Stock Market

[chloevankatie]

I am not totally financially illiterate, but I am not extremely educated about the stock market either.

Can someone please explain to me like I am 5 years old what exactly is happening to the markets and possible long term ramifications?

I am curious about the where the economy is currently going and I know we have some folks here that are well educated that can explain and/or direct me to resources.

[The1Slayer]

Let's meet....... I used to be an Investor for 2 years at Paine Webber. I can tell you all about it over wine.

[Lovinglifeinaustin]

Fear, panic, and uncertainty. The market will recover. Anyone investing in stocks must be willing and able to ride out the volatility, and stay for the long run. The market will reward you for it.

FWIW, I managed a $500 million portfolio for a national charity for 12 years, including the 2008 crash. There was panic aplenty back then, and those who acted on that panic and left the market not only bought high and sold low, but they missed the recovery.

[donghead]

Best time to buy is when prices are low!

[chloevankatie]

Best time to buy is when prices are low!

I was kinda wondering if I should buy in right now, lol. People have told me they lost thousands over night. Obviously if this trend continues, there would be ramifications in the hobby world. I know a lot of you guys are investors.

[chloevankatie]

Fear, panic, and uncertainty. The market will recover. Anyone investing in stocks must be willing and able to ride out the volatility, and stay for the long run. The market will reward you for it.

FWIW, I managed a $500 million portfolio for a national charity for 12 years, including the 2008 crash. There was panic aplenty back then, and those who acted on that panic and left the market not only bought high and sold low, but they missed the recovery.

So is it just panic right now? Are they afraid of a recession or depression? How long do you think this panic is gonna hold out? I remember 2008 very well. It sucked cause I used to be able to buy property with low documentation, but not anymore. :(

[chloevankatie]

Let's meet....... I used to be an Investor for 2 years at Paine Webber. I can tell you all about it over wine.

Dude, I would love to find a mentor to teach me about stocks. I have taught myself about real estate investing and its part of my plan for world domination to invest in properties, but the stock market is harder to understand. I have tried reading books, listening to podcasts, etc., but it seems complicated to me.

[Lovinglifeinaustin]

So is it just panic right now? Are they afraid of a recession or depression? How long do you think this panic is gonna hold out? I remember 2008 very well. It sucked cause I used to be able to buy property with low documentation, but not anymore. :(

I think it’s a panic, not over a recession or depression, but over the uncertainty that the coronavirus might have on the economy. Nobody knows how long it will last, and there’s no point in trying to guess and time the market. You are only investing if you are willing to stay for the long ride - 10 or more years. If you’re trying to time the market and move in and out, you’re not investing, you’re speculating, and the odds of winning that game aren’t good.

[orbitboy]

Yeah, I'm kinda curious how the coronavirus is going to affect hobbyist & provider activities, too.

[chloevankatie]

I think it’s a panic, not over a recession or depression, but over the uncertainty that the coronavirus might have on the economy. Nobody knows how long it will last, and there’s no point in trying to guess and time the market. You are only investing if you are willing to stay for the long ride - 10 or more years. If you’re trying to time the market and move in and out, you’re not investing, you’re speculating, and the odds of winning that game aren’t good.

Couldn't the virus cause a depression?

[Lovinglifeinaustin]

Couldn't the virus cause a depression?

It’s possible, but unlikely. The consequences of the virus would have to combine with other more structural weaknesses in the economy to cause a depression. And those structural weaknesses just aren’t there.

Keep in mind that even what happened in 2008 was not a depression, but a steep recession. And it didn’t last long like the Great Depression lasted.

Stay optimistic. One of the structural weaknesses affecting the economy is consumer doubt and pessimism.

[chloevankatie]

Yeah, I'm kinda curious how the coronavirus is going to affect hobbyist & provider activities, too.

First of all, I want to preface the statement that I am going to make with saying I do NOT want this thread becoming political. I am only bringing Trump's name into this thread because whether I agree with him on most subjects or not, I think his statement that this might go away when April comes and flu season is over MAY be correct. We can't be sure because this virus is new, but it seems to be the case with viruses from the same family. This class of viruses do not like high heat or humidity and we are lucky in this instance to have both in Houston. Yay Houston! Trump may be right in this case.

The economy on the other hand, that is what I am more worried about and how it will recover.

[chloevankatie]

It’s possible, but unlikely. The consequences of the virus would have to combine with other more structural weaknesses in the economy to cause a depression. And those structural weaknesses just aren’t there.

Keep in mind that even what happened in 2008 was not a depression, but a steep recession. And it didn’t last long like the Great Depression lasted.

Stay optimistic. One of the structural weaknesses affecting the economy is consumer doubt and pessimism.

No 2008 wasn't a depression at all, but it still sucked, lol.

I am hopeful that with the technology that we have now, things will be fine. I do agree with you that doubt and pessimism are what we have to avoid.

I am curious what other structural weaknesses do you think would affect us?

[Brooke Wilde]

Best time to buy is when prices are low!

Exactly.

It's really not that hard at all.

You can even buy fake accounts with fake money while you're learning the ins & outs.

Just take the plunge & stay committed for the long haul!

[chloevankatie]

Exactly.

It's really not that hard at all.

You can even buy fake accounts with fake money while you're learning the ins & outs.

Just take the plunge & stay committed for the long haul!

I did study Warren Buffett's investment strategy with long term investing. The valuation of stocks is the part I had trouble with. I did some practice on paper, and half the stocks I picked did well and the other half didn't. So at 50/50 I might as well be flipping a coin, lol. I feel like I need to work on understanding valuation.