What's going on with the Stock Market?

[iammalcolmx]

Do I need to panic? IIOY

[jillboston]

Probably not. But it is nerve- wracking. 973 points in the first 5 minutes. Likely bc the Chinese market dropped another 5% today. NPR analysts were saying it is a needed correction before a bubble is created.

[pixy0stix]

One of my coworkers is panicking.

[IIOY]

Would it surprise you to know that I'm not hitting the panic button yet?  This is basically China's fault, for being dishonest and half-assed. The market was also due for a correction.  I'm not reading anything at this point that leads me to believe this is start of an actual crash, aside from some hyperbole from journalists who should know better.  People are being a bit panicky but as of this moment, I think things will stabilize in the short term.

I will be glad to amend my opinion if something actually goes wrong.

[jillboston]

On top of the Chinese market situation there is the Fed finally ready to raise the Fed funds rate. And Sept. is usually the worst month for the market.

[teengirlsquad]

I just came over here to see if someone was asking this question because I need help understand what is going on.

[IIOY]

Aug 24, 2015 8:43:37 GMT -5 jillboston said:

On top of the Chinese market situation there is the Fed finally ready to raise the Fed funds rate.

...which is actually a bad idea now.  Nine months ago would have been better.

And I can't believe I'm saying this, given that I have a full-blown hate boner for the current rate.

[jillboston]

Aug 24, 2015 8:45:44 GMT -5 IIOY said:

Aug 24, 2015 8:43:37 GMT -5 jillboston said:

On top of the Chinese market situation there is the Fed finally ready to raise the Fed funds rate.

...which is actually a bad idea now.  Nine months ago would have been better.

And I can't believe I'm saying this, given that I have a full-blown hate boner for the current rate.

yes. it is. They should have pulled that Band-Aid off a long time ago.

[josieposy]

[Velar Fricative]

I'm stock market-stupid. If all the money we invest is in our 403b accounts and we're in our 30s, it's okay, right?

This makes me sad for people who are no longer in their 30s and have money in their retirement accounts. Ugh.

[fuckyourcouch]

Someone tell me if I need to login to TSP and move my funds around

[jillboston]

Aug 24, 2015 9:03:59 GMT -5 fuckyourcouch said:

Someone tell me if I need to login to TSP and move my funds around

unless you moved it all to cash  (which I don't think is a good idea at this point) it wouldn't make a difference where you moved it really.

I don't see this as a fundamentals issue like I saw the 2008 crash. I became aware in mid 2007 that the mortgage backed securities were a shell game and moved it all to cash - but I wouldn't do that in this instance.

edit- that doesn't mean that I "cashed" out my 401Ks - I just moved everything within them to money market accounts.

[fuckyourcouch]

Aug 24, 2015 9:11:13 GMT -5 jillboston said:

Aug 24, 2015 9:03:59 GMT -5 fuckyourcouch said:

Someone tell me if I need to login to TSP and move my funds around

unless you moved it all to cash  (which I don't think is a good idea at this point) it wouldn't make a difference where you moved it really.

I don't see this as a fundamentals issue like I saw the 2008 crash. I became aware in mid 2007 that the mortgage backed securities were a shell game and moved it all to cash - but I wouldn't do that in this instance.

I am a super terrified investor in general, so I currently have 70% in government securities and 30% in a lifecycle fund. I watched my parents lose a lot in the last crash so I am terrified to do any risky stuff at all with my 401k. I'm sure the 30% in my lifecycle fund is ok since I'm not retiring any time soon right? but it's scary! 

[jillboston]

Aug 24, 2015 9:14:24 GMT -5 fuckyourcouch said:

Aug 24, 2015 9:11:13 GMT -5 jillboston said:

unless you moved it all to cash  (which I don't think is a good idea at this point) it wouldn't make a difference where you moved it really.

I don't see this as a fundamentals issue like I saw the 2008 crash. I became aware in mid 2007 that the mortgage backed securities were a shell game and moved it all to cash - but I wouldn't do that in this instance.

I am a super terrified investor in general, so I currently have 70% in government securities and 30% in a lifecycle fund. I watched my parents lose a lot in the last crash so I am terrified to do any risky stuff at all with my 401k. I'm sure the 30% in my lifecycle fund is ok since I'm not retiring any time soon right? but it's scary! 

yes. it is scary when the markets tank. I've been thru it as an investor twice before. Unless you are close to retirement I wouldn't be quite as conservative as you are being. But everyone has a different risk tolerance. Now, if I'd *left* all the money in the money market funds *that* would have been stupid too. I moved it all right back into stocks in early 2009.

[fuckyourcouch]

Aug 24, 2015 9:31:52 GMT -5 RockNVoll said:

Aug 24, 2015 9:14:24 GMT -5 fuckyourcouch said:

I am a super terrified investor in general, so I currently have 70% in government securities and 30% in a lifecycle fund. I watched my parents lose a lot in the last crash so I am terrified to do any risky stuff at all with my 401k. I'm sure the 30% in my lifecycle fund is ok since I'm not retiring any time soon right? but it's scary! 

How old are you?  What percentage of your annual salary do you currently have saved for retirement?

FWIW, while there's risk in any kind of investing, you should also keep in mind that there's lots of risk in not investing as well.  With inflation averaging somewhere around 3-4%/year, you are actually losing buying power every year you don't get investment returns of at least that much.  Investing in the stock market is the single best way to grow wealth over the long term. 

And don't be afraid, just get a little educated and it's a lot less scary!  A Suze Orman-derived stat that I like to refer to a lot shows that from 1926 - 2011 the average return on a 50/50 portfolio of stocks/bonds (so not a particularly aggressive portfolio) was 8.5% over a given 10-year period. The worst 10-year return in that same time frame was 2.0%--not even negative and this includes the period of the Great Depression!  Investing in broad index funds like a total stock market fund or S&P 500 index fund combined with a bond index fund is an easy, simple, long-term portfolio that should handily outperform government securities (see three-fund portfolio description).  A lifecycle fund would work too, but you can kind of defeat the purpose of them if you only have a small minority of your portfolio in it.

I'm 28. I currently have I believe 7% going into my 401k, plus govt pension, and I've rolled all previous accounts into this one so I have a decent balance. 
I have previously contributed more but took a pay cut for this position so until a couple of raises kick in I can't do much more (I also carry all our benefits). 

This is is good info, thanks. The stock market scares the crap out of me and I know I should be more aggressive because I have a long time, but I am a verrrrrry risk averse person and it's really hard for me!

[arterr0]

Not panicking here. In fact, I'm trying to squelch the urge to dump a sizable chunk of cash in the market today

[omgzombies]

No need to panic yet. It seems like just a correction at this point.

Unless you are my grandmother, in which case panic, and get all your money out of the stock market and bank, because there is a catastrophic event coming in September according to the Shemitah cycle. I'm told that all the U.S. economic crashes have coincided somehow with the Shemitah cycle. September 11, 2001, the great crash of 2008 and apparently we're due up for another one. So stock up on canned goods, and build a bomb shelter.

[fuckyourcouch]

Aug 24, 2015 9:43:45 GMT -5 omgzombies said:

No need to panic yet. It seems like just a correction at this point.

Unless you are my grandmother, in which case panic, and get all your money out of the stock market and bank, because there is a catastrophic event coming in September according to the Shemitah cycle. I'm told that all the U.S. economic crashes have coincided somehow with the Shemitah cycle. September 11, 2001, the great crash of 2008 and apparently we're due up for another one. So stock up on canned goods, and build a bomb shelter.

I might be your grandmother, this is how my brain panics about money. Lol

[Deleted]

Local radio is cracking me up. "Don't worry, don't open your 401K today, don't call your trader, it's going to be all fine."
Two minutes later: "While our 401Ks all drop to zero, the speeds on I70 are also at zero..."

STAHP.

[iammalcolmx]

Aug 24, 2015 9:52:38 GMT -5 @choco said:

Aug 24, 2015 8:45:44 GMT -5 IIOY said:

...which is actually a bad idea now.  Nine months ago would have been better.

And I can't believe I'm saying this, given that I have a full-blown hate boner for the current rate.

Anyone else think they will hold off again to see how China keeps acting before they really pull the trigger? I said this on MMM, but our unemployment is at its lowest in decades. China is the one who is really causing this mess, so these large swings are more a reflection of how tied our financial markets are these days vs the US actually having fundamental economic concerns. Correct me if I'm wrong, but didn't our markets used to react like this to Europe's issues initially?

Anyway, I hate the journalists doing all of the fear-mongering since they know most of the sales and traders are off on their mandatory 2 week vacation right now and not many people will mock them for their ridiculous headlines.

I am going to repeat this on Facebook so I sound smart.

[IIOY]

Aug 24, 2015 9:52:38 GMT -5 @choco said:

Aug 24, 2015 8:45:44 GMT -5 IIOY said:

...which is actually a bad idea now.  Nine months ago would have been better.

And I can't believe I'm saying this, given that I have a full-blown hate boner for the current rate.

Anyone else think they will hold off again to see how China keeps acting before they really pull the trigger? I said this on MMM, but our unemployment is at its lowest in decades. China is the one who is really causing this mess, so these large swings are more a reflection of how tied our financial markets are these days vs the US actually having fundamental economic concerns.

Yes, I'm inclined to think they will hold off now. I reserve the right to change my mind if we suddenly heat up, LOL.

[iammalcolmx]

Also is this really the worst since 2007?

[lg28]

Aug 24, 2015 8:51:47 GMT -5 Velar Fricative said:

I'm stock market-stupid. If all the money we invest is in our 403b accounts and we're in our 30s, it's okay, right?

This makes me sad for people who are no longer in their 30s and have money in their retirement accounts. Ugh.

It's totally fine if you don't need your $& for a while. It could possibly suck for those in their 50s++ depending on the next few months.

[omgzombies]

Aug 24, 2015 9:52:55 GMT -5 fuckyourcouch said:

Aug 24, 2015 9:43:45 GMT -5 omgzombies said:

No need to panic yet. It seems like just a correction at this point.

Unless you are my grandmother, in which case panic, and get all your money out of the stock market and bank, because there is a catastrophic event coming in September according to the Shemitah cycle. I'm told that all the U.S. economic crashes have coincided somehow with the Shemitah cycle. September 11, 2001, the great crash of 2008 and apparently we're due up for another one. So stock up on canned goods, and build a bomb shelter.

I might be your grandmother, this is how my brain panics about money. Lol

Please don't.  That poor woman has spent so much money preparing for an apocalypse, and lost out on more stock market opportunities because of that fear.  She has probably lost out on more money doing that than she would have probably lost had something supremely catastrophic actually occurred. 

[IIOY]

Aug 24, 2015 9:58:40 GMT -5 @choco said:

Aug 24, 2015 9:56:50 GMT -5 iammalcolmx said:

I am going to repeat this on Facebook so I sound smart.

Lol quote IIOY, she sounds smarter than me all the time!

I am HOWLING. Girl, you know your stuff! And you know I love you. I miss our chit chats in these kinds of posts.