Are you any better off in affording that mortgage you would have had
today?  If so, would you have to sell today?  Are you in the position to
buy today?  Had the house you want to buy declined in value since 2004?
The answer would have to be "yes" to all these questions for your
decision to be a good one based on timing.

A spokesperson from the FDIC said on CNBC this week that on average 10%
of banks are on the watch list at any one time.  And at any time you can
find several companies with crappy earnings projections.

Malkiel always was in favor of the broadest index possible.
[...]
The first edition of his book came out in '73 - there
were no money market funds, no NOW accounts, no index
funds at all.

From the '96 sixth edition:

Shortly after my book was published, the "index-fund"
idea caught on. At first, only large pension clients
were offered this investment opportunity. ...

I would not have to sell today, but with 20% down back then,
my entire down payment would have been wiped out based on
the current prices for that type of home.

Truth is, I don't think anyone has a
clue as to how this problem economy will resolve itself.

On Jul 24, 8:26 am, Michael <gen...@verizon.net> wrote:
Truth is, I don't think anyone has a
clue as to how this problem economy will resolve itself.

We know that the population of the U.S. keeps buying food, clothing,
and shelter, so a market for these and that which goes into making
them will continue. We know that universities and businesses continue
to innovate new products. We know that only a small fraction of the
U.S. population is losing their homes and jobs, much smaller than
during the Great Depression. We know that bubbles and their
corrections occur. This "problem economy" will pass.

Like the reply above says, this will pass.  It may be close
to done, or it might get even worse.  But historically, the
best time to get in is when everyone else is getting out,
the TV people are predicting doom, and other investors are
puking their guts out.

There are some very fundamental changes in the way people
think about their jobs and careers nowadays as well.

But I think that has been true every year of my life.  [..]

Rather than gloom and doom, think of the economy as always
being in the state of change. [..]

O
Historically, if one was planning to live in a house for 5 years,
buying was a no-brainer.

On Aug 10, 11:01 am, "John A. Weeks III" <j...@johnweeks.com> wrote:

But I think that has been true every year of my life.  [..]

Rather than gloom and doom, think of the economy as always
being in the state of change. [..]

Thanks for the info. It helps to know these kinds of problems
have been happening all along with jobs.

There are a few other things that bother me about the current
situation:
- The way unemployment data are reported has been changed. So
the unemployment (using historical methods) is actually much higher
than is being reported.
- The way inflation is computed has been changed. Again, it is
way higher if historical methods are used.
- Finally, banks have tons of assets whose worth is unknown (CDOs).

So back to the investing thing...does it make sense to stay
invested in the market when we know all of this is going on,
or does it make sense to stay out of it until at least some of
these issues are addressed?

To me, it looks like the govt is using taxpayer money to plug
holes as and when they can no longer be contained. We know
there are more holes coming...their existence will be denied
and contained for as long as possible. We don't know how many
or how big. A number of economists have been warning about
these (not just one or two). Should they be disregarded when
it comes to investing?

Yawn. I've seen this movie before. Banks failing all over the place. Real
estate crashing. Businesses closing because their credit lines have been
pulled. Federal bail outs. Foreclosures. We survived that one. We'll
survive this one.

There are a few other things that bother me about the current
situation:
- The way unemployment data are reported has been changed. So
the unemployment (using historical methods) is actually much higher
than is being reported.

- The way inflation is computed has been changed.
Again, it is
way higher if historical methods are used.

does it make sense to stay invested in
the market when we know all of this is going on[?]

Could you please provide some links that give the unemployment rates
using the current method and the method that has been used
historically? I also want to see a comparison of unemployment during
the Depression and today, preferably using both methods.

- The way inflation is computed has been changed.
Again, it is
  way higher if historical methods are used.

Same question.

Could you please provide some links that give the unemployment rates
using the current method and the method that has been used
historically? I also want to see a comparison of unemployment during
the Depression and today, preferably using both methods.

When you buy stocks, do you plan to hold them for the long or short
term?

Historically, if one was planning to live in a house for 5 years,
buying was a no-brainer. For someone who bought at the
peak of this bubble, that is not true...

The funny part about the whole retirement
investing game is that if you can afford to take the risk
then you don't need to be invested in stocks.
This last comment is based on what I got from Zvi
Bodie's "worry free investing".

Anoop

One using his TIPs would need to save a
huge percent of their income so their withdrawal rate will match the
TIPS return.

For now, this shows the years where the computation
changed (there's a footnote for every year where that
the direct comparison is not valid).
http://www.bls.gov/cps/cpsaat1.pdf

http://www.cepr.net/index.php/press-releases/press-releases/unemployment-rate-rises-to-5.7-percent,-economy-loses-51,000-jobs/
puts current unemployment at 10.3%,

When you buy stocks, do you plan to hold them for the long or short
term?

There's the catch. If I buy them to hold for 30 years
and I'm under at the end of those 30 years, can I reverse
that time? I cannot.

Elle, is that you? If so, good to have you back with us.

Even our new CPI measures (CPI-U, CPI-W) do not fully account for the
inherent biases (namely substitution, outlet/wholesale, new product,
and quality variance).

Are you saying you do buy stocks with the intention of holding them
for the long term? Or do you never buy stocks?