Throwing in the Towel

Facetious much?

No, I'm serious. I read the headlines and I get really frightened. The sky IS actually falling. Time to get out.

I'm still skeptical. You typed with such conviction. Where are you putting your money?

Prime midtown acreage?

Of course I'm not selling, dude. It was a joke.

Doubling down then?

I'm already all in, bro. I don't use leverage. I have $22K in cash and over $1MM in equities. Wish me luck.

You'll be fine I'm sure, but good luck anyway. Any hints as to what you've invested in?

I own 3 stocks: an oil & gas company, a bank and an auto company. That's it.

You must know what you're doing. Seems like crazy risk for us average investors.

If you have a basket of stocks, The upside is basically 4% annualized next ten years assuming things don't go k-boom.

I hope I know what I'm doing - we'll see. I research individual companies and make large bets (percentage wise). That's the only way to outperform the S&P in the long run.

I'm down almost $50K today. Luckily I don't care about the short run.

How many equity investors will be unable to sleep once again? When you put your money in real estate there is no ticker. You are forced to only look long term. No stress induced health problems AND a place to enjoy :) Been there so I know the anxiety. Imagine the options trader, must be having heart attacks.

"That's the only way to outperform the S&P in the long run."

What about buying ETFs (especially those that basically are S&P), tax-loss selling, and immediately replacing with a different, but nearly identical ETF?

Please consider diversifying, especially when things are this uncertain. My equities portfolio is also in the $1M range and I'm down around $16K today. If you're fluctuating by $50K on a roughly $1M portfolio something isn't right.

BSexposer...ya right..u care.

steveF, strongly disagree. Buying real estate is more nerve-wracking. No real diversification, and highly illiquid. Not the best investment, IMHO.

"If you're fluctuating by $50K on a roughly $1M portfolio something isn't right."

One day is a pretty small sample size, but FWIW, I'm down just over 2% myself today.

"ya right..u care"

I like low prices. That way I get to buy stocks on the cheap.

"Please consider diversifying, especially when things are this uncertain...If you're fluctuating by $50K on a roughly $1M portfolio something isn't right."

It's just volatility. I couldn't care less about how much my portfolio gyrates - I only care where it goes in the long term. Since 2007 I've beaten the S&P by 28% overall - that's the # I care about.

bjw..no offense but no way man!
stock prices moving every second like a hummingbird and real estate a frek-n giant land turtle. There is no comparison. Even in the crash of Sept 08-March 09 there was no way of really knowing where your "current" price was. You are FORCED to look long term. It's a beautiful thing.

bjw, yes cashflow can be a bit of a concern but put together an excel conservative P&L and you're fine. It's numbers. If u can add and subtract then you'll know about your cash.

...It's actually a little under $50K on about $1.2MM - so about 4%.

How's about just shorting 30 year T bills via an ETF?

Notice that S&P is now backtracking on downgrading the US. Hilarious - backtracking after precipitating a "crisis" atmosphere with their pronouncements. Well done, S&P.

So you own three industries, one owned by Obama, two others attacked by Obama almost daily in his speeches for not paying their fair share... good luck.

Fsttimer - I don't really care if Obama owns and/or attacks what companies I own. If things don't turn up economically (which would help my investments regardless of Obama's opinion), then we will have a new President elected in a little over a year from the other party. Either way, I will do OK.

BTW, pretty much any industry gets attacks by the Dems, except for the tech industry (cuz they all love the facebook, etc.) - and I don't invest in tech stocks.

BSex, have you owned the same 3 equities since 2007?

We should try S&P for treason against the U.S. for even the threat of downgrade.

They are downgrading the U.S., why? Because their freedom of speech and integrity? The same people would tell you to buy some "AAA" mortgage backed crap as a better alternative to U.S. Govt debt?

The US should be downgraded, it's a mess!

"BSex, have you owned the same 3 equities since 2007?"

No - 1 of the 3 I've owned since 2008, 1 since 2010 and the 3rd I just bought this year.

I can expose some BS: That over the long term your stock picks will outperform the market. Stop deluding yourself. I'll buy a few asset class indexes and rebalance a few times a year and very likely beat your long term return (along with the returns of 90% of fund managers) and at a fraction of your expense cost.
:-)

Oh, wait, you're one of the lucky 10%.

"Oh, wait, you're one of the lucky 10%"

I've beaten the S&P by 28% since 2007. Maybe it is luck - who cares what it is.

"at a fraction of your expense cost"

My expense cost? It is around $150 per year on a $1.2MM portfolio. You may want to check out how much your indexes are charging you in fees, genius.

Yup. that's called luck. 5 years? oh boy. Stocks 101 -- you think you're capable of making the right call - twice (when you buy and when you sell) - on each stock over the LONG TERM? With information that's all freely available in the marketplace? How can it be anything other than dumb luck or inside info over the long term?

A serious piece of advice -- read The Investment Answer by Murray

And yes I am a genius.

"Yup. that's called luck"

Really? You know nothing about how I invest (other than that it's "long term"), yet you know whether it's luck or skill in my case? LMAO. Ok, sure.

"With information that's all freely available in the marketplace?"

Picking stocks is about accurately predicting the future with respect to individual companies. As far as I know, there's no "information available in the marketplace" that accurately predicts how companies will do in the future.

"How can it be anything other than dumb luck or inside info over the long term?"

How did Buffett earn 20% returns per year over a 50 year period? Luck? Or skill? Think about it. Lots of other individual investors have beaten the market over a long period who didn't have inside information. But I really like that you and a lot of other people think everything is luck - that way you will never even try to use skill in investing (which benefits me).

Buffett buys companies. You buy stocks. There's a bit of a difference. Anyway, congrats on your stock picking skills.

Just please do me a favor -- when the 5 year run happens where you underperform the market by 28%, please come back here and let everyone know.

"Buffett buys companies. You buy stocks"

Buffett has never picked stocks??? LOL - man, you are clueless, bro. That's basically all he did from 1950-1970 (as a solo investor and then as head of the Buffett partnership) and most of what he did from 1970-1990 (early years running Berkshire). He still picks stocks to this day. Go read a Buffett biography and enlighten yourself.

...and, FYI, buying a company and picking a stock are one and the same. When you buy a stock, you are buying a partial ownership interest in a company.

Alan or somebody, can you find me a good quote about youth and folly or age and wisdom, or, oh nevermind.

What is mind? No matter. What is matter? Never mind.

-- Berkeley, George

West34 - a mind is a terrible thing to waste (and you shouldn't waste yours either). BTW, I'm not really that young - late 30s.

How old was Henery Hawk?

West - here's some advice for you - read this book - http://www.amazon.com/Margin-Safety-Risk-Averse-Strategies-Thoughtful/dp/0887305105/ref=sr_1_1?s=books&ie=UTF8&qid=1311887054&sr=1-1

It's pricy but worth it. You will thank me later. GLTY.

Or this one - only $12.38 plus shipping!

http://www.amazon.com/Intelligent-Investor-Definitive-Investing-Practical/dp/0060555661/ref=sr_1_2?s=books&ie=UTF8&qid=1311887221&sr=1-2

And for my final act - here you go - 100% FREE

http://www.tilsonfunds.com/superinvestors.html

And here's my final act -- I just determined that I outperformed the S&P over the past 5 years by a bit more than 10%. And my risk exposure is a fraction of yours. And it took me a total of about an hour's worth of attention over 5 years to get that return. Now who's the genius?

http://www.amazon.com/Fooled-Randomness-Hidden-Chance-Markets/dp/1587990717

Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

by Taleb

All my money is in Wayne, NJ real estate. I own a trlplex, mobile home, and taco shop.

Wayne NJ is identical to Manhattan.

Why would anyone live on West 34th Street, of all places in Manhattan?

JuiceMan, consolidate! Turn that mobile home into a taco truck and park it in Manhattan. See, Wayne, NJ real estate can be identical to Manhattan real estate.

"And it took me a total of about an hour's worth of attention over 5 years to get that return."

Well, you should write a book or something ("How I Beat the Market By Working 12 Minutes Per Year").

"Now who's the genius?"

Well, let's just agree to disagree on that one - kinda like the Dems and Repubs - OK?

"Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets"

I know, I know - it's all luck. Funny thing is, the harder I work, the luckier I seem to get. Hmmm.

A classic from Somewhereelse:

The fictional village of Graham-and-Doddsville was introduced by Warren Buffett in 1984. The edited transcript of a talk given by Buffett at Columbia University is included in the Appendix of a special edition of The Intelligent Investor titled "The Superinvestors of Graham-and-Doddsville." Buffett presents an analogy of a national coin-flipping contest whereby everyone in America wagers one dollar on their ability to call a coin flip. The following is only a summary based on the version presented in the book but it includes current population numbers and additional commentary. Text in quotes are directly from the Appendix of The Intelligent Investor.

"I would like you to imagine a national coin-flipping contest." Let's imagine all 268 million people in the United States are asked to wager one dollar on their ability to call the flip of a coin. "If they call correctly, they win a dollar from those who called wrong." After each flip the losers drop out, and on the subsequent flip the stakes multiply. Each person has a 50-50 chance of calling each flip and approximately half of the people will lose and drop out each round. After ten flips there would be approximately 260,000 people that had successfully called ten consecutive coin flips. After 20 flips, based purely on chance, there would be approximately 250 people that had called 20 consecutive coin flips - a seemingly miraculous feat.

The surviving callers would have over one million dollars each at that point. Press coverage and inquiries about their coin calling ability would increase with each successive flip. Several callers might even attempt to profit from their good fortune by writing books on coin calling, setting up 900 phone lines, or by sending mass mailings or spam Email solicitations offering to share their secrets with intrigued members of the public.

As with winners of the lottery, its obvious that those remaining would have been blessed with good luck. But what if a large percentage of remaining coin flippers had a common characteristic or trait. What if a disproportionate number had came from one town or had been educated by one "patriarch." Would this signify that more than luck was involved in calling coin flips?

It is at this point when its intriguing to compare the coin flippers to investors. There are literally millions of investors and stock pickers trying to beat the stock market. Clearly, based on the laws of probability, many will be successful in significantly outperforming the market even over long periods of time. The question is: are successful stock pickers effectively equivalent to lucky coin callers or are there some common characteristics, styles or traits among the outperformers that signify that more than just luck is involved? It is in this context that Buffett introduced the fictional land of Graham-and-Doddsville.