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View Diary: Ordinary people losing trust in the economic system - and doing something about it (191 comments)

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  •  Evolving asset allocations (to more fixed income) (9+ / 0-)

    that are attributable to the boomers cannot begin to account for the flight from stocks. E.g., a 65 year old has an investment horizon of 20-30 years for at least a portion of her assets. In properly functioning markets, retirees would still choose to own a lot of equity. Nobody retires and immediately dumps all the equity out of the portfolio unless other factors are at play, like an erosion of trust in our financial institutions.

    Let us not pretend our sorrow in this moment means a damn thing or changes a damn thing, because it doesn’t and won’t. -- Leonard Pitts

    by RudiB on Fri Dec 28, 2012 at 01:31:34 PM PST

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    •  I never liked using Wall Street for my base (13+ / 0-)

      I'm "retired", and my base was built on a very old school philosophy of personal economy.   Since the 60s the pyramid has been inverted with people balancing on edges and tips of the pyramid rather than on its stable bottom  We were taught that you make your most conservative investments FIRST, not last.  You first invest in things over which you have some control, not the market.  Those conservative first investments don't make a much money but they are stable.  The market is left for a time when you can afford to gamble without touching your base.  The market was a shiny temptation for my generation and now they and their children are paying for it.  The final coup of the stock market is that the only voices speaking about personal economy and investment comes from the Wall Street shills.  It's time to go back to reading the old sages and figure out what we left behind when we handed America's economic future snake oil salesmen.

      Newt 2012. Sociopath, adulterer, hypocrite, Republican.

      by tikkun on Fri Dec 28, 2012 at 03:54:33 PM PST

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      •  Very investor is different (0+ / 0-)

        A reasonable asset allocation for retirement depends on one's personal and financial circumstances, financial objectives, and (I think you allude to this) one's tolerance for risk. I would say that not everyone should own equity (stock), but it is important to offset the risk posed by inflation. Traditionally, owning stock is one (just one) way to do that.

        Let us not pretend our sorrow in this moment means a damn thing or changes a damn thing, because it doesn’t and won’t. -- Leonard Pitts

        by RudiB on Fri Dec 28, 2012 at 07:47:39 PM PST

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        •  Stocks are a Ponzi scheme. It only makes sense as (7+ / 0-)

          long as their is someone on the other side of the trade.  We have reached a time when boomers are retiring and young people coming into the market will have to defer saving for retirement because of their enormous debt, they will have to defer buying houses so boomers will not be able to convert their equity(if they have any).   The FED's manipulations has guarantee'd that people that have saved all their lives have been screwed and NO ONE has gone to jail.

          •  Bingo. A very sad, tragic bingo. But (0+ / 0-)

            spot on, nonetheless.

            This health care system is a moral atrocity. Dr. Ralphdog

            by AllisonInSeattle on Sat Dec 29, 2012 at 01:57:53 AM PST

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          •  I wouldn't go that far (2+ / 0-)
            Recommended by:
            katiec, Cambridgemac

            Stocks in theory are a good investment.
            The problem is that we've left theory many years ago.

            Back in the post-Depression society stocks gave fat dividends (which you can only give out when your company has fat profits).
               Then came the 90's, and everyone chased stock prices rather than dividends, which is the ponzi scheme that you describe.

            ¡Cállate o despertarás la izquierda! - protest sign in Spain

            by gjohnsit on Sat Dec 29, 2012 at 05:49:10 AM PST

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        •  I Use Stock (0+ / 0-)

          but my first and most important investments provide me with stability and cash flow ( all of them don't necessarily provide cash flow) If the stock market tanks massively, I still have stability and cash flow.  Without those two bases covered, a crash takes the ground out from under you and destroys your ability to get back up quickly and run.  Stocks and bonds are controlled by a lot of things....the buyer is not one of them.  The only control the buyer has over stocks and bonds is to buy or sell.

          Newt 2012. Sociopath, adulterer, hypocrite, Republican.

          by tikkun on Sat Dec 29, 2012 at 02:11:31 PM PST

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