to illustrate that it’s really not that hard… Since 1995, I have put money INTO the market (only Vanguard/Fidelity index funds) and have never sold. That’s the way to do it. When you have extra money, ADD. Ignore anyone who tries to tell you it’s “time to get out” or “time to get in.” It’s always time to get in. I’ve seen many ups and downs over 23 years. But, overall, the direction is UP… and the returns are FANTASTIC, overall (the Dow was in the 4,000’s when I started investing).
164
Agree with most of your points here regarding investing in index funds to minimize fees, but not that you shouldn't be ready to switch to cash at the first sign of the market downturn. I did this with my IRA and 401k as I wasn't willing to "let it ride" and watch someone else take the gains I had in the last year.
I'll repurchase my equity index funds at a 20% discount, thank you.
That is how you should invest your retirement funds.
10
@ABC123 Never selling is a great strategy if your plans are to live forever.
8
Just depends on when you will need that money and how much risk tolerance you have.
8
Boy those high speed trading algorithms got stuck in a GOTOPANIC loop pretty quickly.
108