LiLy2021 wrote: Thank you, ladies and gentlemen, for your priceless contribution. I always strive to gain wisdom through peoples' life experiences. I'm being offered these invaluable lessons for free. I also supplement my knowledge from textbooks, but they're very different from life experiences. I mean, I never had to solve another differential equation after I left school. :-)
I have never lived through any crash in my life, except for the one in March of 2020. But the market recovered so quickly that it stupefied even the most veteran financial experts. I didn't flinch because I believed that with all the enormous amount of money printing going on around the world, real assets (real estate, good companies or the stock market in general) will be further inflated. Unfortunately, not many people had cash sitting on the sidelines for this incredible opportunity because they were busy answering margin calls, Obscure.
I also disagree with Experienced about the market taking because you said 45% of people are totally tapped out. They don't pay taxes because there's no income and that they live paycheque to paycheque. They'll need to cut back on spending as inflation rises and that'll hurt the stock market. These people will always do well. The government will make sure that they're taken care off. They'll only print more money to hand them out. Sometimes I think that to live well in this country, you need to be very rich or very poor. The very rich people will have their money taking care of them, and the poor will have the government by their side.
Fear and greed are our strongest emotions, but we are frequently faced with both for being in the market. Many times I just make my decisions based on my intuition when I have to stand in a crossroad. I cannot sit on the sidelines with cash hoping for a correction that might never come while seeing my money being eroded by this ferocious inflation. I also do not think there will ever be crash of the magnitude witnessed in March 2020. If there will ever be one, the government will immediately step in and prop it up.
I can't beat them so I need to join them. The Dow as well as other indices will March higher. The Dow will surpass 40,000 by year's end, if not sooner.
@MigraineCall: I totally agree with you about the hassle of being a landlord. Equities is the way to go when real estate is at this eye-popping valuation. I don't know where or when you bought your property but sometimes it's just a matter of luck and right timing. I loaded up on real estate in Toronto at the right time. Properties I bought for $450-$500k are all selling for North of 1.6 millions. Tenants have also paid off the majority of the mortgage. I only need to pay 10% of the rental income to a property management company and they assume all these hassles for me. Congratulations on your dream life!