Looking for optimism

**james.hendrickson** · 03-17-2020, 12:16 PM

Yug - this is a normal feature of capital markets. Every few years there is a big drop. In the long run, the bias of the markets is up. This will be the case as long as global civilization holds.

**yugugelizer** · 03-17-2020, 12:25 PM

Agreed. Logically I know that, but it’s the first I’ve truly experienced (too little in 2008 to be impacted). Just thought it’d be nice to hear some personal stories about the benefits of the run-up after - something to look forward to.

**james.hendrickson** · 03-17-2020, 12:31 PM

Yug, find some great companies that are on sale right now. Buy a position you are comfortable with and hold onto it. You'll be well rewarded in 5 years.

**disneysteve** · 03-17-2020, 12:48 PM

I don't have my numbers in front of me as I'm at work, but the 2008 drop took about 2 years to get back and it's been non-stop up since then until now. I've been investing since 1992 so have seen a few cycles. Just keep at it. Keep investing regularly over time. You're young. This is a tremendous opportunity for folks in your shoes. I'm 55 so our situation is different. I'm hoping to retire in 5-7 years but I still think that's long enough to recover well from the current situation. I'm still investing and have even made some extra investments the past 2 weeks.

Hang in there.

**Singuy** · 03-17-2020, 01:22 PM

I am someone who is most excited than anything. Yes it's frustrated to look at red everyday. But there are plenty of good buys out there.

Just remember, the market ALWAYS go up. No matter what, it will go in that direction. There are zero risk if you have index funds, and min risk if you picked companies with plenty of cash to weather a storm, or are too big to fail. So continue to dollar cost average. Say "welp" if the price you entered could have been lower. No one can time the bottom except through luck. But one thing is for sure, in 5-7 years, you'll have multiplied your money more if you buy today, than if you bought a month ago. And that is a VERY GOOD THING!

How to play the market without losing money? By always staying in because the market will ALWAYS GO UP. Look at it this way, if the market went down to zero, the cash you would have sat on is not worth a damn anyways.

**greenskeeper** · 03-17-2020, 02:17 PM

Originally posted by yugugelizer View Post

Being 31, this is the first significant drop I have experienced since really being invested in the market. We have lost over $110 from a high of almost $420k in the past few weeks. My wife and I are dealing with it a lot better than I would have ever thought.

But I also thought it might be nice to hear some real life experiences from those of you who have been in the market longer. What were the impacts in 2008, 2001, etc.? How much ($ or %) did your investments drop, how long did it take to recover and how high did it go before the next?

I've been 100% stocks since 1998 (turned 18 and 401k was available) so I've been through 2001, 2008. If anything I wish I had more to invest during the downturns. You have to look at it as buying at a discount. Keep investing monthly. Once things start to turn for the better (in this case, once daily confirmed cases level off) throw as much money as you can afford into your investments.

**ua_guy** · 03-17-2020, 02:23 PM

Not every drop and recovery is the same. There is no roadmap for this, other than that people expect that the market will recover at some point. I was 26 during the 2008 crash and I'm not sure I ever paid attention to how much I was "off". 2009 was when I began saving aggressively because the bottom had already arrived and things were starting to pick up. Part of the last financial collapse took the housing market with it. I also made some appreciable money in the rebound.

Put in perspective, things haven't slid that much. We're where we were at in terms of market cap, at the beginning of 2019, which wasn't awful. A pandemic will bring different kinds of opportunities in the rebound so I think we're all watching and waiting.

**disneysteve** · 03-17-2020, 02:30 PM

Originally posted by greenskeeper View Post

Once things start to turn for the better (in this case, once daily confirmed cases level off) throw as much money as you can afford into your investments.

Here's the problem. Many anticipate a pretty rapid recovery. If you keep trying to time the bottom you may miss a sharp jump and big chunk of that recovery. One day can make a lot of difference. That's why Singuy is absolutely right. The best thing is to get in and stay in. Invest on the way down. Invest on the way back up. Just keep investing.

**greenskeeper** · 03-17-2020, 03:35 PM

Originally posted by disneysteve View Post

Here's the problem. Many anticipate a pretty rapid recovery. If you keep trying to time the bottom you may miss a sharp jump and big chunk of that recovery. One day can make a lot of difference. That's why Singuy is absolutely right. The best thing is to get in and stay in. Invest on the way down. Invest on the way back up. Just keep investing.

Applied to a 401k....yes. Applied to money I'd otherwise throw at the mortgage....no. I'm going to wait until the # of cases flattens....a much clearer signal for recovery than the 2008 crisis.

**bjl584** · 03-17-2020, 04:26 PM

Originally posted by greenskeeper View Post

Applied to a 401k....yes. Applied to money I'd otherwise throw at the mortgage....no. I'm going to wait until the # of cases flattens....a much clearer signal for recovery than the 2008 crisis.

If there ever was a situation for someone to fairly accurately time the market, this is probably it.
Cases flatten out, a drug is found to effectively treat it, or a vaccine is announced will all trigger a massive surge in the market.

**disneysteve** · 03-17-2020, 04:43 PM

Originally posted by bjl584 View Post

If there ever was a situation for someone to fairly accurately time the market, this is probably it.
Cases flatten out, a drug is found to effectively treat it, or a vaccine is announced will all trigger a massive surge in the market.

They have started phase one testing but a marketable vaccine is at least a year away.

**cypher1** · 03-17-2020, 04:43 PM

Originally posted by Singuy View Post

I am someone who is most excited than anything.

As am I. I see this as an amazing buying opportunity to get in when things are down. Which it could still go down more.

For the poster: Stay. The. Course. Yes, it's depressing to review our balances right now (don't do it then). I'm 8 years older than you, and my YTD down is probably -21 to 24%, last I checked. I got at least 20 more years before retirement.

If you've got an adequate EF to cover you for 6-12 months, and if you're comfortable with your job status, don't focus on the red right now. You're probably not going to retire for 30+ yrs. Time is on your side in the long run. Have a plan, and stick with it. Just don't let it consume you.

**Singuy** · 03-17-2020, 05:21 PM

Originally posted by disneysteve View Post

They have started phase one testing but a marketable vaccine is at least a year away.

Based on the H1N1 pandemic, July 22 2009 had a vaccine in phase 1, September 15 2009 FDA approved the vaccines. Dec it was readily available.

Editing out the mortality rate of H1N1 since I have conflicting sources.

https://www.cdc.gov/flu/pandemic-res...-timeline.html

**Thrif-t** · 03-18-2020, 05:13 PM

I have some numbers for you.

I was 42 in 2008, 100% in equities, had $40k in my 401k (I only work part time, not a high earner). Upped my 401k % to 30% of my pay and before this down turn had $225k in my 401k. Now I'm down to $196k.

I've just upped my 401k% to 50% of my pay. I'm 53 now so my allocation is 60/40. But I'm excited to buy.

Stay the course, keep buying and stop checking your balance.

Looking for optimism