We are a commune of inquiring, skeptical, politically centrist, capitalist, anglophile, traditionalist New England Yankee humans, humanoids, and animals with many interests beyond and above politics. Each of us has had a high-school education (or GED), but all had ADD so didn't pay attention very well, especially the dogs. Each one of us does "try my best to be just like I am," and none of us enjoys working for others, including for Maggie, from whom we receive neither a nickel nor a dime. Freedom from nags, cranks, government, do-gooders, control-freaks and idiots is all that we ask for.
Long ago, my father said to me that a Whole Life policy (preferably through Northwest Mutual) was the anchor or 'centerpiece' of his entire financial set-up.
I didn't listen. I didn't get my whole life arranged until I was 30. Still a great deal, but more expensive than it needed to be if I'd only listened to him when I was 24. While people laughed at me during the zoom-zoom years of the 80's and 90's, I was able to keep building it, while still investing on my own through a 401(k) and my own stock portfolio.
In 2007, and for a year or so afterward, my best performing asset, by a long shot, was my whole life policy. While that is no longer the case, it does show that it pays to have balance in all things. The nice thing about the whole life policy in 2007 wasn't just that it was performing so well, but it was accessible. I could borrow against it if I chose to, and not penalize myself the way selling some of my 401(k) holdings, or stocks, might have penalized me.
Generally, I stick to no or low-load funds, with some rare exceptions. Dodge and Cox, for example (which you can't get into anymore) has been my best and most consistent performer for 15 years. American Funds ICA is another which has been consistently positive, as well, for over 20 years.
I've tried the high frequency trading approach, on my own, with mixed success. I've had some big winners over the years (Apple and Oracle among the best), while getting absolutely reamed on others. The key is to not ONLY do high frequency trading, but have some long-term investments and if you do the trading, focus on options. I found when I decided to get fancy, that's when I got ripped a new one.
Steady investment, and occasional forays into trading suited me better. I haven't traded actively in over 5 years for obvious reasons, though. It's not a market for investing right now, it's pure gambling, and the table is being rigged by the government.
No, I've not missed it. I have my 401(k). However much you might make in a market like this pales in comparison to what will be lost in the inevitable correction which is coming. Given how this rally has proceeded (clearly rigged), the downside risk is remarkable.
The only problem is figuring the 'when'. If you've got money in the market now, I hope you have that answer. I've been slowly shifting my 401(k) allocation, starting this summer, to more stable investments. I've kept my real money OUT. I don't play with fire.
There is a point at which buying bonds and printing cash fails to achieve the goals set. I don't know when that point is, but given the lower highs and bigger swings we've seen, we're approaching that inflection point where the impetus of money growth yields massive liquidation.
I'm not taking chances with my money. That's why I posted about the Mississippi Bubble 2 years ago. I had a conversation with my planner yesterday and asked him what he knew about the Mississippi Bubble because he kept pressuring me to invest more.
He stared blankly at me and said he'd never heard of it. NEVER HEARD OF IT!
I'm willing to bet even the ones on Wall Street who have heard of it think we understand how money works better today than John Law did back then.
They are wrong, but it's precisely this hubris which causes bubbles and leads to crashes.
Am I predicting a crash? No, not if you mean I'm predicting this year or next. I can't do that. But yes, I am because it's inevitable and while I can't say when exactly, the time is drawing near.
I'd probably give it 50% odds this year, 60-65% next year.
Seriously, corporate earnings are not growing to expectations, layoffs are increasing again, and income is stagnant. Where's the growth coming from? Just printing money?