Oso planning to go pro
The Fed still has a lot of work ahead to get inflation under control. Unfortunately, a much lower stock and housing market might be the best option for them. The last three post stock market episodes saw record recoveries in short order, I do not think we will see similar rebounds once the market hits it's low point.
82In this effort to stem a long, deep recession, or worse, the Fed provided far too much money to far too many people and that created a perfect storm. This current situation may face far more difficult challenges than the three previous market crashes. Quite frankly, I believe that many Americans followed the Fed's lead and spent too much money and avoided reality.
82The last three stock market crashes, 2001, Great Recession/Housing Meltdown and Covid, the Fed spearheaded mind-boggling recoveries by QE and cheap money and that caused a large part of the problem we see today. IMO, the Fed and Uncle Sam worked in tandem to use every tool to avoid a very serious economic mess and basically kicked the can down the street. In their defense, several once in a lifetime events have occurred over the past 21 years and you would have needed a thousand stress test scenarios to have all three included in your planning.In this effort to stem a long, deep recession, or worse, the Fed provided far too much money to far too many people and that created a perfect storm. This current situation may face far more difficult challenges than the three previous market crashes. Quite frankly, I believe that many Americans followed the Fed's lead and spent too much money and avoided reality.That being said, for the past ten months I have been mainly in cash and over 90% cash the past four months. This might be one of the rare moments in time that cash is not trash. I will add, I do own some very solid dividend stocks that I have invested in for retirement and have continued to purchase shares on a monthly basis over the past year. I still believe in owning stocks and I want to have my money in the market, but this one scares me. I will add, that for over the past 35 years I was almost always 100% in the market and buying on margin very often over that time period.I might end up being 100% wrong on feelings on our economy and the stock/housing market and I hope I am. I would gladly miss out on a quick 10-15% rebound over seeing good people lose hard earned money.
Dude, still on da fence about the Turkey tourney? Wen kan expect a yay or nay, hey?
HermanThat is my feelings on my dividend stocks. Since I am buying monthly, I am perfectly fine with whatever happens to the price during downturn. If these stocks go belly up, we have bigger problems than I think we do. This is only the second time I have been this much in cash, I went into cash on 2/13/2020 because I believed that covid was going to be a far bigger global event than what was being reported. That was 100% hunch based off of the situation in China. I am now in cash because I think there is structural damage to our economy and think things could possibly go really bad.
82I believe there are always cracks/potholes in the economy, but I have never seen quite so many issues. IMO, we have national debt, supply chain exposure (not good for national security), inflation, labor shortage (which I believe ends up being much higher unemployment), too many people not prepared for economic slowdown and/or retirement, rising interest rates in a crazy overheated housing market, wage inflation, student debt, insane cost for apartment rent, commercial real estate defaults and the list goes on. To be honest, I am not sure we have smart enough leaders to allow the economy to navigate all of these issues without a lot of pain being felt.
Goose,I just read that Powell insinuated we will get to 2% interest by 2025. That doesn't sound like inflation is transitory to me.
It’s transitory