Fed Up Investors Yank Cash From Almost Everything Just Like 2008

[dixiegrrrrl]

Mom and pop are running for the hills.

Since July, American households -- which account for almost all mutual fund investors -- have pulled money both from mutual funds that invest in stocks and those that invest in bonds. It’s the first time since 2008 that both asset classes have recorded back-to-back monthly withdrawals, according to a report by Credit Suisse.

Credit Suisse estimates $6.5 billion left equity funds in July as $8.4 billion was pulled from bond funds, citing weekly data from the Investment Company Institute as of Aug. 19. Those outflows were followed up in the first three weeks of August, when investors withdrew $1.6 billion from stocks and $8.1 billion from bonds, said economist Dana Saporta.

http://www.bloomberg.com/news/articles/2015-08-28/fed-up-investors-yank-cash-from-almost-everything-just-like-2008

this little tidbit is one of example of THIS trenchant piece which says we ARE in a crash:

Screw it, I’m calling it. I’ve been watching the so-called “markets” of China, the United States and a couple dozen other countries fall off a cliff, get up, stagger upward, fall off another cliff, and repeat. I’ve been listening to the chattering class say over and over again, this is normal, seen this before, everybody buy the dip. I’ve been watching the zombie oil-fracking revolution in this country go into spasms, jerking a few feet forward, a few feet back, gasping for breath, while the cheerleaders agree: perfectly normal, blood pressure okay, reflexes good, lend them more money. This is not normal, it is not okay, it is the Crash of 2015.

We will not likely agree on this until we stop using wildly different languages with which to discuss it. First of all, to refer to these things as “stock markets,” as if they were places where equities were bought and sold based on the soundness and prospects of the companies listed, is akin to putting your faith in the tooth fairy and Santa Claus.

These places are casinos filled with gambling addicts using other people’s money to bet, not on the future of a stock but on the popularity of a stock among the greater fools on whom the gambler must unload the shares of Consolidated Aggregators he just bought on the dip. In this casino, trading in shares themselves is like playing the slot machines, there in the lobby of the casino for the amusement of the little people risking their quarters. The real games are played in private rooms with derivatives, futures, hedges, credit default swaps, junk bonds. The master of the universe are even gambling on the outcomes of corporate lawsuits (and for what reason, do we suppose, has that practice alone drawn the disapproving attention of the drones of Washington?). They are buying hedges against the volatility of securities indexed to the volatility of the market. If you can think about that one for more than 30 seconds without your head exploding, your mellowness index is in the stratosphere. Increasingly the gambling is being done by machines, programmed by the Masters to detect the circumstances under which they are to blow up the world.

http://www.dailyimpact.net/2015/08/31/the-crash-of-2015-its-here/

[Erich Bloodaxe BSN]

1. And it's exactly the wrong move.

When you cash out AFTER you've lost money, you've fed the rich, who are buying up your stocks on the cheap. You need to cash out when you're riding high, then wait it out til the next crash to get back in.

[RKP5637]

2. K&R!!! n/t

[GreatGazoo]

10. Selling in July (18,000+) was a pretty good move

Hard to lose money selling at the top of the market.

Selling now is still a good call because the market will likely be significantly lower by mid October. The next big move upward won't come until the election is predictable IMHO.

[RandySF]

3. Irrational panic

Fine, I'll take advantage of the lower prices.

[leftofcool]

4. Stocks rise and fall all the time. Don't panic.

[vinny9698]

5. All insider trading done to enrich the chosen few.

A few get caught because they get greedy and arrogant. The smart ones milk it, slowly.

[Rex]

6. They just don't care how many or who gets hurt by their greedy ways.

The .01% are really trying hard to destroy the planet and all the people on it. All for wealth, power and love of money. I hope in the end it will all be worth it as not even their own children will be able to survive on the planet we are creating for them.

[yellowcanine]

7. "Screw it, I’m calling it." Please proceed. You first. I will leave my money where it is, thank

you. And buying more each biweekly, so thanks for helping to drive down prices so that my deferred comp dollar buys more shares.

[Rex]

8. That is how it needs to be done, don't let the uber wealthy sponge up all the money!

Do exactly like they do, wait until the floor drops out and then buy up everything you can for pennies on the dollar.

[flamin lib]

9. There is an alternative investing philosophy for those within 10-15 years of retirement.

Please note that this does not constitute advice, it's just something that's working for my wife and me and it requires a substantial sum of start up money.

We have invested in only stocks that pay dividends and have been without interruption and without decrease in cash outlay for more than 20 years (called dividend aristocrats in the lingo). As we accrue cash from dividend payouts it is re-invested in more of the same. The average of all the dividends is +- 5% of the portfolio. Because we do all the trading there are no brokerage fees.

It gets a little squirrely talking %s as most dividends are based on profit, not stock price and the actual $$ remain level. If stock price rises the dividend to price % changes downward and vice versa but the $$ payout stays constant.

These are very conservative stocks and as such do not increase in stock price very much, usually 5% or less, but adding any increase to dividend re-investment the value growth is near 10% depending on the mix. Conversely the return will never be below the dividend. Besides, with this philosophy who cares what the stock price falls to?

With 25 years of 401k contributions, some matched by employer (years ago, nobody matches anymore), we hope to be able to maintain our lifestyle with our SS payments (still the best return on investment out there) and the dividends. The IRS will make us cash out some amount annually after I reach 70 (I think) and we plan to re-invert the after tax remains back into something tax exempt.

We started this during the crash of '08 when our 'managed' portfolio was bleeding $ thousands a month. We took a 6 digit penalty to fire the incompetents but made it up in less than year and things have been going as planned ever since. If it all goes as planned we will make our kids and grand kids verrrrrry happy when we shuffle off this mortal coil. If not we'll die broke with lots of pictures and memories.

This is working for us, YMMV.