Fear & Greed

Miss_Pixie said:

My Brother told me this when he was drunk and it's served me well...

Treat every situaton like a dog would... If you can't Eat it, Chew on it, or Hump it...Piss on it and WALK AWAY

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amicus said:

~~~

Thas worth a quote...just to prolong the ecstasy...



ami

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trysail said:

How many people are aware that stock market ( as measured by the S&P 500 ) returns for the ten ( 10 ) years from 1 April, 1999 through 31 March, 2009 were WORSE than the Great Depression ( 1 January, 1929 through 31 December, 1938 )?


Even with the "bounce" that's occured since March, 2009 the decade of 1 April, 2000 through 31 March, 2010 is roughly comparable to the Great Depression.

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You are, of course, "preaching to the choir" with respect to our fiscal and monetary profligacy. We are getting perilously close to the edge of prudence and may, in fact, have already crossed the point of no return.

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elfin_odalisque said:

I was quite an Obama fan - pre-crisis and pre-election - he is clearly now a major risk to our well-being in everything from economic matters to oil spills, overseas wars and simple diplomatic relations with our allies.

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Aug 23, 2010 (Reuters) - U.S. railroad Norfolk Southern Corp (NSC.N) is marketing 100-year bonds in a move to lock in low borrowing costs, a company spokesman said on Monday.

The bonds, expected to be priced later on Monday, are a reopening of a $300 million 100-year issue Norfolk Southern sold in 2005, according to IFR, a Thomson Reuters Service.

The decision to sell the debt was "based on the current low interest rates and the strong appetite among buyers for 100-year bonds," said Norfolk Southern spokesman Robin Chapman.

Norfolk Southern is the latest in a stream of companies taking advantage of low borrowing costs as falling Treasury yields push rates lower on all types of bonds.

Average corporate bond yields last week dipped to 3.775 percent, nearly matching a record low of 3.759 percent hit in June 2003, according to Bank of America Merrill Lynch data.

Century bonds are rare and have fallen in and out of favor over the years. Walt Disney Co (DIS.N) International Business Machines Corp (IBM.N) and J.C. Penney Co (JCP.N) sold 100-year bonds in the 1990s, while bond insurer Ambac Financial Group (ABK.N) sold 100-year debt in 2003.

Long-maturity bonds are typically sold by companies with household names or a long history of solid earnings.

Norfolk Southern, which dates to the start of Southern Railway in 1830, is already 180 years old.

Traders said the Norfolk Southern bonds may find demand from insurance companies which need to match their long-duration liabilities with a long-term income stream.

The bonds are expected to yield about 230 basis points over Treasuries, which would be about 90 basis points more than Norfolk Southern's seasoned 30-year debt, one trader said.

Though long-maturity bonds are at greater risk of falling in price when interest rates rise, 100-year bonds are not much more sensitive to rate changes than 30-year bonds, the trader said.

Goldman Sachs is bookrunning manager for Norfolk Southern's new issue, which will be a minimum of $100 million in size, IFR said. The original issue was priced at par in March 2005 with a 6 percent coupon.

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Hall of Fame catcher Yogi Berra had a lot to say about baseball that could also be applied to everyday life. His unique way of saying things made people laugh, but his candor often gave them pause, too. Here are six "Yogi-isms" that relate to investing.

"If you don't know where you're going, you might wind up someplace else."
Have a plan and stick to it. You can't plan for the future until you know what you want the future to hold. Think you need $2 million to retire comfortably at age 65? Want four years of college tuition for your daughter? Write down the facts and anchor those big-picture goals in reality, estimating what they'll cost.

Putting your plans in terms that you can measure will help you stay on course even if your goals change or the market fluctuates. It can also help you commit to saving and investing consistently.

"Don't always follow the crowd, because nobody goes there anymore. It's too crowded."
Don't chase performance. While most of us know that past performance is not a promise of future returns, it seems counterintuitive not to buy in the middle of a hot streak—or to sell in a downturn. But jumping in and out of the market based on short-term results is a surefire way to buy high and sell low. Plus you may already be too late, because by the time you react, the fund has likely reached its peak and will soon be on the decline.

A more trustworthy strategy? Choose appropriate investments for your goals, periodically rebalance to maintain your target allocation, and invest for the long term. You'll be ahead of the crowd instead of chasing after it.

"You better cut the pizza in four pieces because I'm not hungry enough to eat six."
Avoid overlap. Overlapping means that your portfolio is overweighted in a particular asset class, industry, or market segment. For example, if you hold several funds that have a heavy concentration in technology or long-term bonds, you could be overexposed in those sectors.

You can achieve balance and diversification (and significantly reduce your risk) by investing a percentage of your investments in at least two asset classes—and then keeping those percentages at a relatively steady level. An even simpler strategy is to consider an all-in-one target-date fund that automatically invests and diversifies for you.

"It's tough to make predictions, especially about the future."
Don't try to time the market. Some investors keep cash assets and just wait for the perfect opportunity to buy. But predicting performance is nearly impossible. No one knows the optimal moment to invest. If it were that easy, we'd all be hitting financial grand slams on a regular basis.

A wiser approach is to take advantage of dollar-cost averaging by participating regularly in an employee plan or another automatic investment program. Contributing a set amount on a set schedule can help grow your account, and you won't have to play the market guesswork game.

"A nickel ain't worth a dime anymore."
Pay attention to costs. At Vanguard, we emphasize costs a lot, and for good reason: Costs matter. Every dollar you pay in fund costs is one dollar that could otherwise earn money for you.

A fund's expense ratio can also be a useful predictor of its relative performance: On average, since funds with higher expense ratios pass fewer returns on to their investors, these funds tend to underperform those with lower expense ratios.

So be sure to check a fund's cost before you invest. With a low expense ratio, you'll pay less to own a fund and you could keep more in return.

"I'd find the fellow who lost it, and if he was poor, I'd return it."
(Yogi's response when asked what he would do if he found $1 million.)

Invest tax-efficiently. You want to keep as much of your return as you can. And by maximizing your tax-efficiency, you can minimize what the IRS expects you to hand over.

First, choose an appropriate mix of stocks, bonds, and cash for your portfolio, and then put your investments where they'll benefit you most tax-wise. For example, hold higher-yielding or income-generating assets in tax-sheltered accounts such as employer plans and IRAs, and place tax-efficient holdings like index and tax-managed funds in taxable accounts. Positioning your investments strategically can diminish tax impact and provide the potential to add significant value to your portfolio.

Yogi claimed that "we make too many wrong mistakes," but if you stick to a plan, diversify, invest for the long term, and pay attention to costs and taxes, you can help eliminate some costly errors that could keep you from reaching your goals.


© 1995–2010 The Vanguard Group, Inc

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Handprints said:

One method to avoid the extremes of fear and greed when investing works very well but isn't very popular: put 90%+ of your long-term savings into a pile that you can only rearrange twice a year (once, if you really want to be hardcore about it.) The single largest reducer of most people's retirement income is the trading costs they racked up screwing around with their portfolios while they were working. If you can't learn to sit on your hands (and you've got more than, say, USD500k in savings, put the money into a trust that you really, with lawyers watching can't touch more than twice a year.

Hope that's of use,
H

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It’s official: Ron Paul to lead House Federal Reserve oversight

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JackLuis said:

Ben is going to shit!

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trysail said:

...The stock market does provide a broad social benefit...

....In the long run, investing in the stock market has been a "positive sum" proposition.

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It facilitates the aggregation of capital necessary for the establishment and funding of businesses. That, in turn, enables large pools of capital such as employee retirement schemes to participate in economic growth. In the long run, investment in the ownership of business has provided returns higher than that available from alternatives such as cash or bonds and more than the rate of inflation ( as measured by the U.S. CPI ). In the long run, investing in the stock market has been a "positive sum" proposition.

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