Posted: 4/24/2003 6:37:18 AM EDT
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I don't know much about it, so I ask: The economy is down, a lot of people lose money in stocks, mutual funds, blah, blah, blah... So my questions are: 1. Where the hell do all the money go? 2. Who make all the money? 3. Should people cut their loss in stock or mutual funds and take their money out? Thanks. |
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Quoted: The economy is down, a lot of people lose money in stocks, mutual funds, blah, blah, blah... So my questions are: 1. Where the hell do all the money go? Into nothingness, same place it came from. 2. Who make all the money? International Bankers - the folks that own and run the "Federal" Reserve System (read CREATURE FROM JEKELL ISLAND) 3. Should people cut their loss in stock or mutual funds and take their money out? Depends on your age and time until retirement. Thanks. |
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1. The money went into the hands of the few wise and/or lucky investors who sold the investments for more than they paid for them. 2. The profits are realized mostly by large institutional investors who are managed by professionals and have large amounts of money to invest and can diversify widely. 3. Hell if I know. I think it depends on how old you are, what you have now, your goals, your tolerance for risk, and all that other crap. I'll tell you that I have never stopped contributing about $850 a month to my 401k and haven't sold any of the other stocks and funds that I've been holding for several years. I have no capital gains to report and therefore have no need to generate any offsetting capital losses. I'm 45 and had to start at basically ground zero owning very litte other than my house after I got divorced at 40. |
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TO answer your questions: 1. The money went to the rich, that's what all good democrats know. Since there is a finite amount of wealth, it's obvious we need to tax the rich even more to re-distribute it to the poor. 2. See #1. 3. WTF are you talking about? All my retirement money is coming from social security. Plus I invested in 6 $50 savings bonds. [b]That[/b] should tide me over once I'm done working at the mill in 34 more years! Mojo, read Adam Smith's Wealth of Nations and John Locke's 2nd Treatise on Civil Government [;)] |
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Mojo you did not get caught up in the tech craze did you. I have said this in the past on this board and I will keep saying it. [b] Invest long term in good stocks [/b] I know this is not a stock but my own personal example is my IRA. I invested in an Oppenheimer Fund. I put in a total of $4000 in 92 and 94. Never touched it. Never put in anything more. Reinvested dividends. Last year I took a $3000 distribution cause I was unemployed and needed the money. This year so far I have take $2500 cause I am unemployed again. I still have close to $5000 still in there. This after the market has been taken a beating going on 3yrs now. [b]Tell me again how you can lose money in the stock market????[/b] |
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Quoted: I don't know much about it, so I ask: The economy is down, a lot of people lose money in stocks, mutual funds, blah, blah, blah... So my questions are: 1. Where the hell do all the money go? 2. Who make all the money? 3. Should people cut their loss in stock or mutual funds and take their money out? Thanks. Oh forgot. the answers to your question: 1) It revolves around. Out of the hands of one retail investor and into the hands of another. 2) Primarily intitutional investors, investment bankers and large trading houses. Foreign investors are also getting a larger chunk of the US markets. Bottomline, if you are playing the market and not buying at least 1000shrs plus, the large house will eat you alive. Example: Big Boy buys 1000 shrs XYZ @ $1. Pays $5 commision. Stock moves .125 he sells position and make $125 less $10 for commissions. Net profit $115. He can take advantage of small up ticks better with larger block and profit more in the interim. Most guys that trade large volume of shares will eventually get breaks on comission. Joe Wannabe Trader buys 100 of XYZ @ $1 does the same exact thing Big Boy does. Profits $2.50 most of these guys think they are actually making money, but they are better off working at McDonalds and not having the risk of losing money. Longer term investing is harder because you would actually need a more in depth research of each stock position. Rather than using charts you would need to use fundamental. 3) If you have a good stock portfolio and a long term goal. You should buy on dips rather than sell. Also, mojo, since you have a corp, I would talk to your accountant about re arranging your porfolio. Maybe using the corp to own it and setting up some kind of retirement trust. You may also offset some of the losses in the market against gains in your business. I am not an accountant so I will not be able to give you specifics. Offsetting loses is a great way to get rid of non performing stocks out of your portfolio and not really realizing that big of a loss. |
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Quoted: The funny thing about Stocks and such, that most people forget, is that you do not make, or lose, money on them until you sell.[bounce] Hit the nail on the head... Much of the "losses" suffered by the employees at Enron was "potential" losses. Unfortunately, is was only "potential" for [u]them[/u] - the bigwigs were able to cash out at the higher value, which, since they had knowledge before the fact, made it highly questionable (if not downright fraudulent), since the employees were "locked in", and lacked the liquidity of the bigwigs. Made them more like futures than stocks... DIVERSIFY - DIVERSIFY - DIVERSIFY |
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Quoted: I don't know much about it, so I ask: The economy is down, a lot of people lose money in stocks, mutual funds, blah, blah, blah... So my questions are: 1. Where the hell do all the money go? 2. Who make all the money? 3. Should people cut their loss in stock or mutual funds and take their money out? Thanks. 1. it went into the hands of people who sold when everyone wanted to buy. The people who sold or people who became more risk averse put that money into bonds. With falling interest rates and falling equity markets worldwide, bonds have been doing great. 2. See #1. I think most of it went into the hands of investment banks, professional speculators, and corporate insiders who recognized how wildly overvalued the market was in the late 1990's. They acquired companies in exchange for their stock, then laughed as the stock started plunging. JDS Uniphase and AOL really screwed over Nortel and Time Warner that way. 3. For the past few years, I would have said get the hell out of the market. I've said that before, and have been ridiculed by the cost-averaging, long term investing and "It's not a loss till you sell" crowd. I've been pretty wrong a lot of times talking about the market on this board, but to me, it made sense for the small investor/mutual fund owner to stay out. My mom lost something like $20,000 after the bubble started bursting in 2000. In December 2000, I asked her to just get into cash, because it was more likely the market would fall further than that she'd make make the $20,000. The Dow was at something like 10,500 then. The thing is now, all the inflation created by the Fed in desperation to fight the debt and recession is starting to kick in. Some of that inflation will find its way into stocks. Personally, I think it's more likely the Fed will start to raise interest rates, which would reduce the value of bonds. The combination of rising yields and inflation might trigger more interest in the US stock market. What I'm saying is, I would stand pat. The market's been very strong lately, especially the internet survivors like Expedia, Ebay, Yahoo, and Amazon. This aint just another bear market rally fueled by squeezing the shorts. |
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Quoted: The funny thing about Stocks and such, that most people forget, is that you do not make, or loose, money on them until you sell.[bounce] I guess that's true. But who cares? I mean, if you paid $400 for a share of Yahoo in 1999 which is worth $25 today.....do you still tell yourself it's not a loss? Even if you're a long-term investor, when do you think Yahoo will be $400 again? [img]http://hubblesite.org/db/1999/25/images/a/formats/web.jpg[/img] |