Hi Jamie-fellow-Siegelite!
Yeah, I’m psyched that more regular joes like us are investing as opposed to just the big investment firms and billionaires. At the same time, s you point out many small investors take the “gaming and winning” short-term approach with their life savings — copying billionaires for whom that money is pocket change.
Us small investors can NOT use the same market-timing short-term focused gaming methods that the wealthy use with their disposable income — with our life savings.
But… when you say “…if you’re so sure the market’s going to fall …” — you misunderstand me.
I am convinced from the data that the market is being manipulated by Trump and his cronies.
I also wrote about it more explicitly here:
https://medium.com/datadriveninvestor/this-markets-being-manipulated-8c5c0d8db7f4
But I do NOT know which way the market will go in the short term. In my article here, let me remind you I also said this:
“…
1. Markets are unpredictable. Markets are made by people, lots of people, who make individual decisions. Sometimes they act like a mob, and all move in a common direction. Sometimes they act like a totally random Jackson Pollock painting.
2. Short term, markets are often wrong. Prices are a reflection of popularity, not knowledge. However, there are limits to the stupidity. Mechanisms like buying short a stock that is running too hot, or conversely buying long stocks that are un-fairly flogged. But in general, short term prices are only a reflection of crowd-sentiment, and not much else. Short term is less than a decade.
…”
So another possibility is that the stock market could be flat for a decade instead of dropping 50–80% now and slowly recovering over 2–3 years now that we have an adult in the White House.
Or against all odds, it could rocket even higher for a year or two before crashing — or who the heck knows?
I don’t know.
So I keep most of my investments since I have multi-decade timeline I focus on — and I have my cash for spending over the next few years since I am effectively retired — and if the market crashes, I will put some of that spending cash (gasp!) into the market (and perhaps have only 3 years of spending on hand for a few years).
Does that clarify my position?
Best,
S.D.
