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NOTABLE! The Coming Recession (2018-2019?)

Discussion in 'Investing/Trading/Cryptocurrency/Altcoins' started by JScott, May 27, 2018.

  1. andviv
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    andviv Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

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    A friend of mine talked to her financial advisor at Morgan Stanley to review their current investment portfolio.

    The advisors told her they are recommending a very cautious approach to their customers as they are getting ready for a major market correction. Their general suggestion was to move their investments and 401(k) portfolio into a very conservative stance as a wait to minimize loses.

    Obviously, I can't tell how good these guys are, but they do manage money for millionaires and this is what they are recommending, so I thought of this thread right away.

    Assuming they are correct, how would one move their investments into a more conservative posture?

    Bonds?
    Large corps?
    Stick to Large cap indexed funds?
     
  2. MJ DeMarco
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    MJ DeMarco Raving Lunatic Staff Member Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    Not sure if it was here or elsewhere where it was said that the IPO market is a "top of the market" indicator.

    Both LYFT and UBER have not done well this far.

    Could investors finally be seeking sanity? Err... I mean profits?

    Uber’s IPO was the 5th worst over the past quarter-century, by this measure

    That would be money markets and short term bonds, especially if interest rates go back down.
     
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  3. GlobalWealth
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    GlobalWealth Platinum Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass Summit Attendee

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    I made a killing in 2008 on UST's.


    Sent from my VTR-L29 using Tapatalk
     
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  4. Tossek
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    Tossek New Contributor Read Millionaire Fastlane I've Read UNSCRIPTED

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    And how, if I may ask?
     
  5. lludwig
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    lludwig Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    New IPOs are historically without question a top.

    There are so many signals of a top.
    - PE 10 (or Shiller PE) at 30 or close to an all-time high
    - New IPOs with especially a decrease in valuation post IPO.
    - Dividend Discount Model is expecting lower than average returns
    - Inversion of the rate curve
     
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  6. Tossek
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    Tossek New Contributor Read Millionaire Fastlane I've Read UNSCRIPTED

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  7. GlobalWealth
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    GlobalWealth Platinum Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass Summit Attendee

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    In 2007-8 I liquidated nearly everything: real estate, stocks, bonds, etc.

    I was concerned about market valuations so I put almost everything in UST's.

    When the stock market crashed in 2008 there was a "flight to safety", and money flowed into treasuries.

    This made UST's explode. I just bought the Vanguard treasury etf.


    Sent from my VTR-L29 using Tapatalk
     
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  8. andviv
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    andviv Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

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    Looking at a similar scenario this time?

    Or are you taking a different approach?
     
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  9. GlobalWealth
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    GlobalWealth Platinum Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass Summit Attendee

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    The economy in general looks to be at a tipping point, but if there is something I am 100% certain of, it is that I cannot predict the future.

    With credit card, auto, and student loan debt at or near all-time highs as well as government debt with a seemingly "print to infinity" monetary policy in place, all the pieces are in place for a hard crash.

    Right now we just need a trigger for a crash.

    It could be the trade with between the US and China.

    It could be something similar to Lehman Bros crashing in 2008 that triggered the spiral down.

    Who knows when? However, I don't think the question is "if", only "when".

    Of course you could also look at Japan that peaked in the 1990's, and has been in a steady deflation or even stagflation, but no crash.

    I pulled out of the stock market a few years ago, 2014 ish, I believe. I pulled out for the same reasons as I don't want to dive in today. I think there is a lot of risk in the equity and bond markets. Of course, look how much I "lost" (or in truth, didn't make) by getting out in 2014. In hindsight, I should have stayed in until early 2018. But as I said, I am 100% certain that I cannot predict the future.

    As someone who deals with banks and other financial institutions on a weekly basis, I can say that regulatory compliance has gotten much, much worse around the world.

    With FATCA and CRS, financial institutions have seen a dramatic increase in compliance costs that has impacted their businesses, but from the consumer perspective has made things incredibly difficult.

    Ironically, this additional regulatory compliance has in part been a response to blockchain technology and cryptocurrency as a way to protect their turf but in fact has boosted the viability and use of the technology having the opposite of the intended effect.

    You can even see in the past few days how the equity markets have been diving and the cryptocurrency markets have been going up. A lot of the flow of money out of equities has flowed into crypto.

    I bring that up because crypto is definitely part of my hedging and growth strategy. As is real estate, private investments, my own businesses, and cash.

    Aside from minor short term inflation, you cannot lose money with cash.

    I made a killing in 2008-2012 in the equity markets post-crash, but only because I was very liquid.

    I have every intention of diving back in once the crash happens, I just need to be patient......and liquid.
     
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