5 ms·

Does the rule that you should get out of the stock market when random people tell you stocks are sure to go up apply in reverse? If so, this is a pretty encour

by pg 16y ago

Does the rule that you should get out of the stock market when random people tell you stocks are sure to go up apply in reverse? If so, this is a pretty encouraging sign.

rokhayakebe 16y ago
Isn't that what managers who buy undervalued stock do? Finding a stock everyone thinks is not going to do well (or much better), and buy a controlling stack of it.
riffer 16y ago
Probably better to wait until people consider you weird for your investment thesis.
- jey 16y ago
  There are far more ways to be weird than ways to be right.
startuprules 16y ago
Not when we're in a great worldwide depression. When the US baby boomers, the world's biggest/baddest consumers, are retiring or being too expensive to be hired. When automation/free software have permanently reduced human worker needs. When the developed countries - the ones with trillions of debt and aging population - have willingly given up their factories to the emerging countries, and are desperately searching for other ways to pay back their debt besides financial engineering.
- jacquesm 16y ago
  I get sick & tired of all this doom talk about a worldwide depression. It's depressing. If you play it smart then this 'depression' is an opportunity in disguise, more of a correction than a true depression. The 1929 stock market crash set the stage for World War II, and it took until well after World War II before the world had finally recovered from it. That was a depression. The current situation is, compared to that, a mere bump in the road. As long as we're not seeing hyper-inflation, the general population still has food on the table and you can actually think about where you're going to take your holiday this year we're not even close. The really bad effects of what is going on in the market are still limited to a number of markets, mostly financing and the more expensive consumer items. There are knock on effects that hurt other industries but so far without the nightmare scenarios coming true. One thing is for sure, the time of 'easy money' from stocks or real estate investments is going to be over for a while.
  - startuprules 16y ago
    "all this doom talk about a worldwide depression." Pretty sure I'm one of the only few posters here that would say the words 'great depression'. and 'voldemort'. "It's depressing" I know it is. But we as a population have to realize we are in a depression, not just a run of the mill recession like the mass media would have you believe, so we can react accordingly and not doom our future offsprings to even greater suffering. "As long as we're not seeing hyper-inflation, the general population still has food on the table and you can actually think about where you're going to take your holiday this year we're not even close." Hyperinflation, not yet. 25% unemployed in the last depression, but they had soup lines to not go hungry. US has ~20% unemployment, and we have food stamps/unemployment benefits mailed to our house. As for the holiday..well you and I, we're in the lucky 80%.
    - jacquesm 16y ago
      It's not as if the normal conditions are 0% unemployment. Also, society as a whole is so much richer now than it was in the last 'great depression' that even those that are down on their luck have it comparatively easy compared with 80 years ago. It's a world of a difference. That doesn't mean there aren't individuals that are on really hard times, but there are only more of them, it's not like the phenomenon is unique to 2010.
      - jbooth 16y ago
        No, it's not, but the current situation smacks of systemic job loss rather than cyclical job loss. It's a problem. What happens when people absolutely can't find new jobs? Self-feeding demand destruction?
        roel_v 16y ago
        "No, it's not, but the current situation smacks of systemic job loss rather than cyclical job loss." Sounds like we're back in the 80's - 'the Japanese are taking our jobs! The robots did it!' and then we went into the 20 most prosperous years humankind has ever known. I hear people cry left and right that today's job loss is systemic, but I hardly see any factual arguments to support that position. Jobs were cut over the last two years, this quarter profits are back up, and if those improved profits repeat themselves for a few quarters the confidence will come back and more people will be hired. A regular business cycle, even if the nature of the drivers is changing. Now I'm not saying it doesn't suck for those without a job, and I'm sure some people have it really rough, but come on like Jacques says - today's poor (in the West) live lives 10 times better than the kings of 500 years ago. I'm sure that's no consolation for a welfare mom who has to put her children to bed some nights crying because they're hungry, but overall, these are still great times to live in. Let's keep some perspective, put problems in the right context and fix the comparatively small deficiencies rather than cry wolf, pack cans of beans and ammo and head for the mountains.
strlen 16y ago
The article has a serious point (there's no insurance against life, other than your own ability), but I too found the jump from an anecdote to a conclusion (with scenarios mentioned already being unrealistic) distracting. That being said, I don't think this reflects negatively on Tony. There are many other writers who I respect who show this annoying tendency (somebody has pointed out that Malcolm Gladwell and Thomas Friedman are especially prone to this).
nostrademons 16y ago
Top money manager at major Wall Street firm != random people. It doesn't necessarily mean stocks are about to go down either (Wall Street has certainly been wrong too, eg. 2000 or 2007), but it's a far cry from having a shoe-shine boy tell you to buy stocks.
- Eliezer 16y ago
  No, I think "top money manager at a major Wall Street firm" and otherwise unattributed actually is random people.
  - euccastro 16y ago
    Bernard Lietaer (former central banker, successful currency speculator, one of the architects of what today is the Euro, and nowadays complementary currency advocate) starts most of his post-crisis conferences by asking the public to raise their hands if they believe that the worst of the crisis is past/ahead of us. Generally, most people will raise their hand to state their belief that the worst is still to come. Here's an example, in front of an audience of financial journalists: http://www.youtube.com/watch?v=OfMbYllbN6c http://www.youtube.com/watch?v=OfMbYllbN6c (Skip to 2:40 for the actual start if you want.)
    - jadence 16y ago
      Direct link to 2:40 of the referenced video http://www.youtube.com/watch?v=OfMbYllbN6c#t=2m40s http://www.youtube.com/watch?v=OfMbYllbN6c#t=2m40s
    - jimbokun 16y ago
      That doesn't necessarily mean you shouldn't buy stocks. It is extremely unlikely that you will time the bottom of the market just right. So even if it will continue to get worse for a while, it might still be a good decision to continue buying into the market so that when the bottom does hit, you will have bought some stocks right around that time. This all depends on your investment horizon, etc. etc.
quizbiz 16y ago
That's Warren Buffet's philosophy. "Be Fearful When Others Are Greedy and Greedy When Others Are Fearful"
jamesseda 16y ago
In a market full of speculators that is true. I think the money manager is talking about people who are moving money out of the market because they want to retire, medical expenses, income, etc.
mattmaroon 16y ago
"Be Fearful When Others Are Greedy and Greedy When Others Are Fearful" Warren Buffett. The second half indicates he thinks so. I won't lie, I've been funding my IRA early lately.

by pg 16y ago

Does the rule that you should get out of the stock market when random people tell you stocks are sure to go up apply in reverse? If so, this is a pretty encouraging sign.

rokhayakebe 16y ago

Isn't that what managers who buy undervalued stock do? Finding a stock everyone thinks is not going to do well (or much better), and buy a controlling stack of it.

riffer 16y ago

Probably better to wait until people consider you weird for your investment thesis.

jey 16y ago
There are far more ways to be weird than ways to be right.

startuprules 16y ago

Not when we're in a great worldwide depression. When the US baby boomers, the world's biggest/baddest consumers, are retiring or being too expensive to be hired. When automation/free software have permanently reduced human worker needs. When the developed countries - the ones with trillions of debt and aging population - have willingly given up their factories to the emerging countries, and are desperately searching for other ways to pay back their debt besides financial engineering.

jacquesm 16y ago
I get sick & tired of all this doom talk about a worldwide depression. It's depressing. If you play it smart then this 'depression' is an opportunity in disguise, more of a correction than a true depression. The 1929 stock market crash set the stage for World War II, and it took until well after World War II before the world had finally recovered from it. That was a depression. The current situation is, compared to that, a mere bump in the road. As long as we're not seeing hyper-inflation, the general population still has food on the table and you can actually think about where you're going to take your holiday this year we're not even close. The really bad effects of what is going on in the market are still limited to a number of markets, mostly financing and the more expensive consumer items. There are knock on effects that hurt other industries but so far without the nightmare scenarios coming true. One thing is for sure, the time of 'easy money' from stocks or real estate investments is going to be over for a while.
- startuprules 16y ago
  "all this doom talk about a worldwide depression." Pretty sure I'm one of the only few posters here that would say the words 'great depression'. and 'voldemort'. "It's depressing" I know it is. But we as a population have to realize we are in a depression, not just a run of the mill recession like the mass media would have you believe, so we can react accordingly and not doom our future offsprings to even greater suffering. "As long as we're not seeing hyper-inflation, the general population still has food on the table and you can actually think about where you're going to take your holiday this year we're not even close." Hyperinflation, not yet. 25% unemployed in the last depression, but they had soup lines to not go hungry. US has ~20% unemployment, and we have food stamps/unemployment benefits mailed to our house. As for the holiday..well you and I, we're in the lucky 80%.
  - jacquesm 16y ago
    It's not as if the normal conditions are 0% unemployment. Also, society as a whole is so much richer now than it was in the last 'great depression' that even those that are down on their luck have it comparatively easy compared with 80 years ago. It's a world of a difference. That doesn't mean there aren't individuals that are on really hard times, but there are only more of them, it's not like the phenomenon is unique to 2010.
    - jbooth 16y ago
      No, it's not, but the current situation smacks of systemic job loss rather than cyclical job loss. It's a problem. What happens when people absolutely can't find new jobs? Self-feeding demand destruction?
      - roel_v 16y ago
        "No, it's not, but the current situation smacks of systemic job loss rather than cyclical job loss." Sounds like we're back in the 80's - 'the Japanese are taking our jobs! The robots did it!' and then we went into the 20 most prosperous years humankind has ever known. I hear people cry left and right that today's job loss is systemic, but I hardly see any factual arguments to support that position. Jobs were cut over the last two years, this quarter profits are back up, and if those improved profits repeat themselves for a few quarters the confidence will come back and more people will be hired. A regular business cycle, even if the nature of the drivers is changing. Now I'm not saying it doesn't suck for those without a job, and I'm sure some people have it really rough, but come on like Jacques says - today's poor (in the West) live lives 10 times better than the kings of 500 years ago. I'm sure that's no consolation for a welfare mom who has to put her children to bed some nights crying because they're hungry, but overall, these are still great times to live in. Let's keep some perspective, put problems in the right context and fix the comparatively small deficiencies rather than cry wolf, pack cans of beans and ammo and head for the mountains.

strlen 16y ago

The article has a serious point (there's no insurance against life, other than your own ability), but I too found the jump from an anecdote to a conclusion (with scenarios mentioned already being unrealistic) distracting. That being said, I don't think this reflects negatively on Tony. There are many other writers who I respect who show this annoying tendency (somebody has pointed out that Malcolm Gladwell and Thomas Friedman are especially prone to this).

nostrademons 16y ago

Top money manager at major Wall Street firm != random people. It doesn't necessarily mean stocks are about to go down either (Wall Street has certainly been wrong too, eg. 2000 or 2007), but it's a far cry from having a shoe-shine boy tell you to buy stocks.

Eliezer 16y ago
No, I think "top money manager at a major Wall Street firm" and otherwise unattributed actually is random people.
- euccastro 16y ago
  Bernard Lietaer (former central banker, successful currency speculator, one of the architects of what today is the Euro, and nowadays complementary currency advocate) starts most of his post-crisis conferences by asking the public to raise their hands if they believe that the worst of the crisis is past/ahead of us. Generally, most people will raise their hand to state their belief that the worst is still to come. Here's an example, in front of an audience of financial journalists: http://www.youtube.com/watch?v=OfMbYllbN6c http://www.youtube.com/watch?v=OfMbYllbN6c (Skip to 2:40 for the actual start if you want.)
  - jadence 16y ago
    Direct link to 2:40 of the referenced video http://www.youtube.com/watch?v=OfMbYllbN6c#t=2m40s http://www.youtube.com/watch?v=OfMbYllbN6c#t=2m40s
  - jimbokun 16y ago
    That doesn't necessarily mean you shouldn't buy stocks. It is extremely unlikely that you will time the bottom of the market just right. So even if it will continue to get worse for a while, it might still be a good decision to continue buying into the market so that when the bottom does hit, you will have bought some stocks right around that time. This all depends on your investment horizon, etc. etc.

quizbiz 16y ago

That's Warren Buffet's philosophy. "Be Fearful When Others Are Greedy and Greedy When Others Are Fearful"

jamesseda 16y ago

In a market full of speculators that is true. I think the money manager is talking about people who are moving money out of the market because they want to retire, medical expenses, income, etc.

mattmaroon 16y ago

"Be Fearful When Others Are Greedy and Greedy When Others Are Fearful" Warren Buffett. The second half indicates he thinks so. I won't lie, I've been funding my IRA early lately.