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Bear markets are a great opportunity for young investors to buy cheap stocks

Posted on 6/6/22 at 5:16 pm
Posted by Street Hawk
Member since Nov 2014
3459 posts
Posted on 6/6/22 at 5:16 pm
...and watch them become even cheaper.
Posted by saintforlife1
Member since Jul 2012
1321 posts
Posted on 6/6/22 at 5:17 pm to
But low. Sell lower. Every trader's dream.
Posted by Shepherd88
Member since Dec 2013
4579 posts
Posted on 6/6/22 at 5:36 pm to
“The stock market is a device for transferring money from the impatient to the patient.”
Posted by Turf Taint
New Orleans
Member since Jun 2021
6010 posts
Posted on 6/6/22 at 6:03 pm to
Once upon a time, investors priced stocks using discounted cash flows and other nifty valuation techniques. P/E ratios made sense and crazy chit like that.

Cheap and cheaper relative to what? Yesterday’s less cheap price? Betting on price movement is today’s “investing”. A little reckoning is good for the Benjamin Graham souls.

(hypocrisy warning: I love me some index investing so am part of some of this problem)



Posted by el Gaucho
He/They
Member since Dec 2010
52910 posts
Posted on 6/6/22 at 6:29 pm to
The stock market is a Ponzi scheme invented by boomers so they don’t have to pay you a pension
Posted by LSU in the hizzle
Member since May 2022
222 posts
Posted on 6/6/22 at 8:02 pm to
quote:

The stock market is a Ponzi scheme invented by boomers so they don’t have to pay you a pension



The stock market has been around a lot longer than boomers.
Posted by LSU in the hizzle
Member since May 2022
222 posts
Posted on 6/6/22 at 8:08 pm to
quote:

“The stock market is a device for transferring money from the impatient to the patient.”


Warren Buffett quote.

Over the long term it is inevitable because the fed prints,prints,prints.

Not so much a case of assets appreciating as much as the dollar being systematically destroyed.

Why else would a brand new house in 1950 sell for 5k, and then 70 years later sell for 500k when it has old pipes, wiring, and is falling apart.
The house itself depreciated, it's a pos now.
This post was edited on 6/6/22 at 8:10 pm
Posted by Decisions
Member since Mar 2015
1471 posts
Posted on 6/6/22 at 8:49 pm to
quote:

Why else would a brand new house in 1950 sell for 5k, and then 70 years later sell for 500k when it has old pipes, wiring, and is falling apart. The house itself depreciated, it's a pos now.


You’re two thirds right about this. Buildings DO depreciate and the dollar HAS been devalued. The third (and possibly most important) leg of the value equation, though, is the LAND. Land in a good location will always appreciate. Faster than inflation and faster than material decay.

A house in a premier part of Houston is worth multiples more than it was seventy years ago because of the land’s location. You could buy the lot and level the house and still be money ahead just from the land appreciation.
This post was edited on 6/6/22 at 8:50 pm
Posted by soccerfüt
Location: A Series of Tubes
Member since May 2013
65525 posts
Posted on 6/6/22 at 11:01 pm to
quote:

Why else would a brand new house in 1950 sell for 5k, and then 70 years later sell for 500k when it has old pipes, wiring, and is falling apart. The house itself depreciated, it's a pos now.
I guess a person COULD buy a house in 1950 and not do any maintenance to it over the past 70 years, but usually home owners maintain and update their homes.

So the brick walls and the hardwood floors of the 1950 house are just as functional as they were in 1950. The old pipes have been replaced. The old wiring has been replaced. The house provides the commodity of shelter to it’s residents, just exactly as it did in 1950.

The cost of the commodity of shelter has risen dramatically since 1950, that and the appreciation of the land are why the home’s value has appreciated.
Posted by Shepherd88
Member since Dec 2013
4579 posts
Posted on 6/7/22 at 6:22 am to
quote:

Over the long term it is inevitable because the fed prints,prints,prints.


Over the long term it will bc of capitalism, not because of the Fed.

But to your point, it’s our government who is destroying the dollar due to their spending habit. The Fed is just covering their arse by printing the money for them.
Posted by go ta hell ole miss
Member since Jan 2007
13614 posts
Posted on 6/7/22 at 8:22 am to
quote:

The stock market has been around a lot longer than boomers.


Overwhelming majority of Americans were not in the stock market until the end of pensions and the rise of 401ks as an alternative retirement mechanism. The point stands. Maybe boomers not wanting to pay pensions didn’t invent the stock market, but they certainly brought it to the masses.
Posted by go ta hell ole miss
Member since Jan 2007
13614 posts
Posted on 6/7/22 at 8:26 am to
Bear markets happen every 3.5 years on average since 1929. Anyone trying to time purchases in a bear market to do it at the bottom is playing a losers game. Unless you have information of Wall Street, ,most investors should just continue DCAing in stocks during ups and downs.
Posted by southernelite
Dallas
Member since Sep 2009
53151 posts
Posted on 6/7/22 at 9:10 am to
Yes, because young people have so much free cash flow in recessions/bear markets.

What do you think causes a bear market, exactly?
Posted by Chucktown_Badger
The banks of the Ashley River
Member since May 2013
31052 posts
Posted on 6/7/22 at 9:29 am to
quote:

Yes, because young people have so much free cash flow in recessions/bear markets.


The investment horizon is more important than the amount when you're young. The point is to invest something, whatever you can, starting as soon as you can when you begin your career. Coming in at a low point doesn't hurt.
Posted by boogiewoogie1978
Little Rock
Member since Aug 2012
16950 posts
Posted on 6/7/22 at 9:56 am to
quote:

and watch them become even cheaper

PAYtience
Posted by el Gaucho
He/They
Member since Dec 2010
52910 posts
Posted on 6/7/22 at 9:59 am to
Yes millenial keep putting your chicken feed into the boomer overlords pocket

Sorry we can’t pay you a pension and houses aren’t 20k but we will do a 5% 401k match

Also all chicks are fat now and want to travel instead of raise kids
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