jungle

The fetal position is never a long term stance, but it has proven to be the correct stance over the last decade for those not quite brave enough to go short.
Interventions have changed the face of the market, and interventions are never the true face of the market. Time will tell, and the can may be kicked down the road for quite a while before it explodes.

Most radical shifts tend to be quite "unexpected".

What many of us don't understand is that deflation is the most likely, and actual scenario, driven by high public and private debt. It doesn't matter how much money is printed if very few can take on any more debt. Take a look at the last two decades in Japan. Inflation isn't a threat right now, it may be so in the future, but it takes a wage/price spiral to really get it going-and we are a very long way from that scenario.

There is real large scale deflation in the stock market, housing market and job market. High taxes and high debt insure it will stay that way for the foreseeable future.

DAL 88 Driver

Now that's not exactly true. Going short wasn't the only way to make money in the market over the past decade. The cash flow method I use consistently produced around a 12% annual yield throughout the decade. For example, in 2008 when many people were losing 40% in their 401k's, I had a 15% cash flow yield in mine. Not trying to brag at all... just pointing out that going short wasn't the only way to make money during that time period and that there were/are ways to do it without having to correctly guess the future direction of the market.

jungle

Why not describe these methods right here and now?

Then we can easily backtest them, for validity. Your move.

DYNASTY HVY

I remember that during the 80's people were pushing IRA's with the claim if you put x amount in that after a certain period of time you would have banked about a million dollars.
Any one remember this and did it work for anyone ?



Fred

DAL 88 Driver

The company that taught me this method (Snider Advisors) doesn't give this away for free. I paid good money for the course to learn this. It would take a lot of typing to give you a good overview of what this method is. At the bottom of this post, I'll put up some links that should answer many of your questions. But first, let me just make it clear that I am not trying to "sell" anyone on the idea of doing this. I have nothing to gain personally from telling folks about this, although I definitely do recommend it as being worth a look to see if it fits a person's objectives.

My intent in posting in this thread has been to show that there are other ways to invest without having to rely on market timing. Also, it should be noted that most companies do not have the brokerage link capabilities to be able to do this in their 401k's. At Delta, we are fortunate that we do.

Here are the links:

Performance Discussion

Overview of the Snider Method (just follow the links at the end of each page for subsequent pages with more detail)

jungle

I can well understand that paying 3K or so for a "method" would make one inclined to support said method.
What is somewhat troubling is a great concern about generating income and an accounting method that seems to ignore the effects on the starting capital.
There are a thousand ways to skin the cat, glad you found one you like.

jungle

Pull up a chart of the indexes from 1980 to about 1998 and you can see why that strategy worked well, by the same token you can see why it failed from about 1999 onward.

DYNASTY HVY

Yes that strategy worked real well .
Might be a good time to start looking for places where the cost of living is low especially if the market goes tango uniform every so often .
Nothing like taking a hit on the ole retirement while in retirement and not recovering for years after.

Fred

DAL 88 Driver

I use this method to manage five different accounts. 3K is a little less than one month's typical yield in my 401k. With the results I have experienced over the last five years, the amount I paid for the class has absolutely nothing to do with my satisfaction with the method. Had I been using a financial advisor to manage just my 401k, I would have paid more in one year (in fees) than the cost of the class I took.

That is a mischaracterization. The objective of the method is cash flow, not capital appreciation. It is appropriate that the "great concern" is about generating income. The effects on "starting capital" are temporary via unrealized (paper) losses that you would not ever realize unless one of your positions went bankrupt. My experience has been that the method has performed exactly as designed. I have averaged a little over a 12% annual cash flow yield, and have not realized a single penny in losses. As positions have closed, the stake in my accounts is growing quite nicely.

Absolutely. What I am doing is a rather unconventional way to "skin the cat". The objective of this method is significantly different from the objective of capital appreciation investing. It happens to fit my objectives and comfort level very well. If you read through the links, understood everything correctly, and are not comfortable with the concept... then it would not be a good fit for you. Like I said before, it doesn't matter one bit to me. I only got into this discussion because I thought I could add some perspective to the suggestion being made about putting your money in the money market.

jungle

"unrealized (paper) losses"

I think I could write a book on the perception of "unrealized losses" and how it skews a realistic view of performance.

My intention is not to be critical, but only to show there are many methods and many ways to attain a desired result. Best of luck to you.