"PRINCETON, NJ -- Unemployment, as measured by Gallup without seasonal adjustment, hit 10.3% in February -- up from 9.8% at the end of January. The U.S. unemployment rate is now essentially the same as the 10.4% at the end of February 2010."
"The percentage of part-time workers who want full-time work worsened considerably in February, increasing to 9.6% of the workforce from 9.1% at the end of January. A larger percentage of the U.S. workforce is working part time and wanting full-time work now than was the case a year ago (9.3%)."
The stock market is also WAAAAAAAY over valued, with a PE of 23.93 Anytime the market is above 20, it usually sells off over the next year or 2. Over 25 and its a disaster waiting to crash. http://www.multpl.com/
I'm sure there were people like you during the great depression who thought the world was coming to an end. Of course there was no Internet then so the only people that had to listen were neighbors and pissed off relatives.
Have you done a lot of reading about the American economy over there in Norway? I've lived through many recessions. And I've been invested in the stock market for as long as you've been alive. Nothing is going to collapse now go workout.
I sometimes have the same feelings as this other youngster. We can't be anything other than terrified when all we hear is how the world is ending. Then, older and wiser guys who have heard that same bullshit for years comes in and tells us everything is ok. I'm still going to invest in real estate b/c people always need a place to lay their head and I have more control over the investment.
You have two very good reasons to invest in realestate. But don't invest in realestate over the mistaken notion that the worlds economy is going to collapse. Just keep in mind that newspapers and other media outlets are out to make money and they do so with sensational headlines. In addition to that in 2011 we are saturated with news from every direction. Therefore, things seem worse than they really are.
I know exactly what you're saying and agree 100%. I just wonder if shit really is going to hit the fan. I mean the fed system we're using now is gonna fail at some point. I think sooner or later people will revolt and I don't know how things will change. I know it's conspiracy/old man in the hills thinking, but I'm too poor to get fucked. I guess is someone was to take my stocks, bonds, and other accounts they could prolly steal my deed on land as well.
Who says it's going to fail? Some crack pot on MSNBC? Or some crack pot on T Nation?
No one is going to revolt in the US, forget that notion it's wrong minded. Where was the revolt in the early 1930's? The economy was far worse than it is today. Unemployment topped 20% and there were ten times the bank failures. On top of that there were very few entitlement programs from the government. One of the major ones was the WPA program. It was essentially a work program for those unemployed. They would dig ditches, sweep floors, shovel snow etc. Any sort of menial labor in order to get a paycheck. Anyway, no revolt is coming so don't worry about it. The majority of people in the US are quite happy. They know that we are now heading out of the recession and the worst is behind us.
You are not thinking clearly my friend. No one is going to take anything that belongs to you. Now go to work and get more!
Sorry my friend, I don't know how things work in Austria but here in the good old USA if you buy $10,000 worth of IBM you own that stock until you decide to sell it. And if you purchase a car for that same amount of money you own that car until you decide to sell it. So there's no need to qualify that by claiming that "they define what belongs to you." If you are referring to taxes that is another matter and still does NOT define what you actually own.
From your source: The figures on multpl.com are the PE10 or Shiller PE. They are the price to average earnings from the past ten years.
That is not P/E. That is an absurd ratio created purely for shock value to appease the doom and destruction crowd. I challenge you to name one reputable source that uses 10-year average earnings and then has the gall to still report this as a P/E ratio.
Actual TTM P/E is 16.5 for the S&P 500, right in line with its historical average. Forward P/E is just 14.2. By all means, sell.
If not for a couple of posters in this forum I would still have a very firmly attached extra heavy duty tin hat on. I guess the ole saying that if everybody is going one way, go the other way is good advice. A friend of mine and basically a mentor told me the same thing as Zeb. He said he didn't go on vacation b/c he knew he had to through every penny he could into the market. His returns were ridiculous. One was 40% apparently.
The one thing I thought about and might not even be true is in the movie Blow. The dude had millions in an account in another country. They took every single red cent.
Off topic: Is there a previous thread about real estate investing v.s. stocks and bonds? I don't want to start another if so.
None of that matters in the slightest. Draw a horizontal line y = 20 on the chart i linked. What happened, almost all the time?
Draw a horizontal line y = 25. What happened next?
Compare apples with apples -- >> Great Crash is in the works.
The market has risen because of massive money printing, said money handed over to Wall Street. Inflation is picking up so the relentless money printing has to stop or the dollar is destroyed. China is raising bank reserve requirements besides.
I would say one thing you can count on is change , in 30 years the world will be a totally different world . I hope it does not hit the fan , but it could , I predict the political climate will swing back , I predict labor to revolt
Right HH and don't forget to build a bunker and stash some of that powder food in the little packets. Just add water and you can eat for three years.
Stop scaring the young men on this thread HH you know nothing about the economy or how the markets move. People like Warren Buffet agree with me. But then what does he know right? He's only worth 50 billion or so.
Of course it matters. You found an arbitrary ratio with a limited data set and used it to attempt to define a trend. You've ignored any other variables and assumed the data from 120 years ago is as relevant as the data today. Don't you think there may be a reason why nobody but Robert Shiller uses the PE10? Hmmm, maybe this all has something to do with the fact that he makes money selling books, not buying and selling the market.
Check the options pricing. January '12 puts for SPY (S&P ETF) at 50% of today's prices are going for about a quarter. 25% of today's price for a nickel. Not much risk there, you could be a very rich man if you are right. Gonna go for it?