Are stks at a good value
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Started by wglassfo - Oct. 15, 2021, 9:27 p.m.

I remember  my grand mother telling me this story

My grand father was a bit of a speculator. He bought and sold land, horses until he discovered the stk market

Every day he could get away from the farm he went to town to look at the ticker tape and numbers written on the chalk board

He started with a few stks then started to buy on margin. Well the end came and some how he managed to escape and not lose the farm. . Butt his paper wealth was gone

My grand mother then told me stories of the depression, of cutting wood to sell, any thing to pay the land taxes

I wonder if today is any different then just before the stk market crash

The Fed keeps printing money to support the financial system of bonds, stks and any thing else I don't know about

Supposedly the Fed might increase int rates a tiny bit and do what they call "taper' which means less QE of buying of assets. But I wonder how long the Fed can keep all the balls in the airr. It seems as if every fiat system fails at some time but the USD could go on for a very long time. If the USD fails the so does the world economy IMHO. China looks to have some problems with keeping the factories open. Their house values may collaspe at any time. They might inject money to save house values but then that seems to me a bit inflationary. India has the same problem. It may be that china or India could cause the world financial system to fail. I don't know. They sure got a lot of people and things could go side ways with that many people

So: my wife wants to keep buying a few stocks when the money accumulates in the bank acct. This money is supposed to go for improvements on the house. Heck we have a new stove top and oven ordered but no delivery time. We just got a new clothes washer and drier delivered after a long wait, so she thinks stks are the place to be if there is nothing else we can buy that is available

If we buy 100 stks that is a whole yr of saving so we won't get hurt too much but I am thinking we should start to save for a vechicle. I don't like payments, I want the cash to pay for it, so I save my money

But money saved in a bank loses approx 5 % a yr due to inflation. Stks such as we buy have gone up by approx 10 - 20 %/yr and pay a 4-5% dividend

So do I put my car money savings in stks and then sell the stks when I have enough stks to trade if and when it looks like the time to trade???

Looking at at least 3 yrs and then 3 yrs for the other car or truck, So 6 yrs total and then start over again. Maybe won't need another that soon but it is a  savings plan

Until the stks go bust and the vechicle needed to be traded that yr. Cash in the bank might be a little better, maybe

Comments
By Richard - Oct. 16, 2021, 8:30 a.m.
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the stock market is in a bubble and so is the housing market

By wglassfo - Oct. 16, 2021, 5:04 p.m.
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You know Richard. nobody disputes your bubble theory

But I have read about bubble this and that for so long and the bubble never has popped since when 2008, correct me if I am wrong

We had a few  thousand in the stk market. We lost approx 30 % of value. We use an investment advisor and that money is what my wife received for her pension on retirement. Yes were under water for a while but today we are above water, 

Stks haven't hurt us so far, even during the crash of 08 so in the big picture. we recovered and made new highs 

So how long until the market crashes once again


By bear - Oct. 20, 2021, 1:03 p.m.
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by some measures,  stocks are more grossly overpriced today than at any other time over the last 140 years. (my estimation).  

https://www.hussmanfunds.com/comment/mc211015/

look at the first and third chart here by hussman.  

he uses a different measure here,  but,...you could also look at price to book, or price to revenue. etc. 

by almost any measure stocks are grossly overpriced,... and when they are grossly overpriced, then stocks tend to not do well over the next 10 to 15 years.