My well-diversified 401(k) has declined 4.2% in the last 2 weeks.

[KyuzoGator]

Those tax cuts sure stimulated something.

[racaulk]

1. Those tax cuts have stimulated economic growth!

But only if you're in the upper economic echelons of our society. Chances are you're among the 99.9% that are being screwed by *'s economic policies, and I'm right there with you. My 401(k) hasn't decreased in value dramatically (yet), but it sure isn't earning anything! If it weren't for my employer's matching portion, I may as well just put my money in a savings account at the bank.

[havocmom]

2. And the market would be such a good place for Social Security $$

Good for brokers anyway

Look for more spin & talking points on privatizing Social Security again. Wall Street in need of another fix.

[democrat_patriot]

3. My stocks are down, but bonds are up.

I'm not retiriring for a while, so I'd like to market while I buy for the next 30 years...

[survivor999]

16. Bonds up?

Mine are down 1.5% YTD... TIAA-CREF Inflation-linked bonds...

[democrat_patriot]

29. Well, only up 1.66% over last 12 months.

Factor in inflation and I'm losing $$

[Virginia Dare]

4. There's a bad moon on the rise...

check this out:

Are Dick Cheney's Money Managers Betting on Bad News?
A look at the President and Vice President's financial disclosure forms.
By Steven Goldberg
May 17, 2006


Vice President Cheney's financial advisers are apparently betting on a rise in inflation and interest rates and on a decline in the value of the dollar against foreign currencies. That's the conclusion we draw after scouring the financial disclosure form released by Cheney this week.



http://www.kiplinger.com/personalfinance/features/archives/2006/05/president.html

[catmother]

5. i pulled all of our 401k money out of stocks a few years ago. i

held onto IBM for awhile, but got rid of that too. everything is now in fixed income. my husband is 58 -- too close to retirement to play the stock market. we're making over $16,000 a year in interest. i'd rather earn less and know that my money is safe.

i was listening to a financial guy on the radio a few weeks ago and he said "he was ahead of the house" so he was going to take his profits and put it into something more secure.

[KyuzoGator]

6. I think the "something more secure" for me will be real estate.

Or emerging markets funds.

[Sammy Pepys]

8. No way....

Real estate? Now?

Emerging markets have had a huge run-up in the past couple of years.

[catmother]

15. i don't know about your area. but right now in phoenix real

estate prices are inflated. i bought our 2-1/2 acres in 96 for $48,000. now 1 acre is going for $340,000. houses are starting to sit for a long time and some are reducing their prices. i know i wouldn't invest in real estate here. however, i wish i would have bought more in 96. we would have done into debt, but in the long run we would have made money.

[Sammy Pepys]

7. Yup....

Although if you've got some a fair amount of time before you retire (15 years +) it's not worth worrying about. Just keep contributing and getting the company match if you have one.

[KyuzoGator]

9. Indeed, stock risk resembles bond risk over a 10+ year timeline.

I'm young and will ride this thing out just fine.

[Sammy Pepys]

40. You and me both...

Hell, I'm topping off my Roth at the end of this month. I was on schedule for a November top-off, but I've got the cash so I'm going to fill 'er up. Then I can just put the funds I was putting away every month back into my cash accounts.

[coalition_unwilling]

10. Diversify and periodically re-balance also. n/t

[Avalux]

11. I think I'd be better off putting my money under my mattress.

x(

[KyuzoGator]

12. Have you looked at inflation?

I'd buy gold before holding cash.

[question everything]

13. Hang on. Those 401K are long term investments

The market dropped 3.6% in the last week alone. If you contrite regularly, you may be able to grab a bargain these days.

I read that the association of realtors have been screaming at Bernacke that the continuation of the increase of interest rate is killing their industry..

And just think of the millions and billions that the real wealthy have lost in the same two weeks..

[deaniac21]

26. Look at this long term chart.

[WestSeattle2]

37. Boy, you sure got screwed if you retired in 1965.....

the market was stagnant for the next 15-18 years! Have those pushing for the "privatization" of social security, made any suggestions on how they would handle a similar period in time? I sure haven't heard any.

[deaniac21]

39. My advise to you would be to stay away from 401k

contributions.

[MazeRat7]

14. Thats a good fund - if its down 4.2% consider yourself lucky....

Some indexes are down as much as 20%. While I don't do funds, I do know that the last weeks have been some of the worst in the past several years. Personally I'm off just under 20% and I have a very well balanced portfolio.

Bottom line, don't panic. This downturn is all about global interest rates and the move toward liquidity. Speculation dollars are drying up, consumer and financial sectors are taking a hit.

Things will be better by Q3.

MZr7

[redherring]

17. Congrats. You're doing better than most people

I am down almost 15%.

[4_TN_TITANS]

19. Me too.... down about 15% but still positive.

and that's exclusively foreign funds

[mnhtnbb]

18. I think you're going to see a wild ride for the next 6 months

I'd been nervous for some time about our exposure to equities. When the market started it's downturn in mid-May, I sold all my individual equities, but kept my mutual funds (which historically had a good track record of holding value in downturns). I'm now 50% cash, 25% mutual funds (some international), 25% bond funds. I'm thinking of putting 1/2 of the cash in 3 mo CD's which will generate interest about double what you get in money market. My husband is out of the market entirely--he's in TIPS.

I also just bought into a Technology sector fund today (it's off 14% since mid-May and I thought that made it a good buy). I consider this money long-term.

[survivor999]

20. So, when you consider

that you pay taxes on the interest made by putting cash into CDs, is that still a good deal? I think so... For example, ingdirect.com is now up to 5% for 9 month CDs... 4.75% for 6 months... I have a big chunk in there, but it's painful to have to pay taxes on the interest you make...

[mnhtnbb]

21. I was paying taxes on dividends of individual equities

since most of my holdings were dividend-payers.

Plus, raising cash will allow me to shop for bargains, I hope!

[catmother]

24. AmTrust bank is paying 4.75% on 6 months. i have 2 CD's with

them. when i did the first CD back in april it was 3.85%. in 6 months it went to 4.75% (i renewed in cotober). i won't do more than 6 months because i'm hoping they'll go up more. also have a checking account with them that pays 3% interest. we keep some money in that one in case of an emergency.

[survivor999]

27. 3% ? Not bad...

I'm not affiliated with ingdirect.com, but they give 4.25% on savings, and there is no minimum. you can take money out whenever you want. Also, of course, FDIC-insured. Used them for 3 years now and I've been pretty happy.

[catmother]

28. you have to have a minimum of $10,000. it's called titanium

checking. they have another one that pays 4.75% on $50,000. i've been dealing with them for about 4 years now and they always seem to have the best rates.

[RagAss]

22. Buy Buy Buy....

seriously...these asshats aren't going to be running this country forever(unless they kill us all, in which case you won't need a 401k)...think about it..if you bought when Bushloser the first was in power then by the time Clinton was in year 7 of his Presidency, you would have made out like a bandit...it will happen again...buy as they drop...

[catmother]

25. we did well on stocks during the clinton years. IBM stock went

from $45 a share to $236 a share, then split. now it's down to $77.00

[leveymg]

23. Psst. Go short on REITS. Buy FOREX futures

This is all about imploding real estate markets and an imminent decline in the Dollar.

If your well-diversified stock portfolio is hurting you, make a play into reverse index funds that will go up as housing and real estate values decline. Go short on Real Estate Investment Trusts, REITs and buy puts on the Dollar, which is almost surely going down versus the Euro and other foreign currencies (FOREX).

[Crabby Appleton]

30. My foreign stock fund (in 401k) is down

about 15% in the same period.

[newyawker99]

38. Hi Crabby Appleton!!

Welcome to DU!! :toast:

[stepnw1f]

31. Now Imagine if They Privatized Social Security?

Just imagine the gambling there.

[Geek_Girl]

32. I have my 401k in Canadian stocks

It was doing really well this year but the last couple of weeks have been horrible. It dropped by about 7%. It has to do with the rising interest rates and oil prices.

[davekriss]

33. I'm down 7.5% from the most recent high (eom)

[berni_mccoy]

34. The Bush admin is only interested in the performance of two Industries:

Oil and Defense.

Anything else, Fuhgeddaboutit!

(look at the graph in my sig)

[B Calm]

35. Regardless what the neo cons tell you, it's been a bad quarter!

I lost thousands of dollars...

[OffWithTheirHeads]

36. I am certainly no expert but....

As worldwide competition for construction materials continues to increase (ie: China) construction materials are going through the roof! Look at what copper has done in the last 365 days! I know commodities are scary for a lot of people, but, being in the construction industry, I see the effects of global demand every time I buy material. As third world countries develop, this will only continue to stress supply of limited resources. Might as well profit from scarce supply. You don't need Gold or platnium to build a house but copper, concrete, steel and wood are essential and not unlimited. Just sayin!