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DRC Archive Market Place
21

[quote=“a1amap, post:16, topic:590”]
Once upon a time, in a village, a man appeared and announced to the
villagers that he would buy monkeys for $10 each.

The villagers, seeing that there were many monkeys around, went out to
the forest and started catching them. The man bought thousands at $10 and,
as supply started to diminish, the villagers stopped their effort.
He further announced that he would now buy at $20 for a monkey.

This renewed the efforts of the villagers and they started catching monkeys
again. Soon the supply diminished even further and people started
going back to their farms. The offer increased to $25 each, and
the supply of monkeys became so small that it was an effort to even
find a monkey, let alone catch it!

The man now announced that he would buy monkeys at $50! However, since
he had to go to the city on some business, his assistant would now buy on
behalf of him.

In the absence of the man, the assistant told the villagers. "Look at all
these monkeys in the big cage that the man has collected.

I will sell them to you at $35, and when the man returns from the city,
you can sell them to him for $50 each." The villagers rounded up all
their savings and bought all the monkeys.

They never saw the man nor his assistant again!

Now you have a better understanding of how the stock market works. [/quote]

That would be amusing if it wasnt so true…

22

[quote=“icy1155, post:21, topic:590”]

[quote=“a1amap, post:16, topic:590”]
Once upon a time, in a village, a man appeared and announced to the
villagers that he would buy monkeys for $10 each.

The villagers, seeing that there were many monkeys around, went out to
the forest and started catching them. The man bought thousands at $10 and,
as supply started to diminish, the villagers stopped their effort.
He further announced that he would now buy at $20 for a monkey.

This renewed the efforts of the villagers and they started catching monkeys
again. Soon the supply diminished even further and people started
going back to their farms. The offer increased to $25 each, and
the supply of monkeys became so small that it was an effort to even
find a monkey, let alone catch it!

The man now announced that he would buy monkeys at $50! However, since
he had to go to the city on some business, his assistant would now buy on
behalf of him.

In the absence of the man, the assistant told the villagers. "Look at all
these monkeys in the big cage that the man has collected.

I will sell them to you at $35, and when the man returns from the city,
you can sell them to him for $50 each." The villagers rounded up all
their savings and bought all the monkeys.

They never saw the man nor his assistant again!

Now you have a better understanding of how the stock market works. [/quote]

That would be amusing if it wasnt so true…[/quote]

Unfortunately, icy, it’s only half true.

The part missing from this story is how the man’s (and his assistat’s) government both allowed and encouraged this behavior. And it wasn’t the right half or the left half of the government, it came from both sides of the aisle. And the caucus’ from special interest groups, aided by community organizers, cheered this on with great enthusiasm. And it created a tremendous growth in everything … until the monkey’s all ran out.

From Wikipedia on the 1973-1974 crash :

At the time, the UK's property market was going through a major crisis, and a secondary banking crisis forced the Bank of England to bail out a number of lenders.

Kind of eerie, eh?

23

Everything including bell bottoms comes around again. I always love the experts who think they are all knowing. Every since I was a kid and someone would ask if we could have another depression (Great or otherwise) they would chime in about all the great changes that were made to ensure it would never happen again. Man even I know greed (congressional or in the financial markets) will always find a way to bite the “average Joe six pack”* in the butt.

Had to give credit to Sarah Palin since she said it a 100o times in one debate.

24
Most would say that's not the best strategy either.

It might not the best for fidelity, or the market at large, but its definitely the best for me. Managed portfolios, like our 401k, dont let us invest in individual stocks. Instead we invest in how well the portfolio, ie the company, does. We dont benefit from buying low. However, by shifting my investments to ESPP, i can buy stock at its lowest cost minus my 15% discount. The good thing is that most ESPP purchase at the lowest price of the quarter(ie first or last day) so if the stock is still in a downward spiral i can simply sell the day after i buy and make a 15% profit minimum(minus tax and selling fees of course).

25

[quote=“logans_daddy, post:24, topic:590”]

Most would say that's not the best strategy either.

It might not the best for fidelity, or the market at large, but its definitely the best for me. Managed portfolios, like our 401k, dont let us invest in individual stocks. Instead we invest in how well the portfolio, ie the company, does.[/quote]

I hear you but even Fidelity has plans that have little volatility. But you are missing adding tax free money to your account and the match your employer provides. Some are really safe and although you are not going to make a mint in them you can still put tax free money aside.
I use to love my espp plan from RS. They would match 40% to a max of 8% of my pay. (first 3 years) Between 3-5 years they would match at 60% and after 5 years they matched at 80%. This was an awesome benefit. I actually had to explain how great it was to people. I made a lot of money with this plan.

26

Ill Second your word on a second great depression.
having worked in real estate for a while a few years ago I met a ton of peopel who said that the market would just keep going up. I talked a lot of my clients OUT of buying homes and staying put as well as talking numerous investors out of buying. hence why I am no longer an active realtor( talked myself out of business…)

the common thread was ingorant enthusiasm. I have wanted to believe from time to time that things will work out, that the governement will keep things in check, but post Katrina I re-evaluated that belief and have been working steadily since on changing many habits. I dont claim to know how bad its all gonna get, but I think we as americans have forgotten many of the hard earned lessons of the past. I for one am spending time learing how to can food and learing other skills to make sure that my butt is covered.
Once I get settled in here in annapolis and get a decent job my next priority is to find a fairly priced home with enough land to grow much of my own food as well as other needs… our grandparents had it right…

On the flip side of that, if I did have a full time job right now I would be cost dollar averaging into the market! Buffet is right on this one- take a look at GE thats a huge buy!
Eric

27

[quote=“firecrackerbob, post:26, topic:590”]
Once I get settled in here in annapolis and get a decent job my next priority is to find a fairly priced home with enough land to grow much of my own food as well as other needs…[/quote]

Look on the other side of the South River … down Rt 2

28

HI Ronnert,
Thats definitely an option! Depending on where I find a job, the I am thinking of the davidsonville area or possibly the easter shore around Wye mills. just need to figure out where ill be communting to. my Fiancee is at ann arundel comm college on rt2 north of 50 so either is an option for her…

one thing I have noticed is that there are more farmettes on the eastern shore and the RE taxes appear to be WAY lower for property zoned AG over there…

29

Eastern shore is also an option. If you can handle the commute, definitely a great option.