Fat Lady Singing "As Good As It Gets"

The irony of the day comes from headline news on Caterpillar, 3M, and Coke.

Realist, there are other options, too, if you expect a choppy, mostly sideways market. A traditional approach is to move a portion of your assets to bonds and/or gold. For example, if you have a portfolio of 70% stocks, 20% bonds, and 10% gold that is going to be less volatile portfolio than 100% stocks. Then if one asset class outperforms, the others, you periodically re-balance.
Another option would be to sell some out of the money covered calls. Because the volatility is high, the prices for covered calls should be high. If you sell them well out of the money, you won't get a lot, but it will be like a second dividend. I never recommend anyone buy options, but selling them is not necessarily a bad idea. Because the market makers take a big cut, you definitely don't want to trade them, but rather sell them high and out of the money, and then let them expire worthless. If your stock does get called, since the price was high, it means that you did get a nice profit in the process.

As food for thought, how many "Stay the Course-Invest for the long term" prudent prognosticators on this board have ever lived through a 15 year Secular Bear Market? Got to ask yourselves, do you have the stick-to-it-ivness to hold out for that long, before capitulating and selling way off the highs previously achieved in the preceding bull market?

Another name for buy-and-hold is: saving. That would be a wise thing to do in a healthy economy, because there would be a positive yield on safe investments. But yield is exactly what the Fed has destroyed. There is no yield, and saving is dead. Wealth creation has been systematically squandered. Your local bank's CD rates tell the whole story. The "investors" who are making gains in this environment are not capitalizing on yields, but on speculating against the next guy. It's a game of grab the better chair on the deck of the Titanic. It still looks a lot like investing and saving, and that is part of how the Fed pulled it off, because if everyone felt their capital-earning power going down the toilet, there'd be outrage. As it is, those with assets still feel like their "investments" are doing well. Who knows how long this can go on. But over time the fact that the real economy (which is not numbers in computers!) has no real yield will be a problem felt by more and more people.


"The "investors" who are making gains in this environment are not capitalizing on yields, but on speculating against the next guy."

Just like everyone is speculating with gold, because it does not have yields at all?

"real economy (which is not numbers in computers!)"

Actually those "numbers in computers" are real economy too. It is called technological advancement where our governments don't have to waste paper anymore to print IOUs (we could have cut some trees to make some paper, but, thanks to computers, we did not have to. How cool is that that we saved on human labor?). And thanks to those "numbers in computers" at least taxation becomes somewhat fairer, because while one can hide paper notes, he can't hide "numbers in computers". Though, agreeably tax system could be improved even more, but that is different story.

Wagner, you are right that computer systems are real capital. I hope so, I work in software. I meant the numbers in computers which represent dollars: those have a precarious relationship to the real economy, especially since going off the gold standard. An example is the numerical dollar value of one's TSLA shares in a Fidelity account -- given that what Tesla does in reality is miss targets and burn capital.