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The average investor also has less money to invest during down years though.
by tunesmith 4y ago
The average investor also has less money to invest during down years though.
- scarface74 4y agoThe “average” investor gets paid cash and not in stock. The public tech company employee has less to invest because a large portion of their income is in stock. The private tech company employee is screwed because statistically, they have equity that won’t amount to shit in a bull market let alone a bear market.
- loeg 4y ago> The “average” investor gets paid cash and not in stock. Not if they're unemployed, which is more likely in down markets.
- majormajor 4y agoThe "average" investor is in jobs less hit by typical recession/down market impacts, since the odds of a hospitality worker or barista having a retirement account in the first place is much lower than the odds of a white collar employee.
- scarface74 4y agoWe have an existence proof that the stock market being down is not correlated with widespread unemployment
- Godel_unicode 4y agoSo far, in this one specific downturn, sure. There is however a strong historical correlation between market downturns and widespread unemployment.
- scarface74 4y agohttps://blog.tornado.com/the-stock-market-is-not-the-economy-4ea9b349aaf6 https://blog.tornado.com/the-stock-market-is-not-the-economy...
- Godel_unicode 4y agoThat’s not responsive to what I said. It’s a snappy one liner though, so I guess cool?
- scarface74 4y agohttps://seekingalpha.com/article/4170913-unemployment-rate-and-stock-market https://seekingalpha.com/article/4170913-unemployment-rate-a... > An inverse relationship between level of unemployment and forward stock market returns. In the current quintile (2.5% to 4.4% unemployment), the average S&P 500 return over the following year is 5.6% versus and average of 12.7% in all periods. The best returns historically have come after periods of high unemployment
- Godel_unicode 4y agoAgain, cool, also unresponsive to the what I wrote.
- scarface74 4y agoYou wrote > So far, in this one specific downturn, sure. There is however a strong historical correlation between market downturns and widespread unemployment. Statistics show just the opposite
- Godel_unicode 4y agoOf course they don’t, that’s not what your articles say. Did you read them? They, respectively, say that the market is forward-looking and that major gains are made after downturns. It can simultaneously be true that major gains are made after downturns and that there has historically been a strong correlation between downturns and unemployment.
- tunesmith 4y agoI found a woman who is taller than a man, which is an existence proof that being a woman is not correlated with being shorter than men.
- scarface74 4y ago“Markets are not the economy” https://www.jpmorgan.com/wealth-management/wealth-partners/insights/markets-are-not-the-economy https://www.jpmorgan.com/wealth-management/wealth-partners/i...
- roperj 4y agoAre you arguing that the stock market is not correlated with unemployment? That’s a weird and plain stupid hill to die on because anybody can disprove it with 3 seconds of googling.
- feet 4y agoSo why don't you disprove it?
- deleted 4y ago[deleted]
- scarface74 4y agohttps://seekingalpha.com/article/4170913-unemployment-rate-and-stock-market https://seekingalpha.com/article/4170913-unemployment-rate-a... > An inverse relationship between level of unemployment and forward stock market returns. In the current quintile (2.5% to 4.4% unemployment), the average S&P 500 return over the following year is 5.6% versus and average of 12.7% in all periods. The best returns historically have come after periods of high unemployment
- thedudeabides5 4y agoThat's because the stock market falls first, and goes up once we hit the bottom. https://twitter.com/abcampbell/status/1611507672142036992 https://twitter.com/abcampbell/status/1611507672142036992
- triceratops 4y agoAnd in April 2020, we also had proof that the stock market being up isn't correlated with widespread employment.
- Retric 4y agoThe point of comparison would be average reduction in investment vs average reduction in stock price. It’s true people invest less, but stocks take much larger drops than the reduction in the workforce.
- bunabhucan 4y agoThe average investor includes people who lose their jobs during downturns.
- scarface74 4y agoWhat’s the unemployment rate - right now?