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Random thoughts: (1) People were deeply and extremely risk-averse coming out of the 2008 crisis. And now we are _starting_ to see the other end of that spectru
by lvl102 4y ago
Random thoughts:
(1) People were deeply and extremely risk-averse coming out of the 2008 crisis. And now we are _starting_ to see the other end of that spectrum. However, we are still far from the heights/throes of the dot-com boom. Those were some insane times when nothing even mattered.
(2) But keep in mind, the main driver of global economy is still increasing standard of living and middle class. And that’s far from over. We are still roughly 50% into land grab.
(3) If current pace of inflation persists, then you want to be in equities chasing cash flow in enterprises with pricing power. What you don’t want is to stay in cash. It appears counterintuitive because of all the things we experienced in 2000 and 2008. A vast majority of investors still base investment decisions with those two crises in mind. It’s a significant handicap.
- VHRanger 4y agoYes, extremely risk averse when you see behaviors like GME/crypto maniacs, tech stocks at price to earnings of 50-250
- martincmartin 4y agoIf current pace of inflation persists, then you want to be in equities chasing cash flow in enterprises with pricing power. What you don’t want is to stay in cash. And if inflation ebbs, you want the opposite. Both outcomes are possible. So it's best to hold a well diversified portfolio and not try to time the market. Just rebalance once a year.
- ProjectArcturis 4y agoI think the NFT bubble and other crypto stuff is at least as crazy as anything from the dot-com bubble.
- TheBigSalad 4y agoSure but if it's all crashes it will have little effect on the economy. In fact, people expect it to crash and will sit through virtually any dump based on the volatile history.
- unicornmama 4y agoCrazy. But so far has remained isolated from the stock and bond markets.