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The Stock Market Has Not Been This Richly Valued or Avidly Loved in Two Years

edited January 13 in Off-Topic
Stocks are almost back to where they were two years ago when they hit “peak happiness,” marking the highest levels of valuation, investor confidence, financial liquidity and risk appetites achieved during this decade-long bull market.

Strong credit markets and reduced recession fears have emboldened investors.

Unwelcome news such as the U.S.-Iran confrontation are mere gut checks and buying opportunities.

Can a market both be overheated in the short term but just warming up for a longer-running advance? We just might see.

https://www.cnbc.com/2020/01/11/the-stock-market-has-not-been-this-richly-valued-or-avidly-loved-in-two-years.html

Comments

  • Are we close to the point where the Shoeshine Boy is picking stocks?;-)
  • Fear and greed make for great headlines. You need to manage risk as part of a total market strategy instead of allowing markets to manage you. Have a plan ahead of time.
  • edited January 13
    Hi @Gary1952,

    Thanks for making comment. Regarding your question about the shoeshine boy picking stocks.

    At the age of 12 (around 1960) I became an investor by buying my first mutual fund from money my great grandfather had given me for my share of the sale some family owned farmland. During the 60's while in junior high and high school I continued to invest some of my grass cutting money into this fund. The fund was Franklin Income Fund. My dad's broker felt that it would be a good fit for me because it would give me exposure to both stocks and bonds plus if I elected it paid a nice dividend which I could take in cash. In this way, I could have a better understanding of how investing worked and receive benefit from it at the same time.

    In the 70"s after finishing college I went to work for one of our local banks. Interesting, my broker's office was not far away ... and, I'd see him often at lunch in the downtown area. While still at the bank I make monthly investment deposits at his office and talked with him frequently. Many times, he'd give me his business card and on the back of the card was a notation that this was good for a shoeshine with Jimmy.

    One day, while getting my shoes shinned Jimmy asked me if I'd been buying any stocks lately? Told him no that I had a couple mutual funds and that Mr. Burns gave me a few of his cards and told me to have a couple of shoeshines on him. He said, working for the bank keep your shoes shined. Jimmy just laughed. He said, by the way, "I invest in mutual funds too." Which ones do you own? I told him Franklin Income Fund and a relative new one Income Fund of America. Jimmy said I own those as well. Through the course of the next couple of years with my visits with Jimmy I learned that he indeed knew a good bit about the markets and enjoyed these brief talks with him often.

    Now for Jimmy's tips ... You will just have to keep wondering!

    Old_Skeet
  • edited January 13
    Agree with Ol’Skeet. And thanks for the reflection.

    My earliest introduction to investing came from jabbering among fellow 16 year-old caddys on the area links back when the fee for going 9 holes was $1.50 and for 18 holes $2.50. Despite receiving “sub-par” wages, we often got to “rub-shoulders” with millionaires.:)

    In addition to learning things about investing, I also learned how to manage money from that experience. The golf season was short - the good times lasting only 3-4 months. One needed to plan out and adhere to a somewhat sophisticated budget to make those proceeds last an entire year. So don’t ever discount the investment knowledge to be gleamed from being among those in more humble / less glamorous professions.
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