Latest responses to “September 2009: Net Worth Update and Stock Market Investing” Copyright 2012, MoneyBlueBook.com 454710 2009-11-16T05:23:50-08:00 Monevator Raymond, I have no problem with you buying the market now - I'm pretty bullish on equities from here long-term - but I do think you might wonder why you've waited so long? As Four Pillars says, it might be that you're better investing passively rather than judging it to be safe to re-enter the market when it's risen 50%. I don't mean this facetiously, it's a problem I see all over the money blogging world. Perhaps money bloggers discuss the very real problems so much they stop seeing the wood for the trees? Certainly, missing the first 50% of every bull market will devastate your long term returns (unless you believe you can also avoid the first 50% of the bear market plunge ;) ). Anyway, just a thought. I like your long rambling style which is close to my own heart - and blog! - and I'm going to take a look at a few more posts. Good luck with the house! 454650 2009-10-20T17:01:51-07:00 Raymond Hi MachineGhost, Well the way I invest, I invest for the future. Of course the worst is not over at this very point in time, but 6-12 months from now we will be in the clear. That's why I'm placing my bets now for the distant future. Forward looking is my approach. The reason why I held all of my funds in cash form back in early Spring 2009 was because I thought we were headed into a major economic depression that had the potential to last 5-10 years or longer...based on what people were screaming about back then. But now, I think we have cleared that hurdle. Recession yes from hereon, but catastrophic depression-no. Retesting the March lows will not happen in my opinion. That occurred during a period of major bank failures and amidst serious questions of whether the federal government would do whatever it took to bail out the economy. It's quite apparent that they are now determined to do just that. All of the fear and gloom sentiment that remains is very healthy...I think it confirms to me that we are not experiencing another wave of irrational exuberance as we climb out of this recession. Yes, there is also something very troubling about foreign governments like China buying up all of our debt to power us out of this economic recession, but I think with their help, the US economy can and will successfully recover in the coming years. 454640 2009-10-20T08:23:36-07:00 MachineGhost No, I don't believe the worst is over. We're now starting a second wave of mortgage resets that dwarfs the first in terms of $. That means even more foreclosures and even more unemployment. In addition, the regional and community banks are now effectively bankrupt with commercial mortgages defaulting (unlike homeowners, commercial owners wait and wait and wait until all tenants are effectively gone before turning in the proverbial keys to the bank). Whether the market has discounted the above remains to be seen. The only problem with stocks at this point is they're not priced to deliver great long-term returns, only about 6%/year average. GAAP 2010 Q2 estimated 12-month P/E is a nose-bleeding 26.10. A retest of the March lows or a break would be the "once in a lifetime" buying opportunity. 454620 2009-10-19T01:39:50-07:00 Chris After reading the first paragraph, I thought you were joking. I guess not... 454630 2009-10-05T21:21:08-07:00 Raymond In my financial net worth reports, I factor in all of my various income sources, including affiliate income through my blogging business, capital gains through market investments, income earnings through my small legal practice as a solo practitioner attorney, and additional profits through my other real world business ventures. I have never talked about these other business ventures before but will probably discuss them more in greater detail in the future. I work part time as an attorney and blog in my spare time. I also run a few other pet projects. I graduated in the usual 3 years from law school. As for my age, I need to update my networth IQ and profile age as I'm now finally in my very early 30's. 454740 2009-10-05T20:52:26-07:00 Bulldog Gin Raymond - Just wondering in your income calcluation. You write you make over $250,000/yr and are in the 25-29 year range. How did you do it? Thought you went to law school. Did you graduate pretty early? ARe you including your blog income? thnx 454610 2009-10-05T14:21:06-07:00 AM Still want to stay in this market? Dow, Nasdaq, and S&P 500 are all tanking big time today. Lots of problematic noise coming from the Federal Reserve today about creating a system to allow these formerly too big to fail companies the ability to gently fail if need be. Scary stuff if you're an investor! Yes things look better but this will not be a V shaped recovery...I predict months if not years of sluggish growth if any 454680 2009-10-05T13:21:14-07:00 Financial Samurai BTW, can you share your thoughts about your student loans as well, and why not pay them off? I'm in the similar predicament, as my loans are at only 2.6% vs. my blended cash yield of 4%. Is it irrational for me to not pay off my student loan, if I have save $600,000 cash in the bank at 4%? Or, do you think it is completely rational? thnx 454670 2009-10-05T13:17:58-07:00 Financial Samurai Raymond - Sounds good. Although there were a lot of 'long term" investors last year who did capitulate. It's easier said than done. In the industry, the use of "long term investors" is generally used to take the long term view b/c the short term they've been wrong. It's not in your case, just saying. Good luck! 454730 2009-10-04T19:05:59-07:00 Raymond Well, if I was a short term investor looking to profit from quick gains in a matter of weeks - than yes, I would certainly need "balls of steel" to endure the volatile swings of today's market. However, I'm investing for the future and looking to hold on no matter what for at least the next 5+ years. The economy will recover sometime soon - it's just a matter of time. Now is the time to start placing long term bets for the distant future.