Current events discussion

[ThxOne Premium Member]

"If we just ignore the trillions of dollars that were lost, and the zero money gained by the tariff plan, everthing went very well."

The ostrich effect.

I didn't lose anything. Who lost these "trillions" of dollars because it sure sounds excessive to me.

 

[Eggs 5,000+ posts]

Sad. How long did they hide this?

 

[Jimi77 Premium Member]

So they just gave you money out of their pocket after it was lost due to Trump's tariff announcement?
Or, do your money managers not sell when things start to drop precipitously? If that's the case, then you may want to think about changing who handles your investments.

As for my 10% explanation, it was a simplified way to show how a (what some people describe as a "nothing") drop in your rate of return for a short time can have a major impact in the big picture. It was simply pulled from the blue for easy math, but I just found ou tthat the S&P actually has historically averaged 11% per year over the past 20 years.

Yes, the market CAN move up and down naturally, even driven by things like natuarl disasters, pandemics, etc.
But HOW can if possibly be considered a good thing when the idiocy of a an idiot president directly causes it?
What's the NEXT announcement he's going to make that will casue a massive change, benefitting the insiders that knew of his plan to announce?
Explain, if you will.
View attachment 65531
And, you also failed to explain away the trillions of dollars that were actually lost when Trump announced his stupid tariff plan. Do you consider trillions of dollars lost to be a MAGA win? "Owning the Libs"? Making Amaerica Great?

Like most Americans I have 401k (and 403b) through a major investment firm, no money manager involved. And again like many (most?) Americans I have pretty limited choice of investments, mainly a bunch of index funds. Therefore the portion of my portfolio that is in the S&P 500 fund looks exactly like the S&P 500 chart with me taking a massive hit in early April and all the money back in my account by mid May. No benevolent money manager was involved.

When I did have a money manager, he was a good money manager and we reduced risk exposure prior to the y2k crash. For the 2008 crash, I was in the mortgage industry, so I had bailed on banking/builder stocks in mid-2006 in anticipation of the crash. I feel for you if you have a money manager like the one you described, especially since it seems like you sought a money manager with those characteristics. That would go a long way to explain why you're so upset about what happened in April. I would suggest that maybe you need to look at a new money manager, who anticipates when the market is overvalued rather panic selling on bad news.

Again you offered a flawed analysis because the market doesn't operate like your simplified explanation. The S&P 500 was a loser for ~1.5 years after the y2k crash and nearly gave up 1/2 it's value. I'm sure the NASDAQ chart is even worse. Getting back to the S&P, it didn't return to it's previous highs until early 2007 - IOW, if I put $1000 in the S&P 500 in Feb/00 and cashed in ~Feb/07, I wouldn't have made a dime. I hope that demonstrates just how flawed your analysis is.

 

[Jimi77 Premium Member]

So Dems unyielding willingness to fight for every last dime of spending has cost us our AAA bond rating. Thanks Team Blue.

https://www.cnn.com/2025/05/19/investing/stock-market-dow-sell-america-downgrade

 

[Jimi77 Premium Member]

I didn't lose anything. Who lost these "trillions" of dollars because it sure sounds excessive to me.

The lost trillions never really happened. Most people held onto their assets and have recovered all their loses. I do feel bad for those that panicked and dumped their portfolios. The people that really got whacked would be the day traders and hedge fund managers that were on the wrong side of that move, but if you gamble you're going to take some loses. I imagine a ton of margin accounts got wiped out by that move and then a bunch more wiped out by the bounce back.

 

[Jimi77 Premium Member]

So here's a real life example of why tariffs can work. This weekend I went to fire up my evaporative cooler only to find the water pump was dead. This water pump was replaced last summer and only ran for 2-3 months. The pump it replaced was only ~2.5 years old and these pumps are only running ~4 month a year. Online reviews reveal it's pretty common for these pumps to fail after a year. The pumps cost ~$40, maybe $50 if you go to a brick and mortar store so you can get the cooler running ASAP. A US company willing to make a pump that would last say 5-10 years could easily charge me $100 or more saving me trips up on the roof, trips to the store, troubleshooting, time and general PITA and aggravation. Anything but bring jobs back to the US.

 

[RobGMN Premium Member]

Like most Americans I have 401k (and 403b) through a major investment firm, no money manager involved. And again like many (most?) Americans I have pretty limited choice of investments, mainly a bunch of index funds. Therefore the portion of my portfolio that is in the S&P 500 fund looks exactly like the S&P 500 chart with me taking a massive hit in early April and all the money back in my account by mid May. No benevolent money manager was involved.

When I did have a money manager, he was a good money manager and we reduced risk exposure prior to the y2k crash. For the 2008 crash, I was in the mortgage industry, so I had bailed on banking/builder stocks in mid-2006 in anticipation of the crash. I feel for you if you have a money manager like the one you described, especially since it seems like you sought a money manager with those characteristics. That would go a long way to explain why you're so upset about what happened in April. I would suggest that maybe you need to look at a new money manager, who anticipates when the market is overvalued rather panic selling on bad news.

Again you offered a flawed analysis because the market doesn't operate like your simplified explanation. The S&P 500 was a loser for ~1.5 years after the y2k crash and nearly gave up 1/2 it's value. I'm sure the NASDAQ chart is even worse. Getting back to the S&P, it didn't return to it's previous highs until early 2007 - IOW, if I put $1000 in the S&P 500 in Feb/00 and cashed in ~Feb/07, I wouldn't have made a dime. I hope that demonstrates just how flawed your analysis is.

By "money manager", I'm referring to the firms that carry and manage the index funds, mutual funds, IRAs, 401k, 403b, etc, etc.

My analysis is absolutely not "flawed", as it accounts for the reality that when your account value drops, you lose money that would have been generated by interest on the base value.
If your base value is reduced, then you get less interest. It's the simplest of finance equations.

Start with two identical accounts that generate the same interest over time. You plan to hold them for 20 years. On one account, take out 10% of the full amount at ten years. Leave the other account untouched. Do you think they will both have the same value at the end of the 20 years? That somehow the one you took the money out of will just magically recover? It doesn't work that way, and I know for a fact you know this.

I'll let you decompile the math, but here is an example. I'll use 5% interest, since it appears you believe 10% is not achievable. Any money manager that can't get you 5% annually should be flogged.

100K invested for 20 years at 5% annually yields $265,329.00
100K invested for 20 years with a 10% withdraw at the end of year 10 yields $238,976.00

Do you REALLY think that a single-cycle reduction has NO impact on the future value of an interest-bearing account?
A one-time loss of 10% of the account resulted in the loss of over $26,000 by the end. That's real money to most people.

 

[RobGMN Premium Member]

The lost trillions never really happened. Most people held onto their assets and have recovered all their loses. I do feel bad for those that panicked and dumped their portfolios. The people that really got whacked would be the day traders and hedge fund managers that were on the wrong side of that move, but if you gamble you're going to take some loses. I imagine a ton of margin accounts got wiped out by that move and then a bunch more wiped out by the bounce back.

Oh? Then how did the prices on all the stocks involved drop?
The stock market is not a supermarket where they just walk around with a price gun and stamp a new price on thigs. Stock prices drop as they get sold for less than current price.

Again, if you buy the ONLY share that company ABC has for $100, the market price is $100. When you need cash and sell it for $70, the new market price is $70.
Are you saying you didn't lose $30, when you bought high and sold low? I hope not.

If real money did not get lost when the markets fell, people would not be jumping out windows when it happened.
And yes, the ******* rates go up when markets fall, because real money is lost when it happens.

If you invested $10K in Peloton in 2021 (sure seemed like they were a juggernaut), that investment would be worth $384 today.
Please explain how a drop in stock price isn't a loss of money.

"Gamble". Good word. We shouldn't have to worry that our POTUS is going to make an idiotic move that some fraud told him to make. A move that literally knocked the markets down by 10%, at a multi-trillion dollar cost to our country.
Remember when he told us China would pay the import tariffs? Now he's threatening WalMart that THEY should eat the cost of his great tariff plan. Sure sounds like he doesn't know a damn thing about his job.

 

[RobGMN Premium Member]

So here's a real life example of why tariffs can work. This weekend I went to fire up my evaporative cooler only to find the water pump was dead. This water pump was replaced last summer and only ran for 2-3 months. The pump it replaced was only ~2.5 years old and these pumps are only running ~4 month a year. Online reviews reveal it's pretty common for these pumps to fail after a year. The pumps cost ~$40, maybe $50 if you go to a brick and mortar store so you can get the cooler running ASAP. A US company willing to make a pump that would last say 5-10 years could easily charge me $100 or more saving me trips up on the roof, trips to the store, troubleshooting, time and general PITA and aggravation. Anything but bring jobs back to the US.

It's an interesting example, but not a realistic one.
Producing that same product here with the same lifespan it has now alone would jack the price to the $100.

Any company worth its salt will know that if they increase the lifespan of their product by 100-300%, they are going to be selling a lot less, and they will have to price accordingly.

That $50 pump is now $400-500. Is that a good deal for you?

 

[ThxOne Premium Member]

By "money manager", I'm referring to the firms that carry and manage the index funds, mutual funds, IRAs, 401k, 403b, etc, etc.

My analysis is absolutely not "flawed", as it accounts for the reality that when your account value drops, you lose money that would have been generated by interest on the base value.
If your base value is reduced, then you get less interest. It's the simplest of finance equations.

Start with two identical accounts that generate the same interest over time. You plan to hold them for 20 years. On one account, take out 10% of the full amount at ten years. Leave the other account untouched. Do you think they will both have the same value at the end of the 20 years? That somehow the one you took the money out of will just magically recover? It doesn't work that way, and I know for a fact you know this.

I'll let you decompile the math, but here is an example. I'll use 5% interest, since it appears you believe 10% is not achievable. Any money manager that can't get you 5% annually should be flogged.

100K invested for 20 years at 5% annually yields $265,329.00
100K invested for 20 years with a 10% withdraw at the end of year 10 yields $238,976.00

Do you REALLY think that a single-cycle reduction has NO impact on the future value of an interest-bearing account?
A one-time loss of 10% of the account resulted in the loss of over $26,000 by the end. That's real money to most people.

The markets are not set interest bearing accounts like some savings account or CD's. If you want to earn interest reliably then you put your money into one of those type of accounts. Interest earned from the markets is only a potential gain and should not be counted on. The market is up and down all the time so to rely on interest from the markets is not a smart move.

From your post above you are, the left is, upset over money lost that never existed in reality but only in potential. Again, that is nobody's fault but the investors. Want to make money then invest more safely.

 

[Jimi77 Premium Member]

It's an interesting example, but not a realistic one.
Producing that same product here with the same lifespan it has now alone would jack the price to the $100.

Any company worth its salt will know that if they increase the lifespan of their product by 100-300%, they are going to be selling a lot less, and they will have to price accordingly.

That $50 pump is now $400-500. Is that a good deal for you?

Or... get this, instead of ripping customers off and/or producing an endless pile of products that are bound for the landfill, maybe this could be an opportunity for an honest business person to make a good product and sell it at a fair price. My previous swamp coolers had motors that lasted "forever" and those companies were able to make a profit.

 

[Jimi77 Premium Member]

The markets are not set interest bearing accounts like some savings account or CD's. If you want to earn interest reliably then you put your money into one of those type of accounts. Interest earned from the markets is only a potential gain and should not be counted on. The market is up and down all the time so to rely on interest from the markets is not a smart move.

From your post above you are, the left is, upset over money lost that never existed in reality but only in potential. Again, that is nobody's fault but the investors. Want to make money then invest more safely.

Actually if you want to make more more money, you invest more riskily. It appears that there is a group of people that wanted the upside of the higher returns you get with increased risk, but not the downside when it happened. And then when the market quickly recovered, they still want to complain about a loss they never really experienced.

 

[Jimi77 Premium Member]

I bet this aggravates Team Blue.

https://www.bloomberg.com/news/articles/2025-05-13/musk-strikes-starlink-deal-with-saudi-arabia-during-trump-visit

 

[RobGMN Premium Member]

Or... get this, instead of ripping customers off and/or producing an endless pile of products that are bound for the landfill, maybe this could be an opportunity for an honest business person to make a good product and sell it at a fair price. My previous swamp coolers had motors that lasted "forever" and those companies were able to make a profit.

Gotcha. It's a huge opportunity. But for some reason no one seems to be taking the opportunity. In fact, pretty much every corporation ever has moved AWAY from that opportunity over time. Why?

I'm not sure where "honesty" and "business profit" are intertwined, but let me ask this question: How realistic do you think it is to ask someone to start a business so that they can make enough money to cover costs, put food on the table, a roof over their heads, and that's it? Just an "honest days work".

At one point I suggested that in order for the right to get what they want, people like Musk, Bezos, etc, would have to be required to cap their income. Maybe at a level that is more than enough for multiple lifetimes. Basically, your idea of an "honest person selling a good at a fair price".
I was vilified for even suggesting it.

Yet here you are, suggesting pretty much the same thing.

And here is a tangent: The US is "upset" that China sells us goods for cheaper than other countries do, and cheaper than we can make it ourselves.
Does the US get "upset" when WE sell goods to other countries for cheaper than they can make them, or cheaper than they could get them elsewhere? What about goods that we have and no one else does?
66% of Coca Cola sales are international. That seems terribly unfair. Why don't they release the recipe to other countries, so they can make their own, instead of having to buy from Coke?

Are we basically upset that we are not the absolute king of the hill in the economy of the world?
NO ONE should outdo us, EVER?

 

[RobGMN Premium Member]

The markets are not set interest bearing accounts like some savings account or CD's. If you want to earn interest reliably then you put your money into one of those type of accounts. Interest earned from the markets is only a potential gain and should not be counted on. The market is up and down all the time so to rely on interest from the markets is not a smart move.

From your post above you are, the left is, upset over money lost that never existed in reality but only in potential. Again, that is nobody's fault but the investors. Want to make money then invest more safely.

You're totally disregarding the point that the orange idiot directly caused a major and very expensive drop in the the markets, costing TRILLIONS of dollars.

Your lack of investments does not mean that the markets and their values are not "real". People pay REAL money to buy stocks, and they lose REAL money when those stocks drop in value.

To give you a perspective you might understand: You buy a house for $75K to fix up and flip. You contract it to sell for $125K, closing once the work is done.
You do the work for $25K.
Someone gets pissed at you and burns the house down. The insurance only covers your purchase price.
But it's all good because the profit you would have made wasn't real yet, and the $25k was simply a risk you took.
Right?