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Author: ptheland Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75337  
Subject: Re: Wht Say You All Here.... Date: 7/17/2013 4:20 PM
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The articles I've seen say that we are in for a drastic (Maybe 75 to 80% or more of value lost) plunge in the market. I think mainly due to - so the articles hint - the fed printing money and all the other banking woes, etc., etc., ad nauseum.

I love it. On one hand, these prognosticators say that printing lots of money will cause the market to crash. On the other hand, they say it's going to cause lots of inflation - which would cause the market to skyrocket. So which one is it?

The reality is that these writers for the most part don't have a clue as to what's going on.

The reality is that over long periods of time, the stock market goes up. Here's a chart of the S & P 500 from 1950 to the present. http://finance.yahoo.com/echarts?s=^GSPC+Interactive#symbol=... Any market drops you remember have all recovered today. (Rather convenient timing for that comment, as we are at an all time high on the S&P this week.)

A 75% drop from today's level (I'll use 1680) would be to 420. We haven't seen that since the early 1990s. An 80% drop would be to about 330 - or the late 1980s. I think the odds of such a drop are vanishingly small. It would be more prudent to be concerned about drops of 10% to 20%.


--Peter
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