2018 Market Predictions
What are everyone's thoughts on the stock market for 2018?
Hopefully everyone enjoyed the success of 2017, and I don't have anything concrete to go on, but part of me is thinking we can't keep climbing forever. It's been almost 10 years since the last big correction, so are we due for another one soon (or already overdue)?
I'm thinking of some minor adjustments to my strategy - maybe keeping more cash on hand instead of investing it immediately (to jump on lower prices should they fall). Not planning on anything aggressive like selling off any investments that I already own (unless someone can convince me otherwise!)
So what do you other brilliant minds see ahead? Gains, losses, or flat market?
(PS - Try to keep things in somewhat layman's terms but also avoid childish things like "Trump rocks/sucks and is going to rally/kill the market!")
Mark Mc. My honest feeling is that the market has become overheated and is already overdue for a fairly significant correction. I do believe there are more gains ahead in the short term but I'd be surprised if we make it through 2018 without seeing some bleeding.
It really depends on your age...if you are young enough to weather the corrections (or even a recession?) then I'd stay put in the market...there's time to regain any losses. I am young enough to do just that, and my view is fairly traditional...buy low, buy high, buy all the time. Dollar cost averaging is so much better than trying to time the markets.
if you are older and will rely on your investments in the not-too-distant future for living on, then I'd be extremely cautious at these levels. But if you are that age, you shouldn't be so heavily weighted in stocks anyway.
I'd just focus on buying companies that are solid and clearly cater to the future ....Apple, Amazon, Netflix, no one can best these at doing what they do. They are changing the game and writing the rules and totally unafraid to do so. Everywhere I go I see people's recycling at the curb...what do you see? Amazon boxes. Walk around a college campus in a student center....what do you see? Apple laptops everywhere. Iphones everywhere. Comcast cord cutters? They're still watching TV...probably Netflix and Amazon.
And don't forget American's love affair with the simple cheap and convenient hamburger. McDonald's is always a good bet, ESPECIALLY in a recession.
eperot Personally I see a major if not a significant correction coming.I see a lot of volatility in this world right now that could be very tough on the markets... I personally am gonna be a little more conservative this year.. Gonna keep cash handy and if I see some buys that I like I might pull the trigger..
Mr. Tone They've been saying for years there is a correction coming- but year after year the gains keep on coming. This year was bonkers high returns!!
Smart people just buy as much as they can of the S&P index as often as they can. If the market goes down- keep buying. If you can afford to do so- buy more on the dip.
That being said- my USAA Nasdaq index beat my VG S&P this year by a healthy amount. Over 33% gain from last year.
My play money long term gamble? Atari.
They have a LOT of projects in the works globally- in many different areas. I call them a startup with a legacy. They are dirt cheap to buy into- and have name recognition.
I know all the naysayer stuff- not the same company, bankrupt about 5 years ago, but I just look at the #'s.
They are on a turnaround and the #'s keep improving year after year. They have a lot of interesting stuff going on right now- TV show overseas, lots of products- heck they are now working on blockchain technology platform and a crypto- currency called "Atari Token".
Also in their latest investor papers a week or so ago- Atari revenue growth +43% for the first half of this fiscal year.
I may be wrong and loose all the money I am rolling the dice on with them- but I don't think so. :)
Josh The problem will come in the Bond Market - too much debt. Bond Market is much much larger than the Stock Market.
Bond vigilante
https://en.wikipedia.org/wiki/Bond_vigilante
ru 
happiest girlMillionaires are in the Stock Market - Billionaires are in the Bond Market.
as they say.
I hope it happens soon... I've been sitting on about $15k to open 529s for each kid and I've been worried that the bottom was going to fall out right after I opened them. So the $ is still sitting in a savings account accruing 0.08% interest, lol.
ianimal My Vangard Total International Stock Index Fund beat the S&P 500 last year. 27.55% return. I have about 20% in International. Curious how much others are allocating US vs. International.
gm mom I have one IRA with 20% going to international. That’s about 6% of my total investment/retirement portfolio. If you add some of the other target date funds I own, I’d say that maybe 8-10% would be my international ball park.
Iman. I like CHET but that was years ago. Just put it in. Your minianimals are too young to worry about timing.
Strangerdanger I said 2 weeks ago- "My play money long term gamble? Atari. "
They are up 8% since then.
40% for the last 3 months
135% for the last year.
The next 6 months should be very interesting as they release end of year #'s, news on projects they are currently involved in.
I've been watching investing forums and news sites in France (google translate is funny)...and people are starting to take notice of the stock.
If you are in your 20's or 30's, do what we did. Buy good companies, such as Exxon, Walmart, Pfzier, and reinvest the dividends. We started in 1987 and we are still reinvesting them. Started with 90 shares of Exxon and now we have 1525 shares. Hoping for a stock split soon. Good luck to everyone!!!
Mansfield mama These days for the vast majority of people a low cost index fund is the way to go.
Yes- reinvested, and contribute as often as possible.
Putting actual retirement money into individual stocks is a huge gamble and seldom worth it.
Play money is a different matter.
Market is kind of "toppy"
If not in, be a patient spectator.
If need to get in.
Look at utilities with a comfortable dividend. Reinvest it (drip)- dividend reinvestment program.
Add judicially.
Wealth accumulation, like life, is a marathon not a sprint.
JMHO
Stymie Mama, you are right except for Exxon is going nowhere today or tomorrow. Renewables, solar, is cheaper and cleaner. Global warming is real. The storage problem of electric will be resolved soon.
iJay iJay, good point. Exxon still works for me. I had the stock certificate from Standard Oil when I got the stock in 1967. Wish I had reinvested my dividends then.
iJay,
Talk like that is going to get you hurt. Take the blue pill.
"Global warming is real."
Dodgeball is it true that people who buy stocks in pot manufactures will be flying hi with profit and thus it being taxable will the state profit ( remembet to not to bogart that joint my friends)
Caged Animal Who better to trust for predictions and advice that some anonymous poster name strangerdanger.
First rule of advice: anything I say can be wrong. I have erred many times and I have sinned upon occasion :>)
Second rule: wherever we are in the economy, we have never been there before. The past might be a guidepost, but never a map. Don't ever believe you, or anyone else for that matter, really knows what's going on.
Third rule: You can never be number one or even win in the stock market; they are better, stronger, and faster than you. They get the info sooner, can trade before you, and can manipulate markets upon occasion. You can do better than most, you can live well off the scraps, but you can never win. As in if you are doing this to tell people how good you are, you have already lost.
Fourth rule: it's all about risk and reward; my major risk is whether I can sleep at night or do I have to check my balance every ten minutes. I, myself, can't live that way, too fidgety.
Fifth rule: construct some rules for buying and selling; without them you really don't have a metric for your decision model. This is important if you plan to keep doing it.
Sixth rule: if you hear about it here, read it in the newspaper, get a whiff of it from your cabbie ------ it's too late to buy. Remember rule number 3
That said, and prioritizing rule one, much of what is said above in the other posts about what to buy and how to look at it, I agree with, as well as, diversity rules and variety is the spice of life. I have followed almost every strategy noted above, relying on a few, but deploying most at one time or another. The question is timing
In 2008, I was heavily in CDs, a lucky move given the future, but I was no predictor. In 2009, I had less CDs, no managed funds, just buying and selling, literally as a day trader. Did the same in 2015. In between, many managed funds, indexes, and blends. Why not pick on the big picture an let smarter people make the little choices.
The key in all this is to have some discipline, have some rules, have some metrics. They can't be what I use, it's personal. Why is that? Because even with all the information, all the models, whatever --- in the end it's a gut decision. And you have to live with your gut, I can't.
To do this with a modicum of success you have to know why you buy, why you sell, and measure those reasons against the results, the why's. Then you can modify to get better. So develop some rules, try em, measure em and decide what to do next.
Next I'll get more specific with my pick strategies but most really at already listed above.
Mama, look at Shell. They are probably the big oil leader in getting into wind farms. At their heart they are energy companies. But not all energy companies will survive, or more importantly prosper, during the transition.
Dodgeball, stay in your own little cocoon and believe that wood stove isn't doing anything. It is the cumulative effect, not a car or two, a coal plant or two.
Final fact, besides what the media may have you think, China is ahead of us on a renewable track.
Things I buy:
I get a nice portfolio of blue chip with dividends, usually 4% or higher for bread n butter returns. Pretty safe, can usually weather all downturns and continue to pay the same dividends (although % changes as stock price changes).
Reinvest or drips: I do these often if planning to hold long term but if I am buying to sell I do not. It makes it harder to know your investment when you drip, you have to count every deposit, and when I buy to sell, I want to know profit/loss ASAP and cleanly. Just easier not to drip and there's always somewhere else to put the drip.
CDs: yeah, I still have em and today's 2.65% is getting there. When it crosses 3%, I will be converting more assets into CD's, again, bread and butter money. When it crosses 5%, I will be putting lots more in. FYI --- I go for 5-years, fixed, figuring I can always terminate early and hit breakeven fast for a point or more increase. Both Roth and Traditional, but mostly Traditional --- think because of my age, but can't remember
Mutuals: in the early days, never. After 2012, when the market started getting hotter but unpredictable, I started into mutual. A lot of Retirement Funds, Bond Funds (not right now though), etc.
Indexes: I tend to these now instead of stock searching. Again, easier, and lower risk. Just did one on Medical Appliances and General Defense just before the vote. Worked well.
Stocks: You name it, I have bought it. Bought cigarettes on the downturn because the business managers were good. Bought guns n ammo at Obama election because he scares them. Got Under Armor cuz I liked the name, no one knew it, and clothes tend to be like a flash in the pan --- so I sold on the flash. I buy less individual stocks now and usually on impulse.
One market that does not look as good anymore is solar. Trump just whacked solar imports from China with a 30% tariff basically trading our solar industry for his politics. He is single handedly killing our one energy mega-growth industry that uses 100% Americans for install for a few factory jobs.
Think about it: our solar industry is going gangbuster and consists of all Americans installing Chinese panels. https://sciencealert.com/one-chart-shows-how-solar-energy-growth-is-skyrocketing-compared-to-predictions
With the tariff, these Americans will be working less, period.
Last year I suggested that young people studying up should look to the solar industry for what might be a lifetime career in a high-paying growth industry that might have 40 years or more before the growth stops. Now I say, not until November when we see if we can start ending this craziness.
Even if Americans decide to pick up the panel manufacturing slack, think about it: end-users will pay a minimum of the new Chinese panel tariffed price less 30% or less, which will still be higher, probably a lot higher, than they are paying today. So end result is still less solar installs due to rising costs.
Who benefits:
Americans looking to put solar in? No.
American solar manufacturers? Not really, with less than 20% market share, they can't pick up the slack. There's only two of them.
American energy manufacturers? Sure, slowing solar advantages big oil, big gas, bottom lines. These are the guys pushing for the tariffs, go figure. Breathe deep, while you sleep, breathe deep.
Meanwhile, the real effect will be whack-a-mole as Chinese plants move to other third-world countries outside the tariff. Still, the disruptive effect could tank the industry as it's reputation for market stability gets shattered so Trump can make a political statement for the bo-hunks dreaming of glitzy manufacturing jobs that will never happen and really for Trump to cover his oil and gas billionaire buddies.
Or they can ask those still out-of-work coal miners --- Oh wait, they're all working, remember, no unemployment..... Turns out, Trump lied: http://www.politifact.com/truth-o-meter/statements/2017/jun/05/scott-pruitt/are-coal-mining-jobs-50000-last-year-not-exactly/
I read that countries and central banks simply stopped buying or dumped U.S. Treasury Bonds. These would be countries; such as, Russia, China, Tawain, etc. This seemed to cause people to think there would be a "Bubble" in Treasury Bonds, making long-term investments risky.
Those countries seem to be to my understanding, simply trading their own currencies in bi-lateral deals with one another and had less need for Treasury Bonds. I'd guess these countries would be maintaining the bare minimum in liquid assets in those bonds as a safety net. This might have something to do with China's and Russia's desires to bypass imposed Sanctions.
As for central banks, or more precicesly the I.M.F. there seems to be a desire to change the current system by some. China; for example, seems to want change the system to use the I.M.F's Special Drawing Rights. These SDRs are really popular in developing countries. The only problem being developed countries have little need for it.
I also read that Central Banks are interested in changes to their systems involving the use of digital currencies, controlled by a distributed ledger system. There could be big changes as early 2018 in that regards.
With all the superficial thoughts and opinions in those paragraphs, I think there are a few good indicators to watch for in the future in regards to stock-market changes as follows:
1. The stock-piling of gold you see now, is likely countries preparing for a perceived coming fiat currency death or change in how the system works.
2. Central Banks are interested in making a digital currency controlled by distributed ledgers. All the bit-coins you see now seem to be "experiments" to me anyway.
3. Electricity use is massive due to the mining done by bitcoin like operations. Free solar panels for the seems nice.
4. Technology will boom because it is a luxury of developed countries, just like the stock-market is a luxury.
5. Monetary Policy is the primary driving force for the stock-market by a vast majority of influence.
Well those weren't much of an indicator for much. Just opinions based on opinions of read articles.
Nobody What a bunch of unsupported bogus allegations Nobody....
You got to be able to source better than these musings.
It all ends in bitcoin, is that your answer?
Are you Russian?
SD, in the long run Solar and Wind tied to distributed storage solutions will be the answer. Fuel cells and batteries will handle the storage issue, over time. Technology will continue to prosper as it pushes better ways to do things, i.e. simpler.
Not with a 30% tarriff on panels from China.
The last solar crash was 2008 when Euro govt funding and incentives dried up. Killed fledgling industry overmight and wiped my stocks out. Took till like 2014 to start showing life after obama started funding.
The tarriffs could send the industry back to 2008 again.
Breathe deep whike you sleep. We’re in coal country now.
So, the DJIA is down about 2,000 points since Thursday. How much further will she slide?
My thought was the tax plan was going to squeeze a little more run out of the market, at least until Fall, especially if we made it until Summer. We'll see what happens.
MeisterNJ Shoot; this is just a message. Not even a correction yet.
Fall? You gonna need banner business to balance 1q deficits that will hit due to a loss of tax revenues.
To the white guy in a suit who says don't do anything, we don't listen to ya so good since that 2008 thing
maja2 Pushing the weak hands out before a new leg up.
Whatever the Bond Market does will indicate where the stock market is going.
It's all high frequency algorithm trading- very few actual real people trade stocks anymore.
As for supposed lost tax revenues - irrelevant at this point. The way the Fed's print money these days - federal tax review doesn't matter anymore. They could collect no tax money and the federal government would continue to operate - its all rigged.
imo
Good political talking point though.
Hey, when you disregard the facts on lieu of your “rigged” conspiracy, everything you believe is true. Your statements just dont ring true.
When did they last print money “these days?”
Do I hear jeopardy music?
In all of this, heard a funny.....
A certain someone was heard to say: "Dow Jones, Dow Jones, I don't know no Dow Jones, never met Mr. Jones. Someone said he was a low level staffer in my campaign......"
Right, because adding key presses to a computer ledger isn't the same as physically printing money. Correct you are.
But that wasn't the point, was it?
Justintime Atari is up another 16.28% this morning as I type.
That is on top of over 15% gains yesterday, +5% on Friday, etc.
https://www.investing.com/equities/atari-technical
and it's still a strong buy - whats the driver there since december?
skippy Anyone care to share their sentiments regarding the stock market, these days? Is the “Midas touch” working? Old fashioned fundamentals? If this recent crash was due to higher interest rates or coming tariffs, I would venture to guess that the crash isn’t through with us, yet.
Guilty-Remnant DJIA down another 550 points to close lower than the 2018 open... and there's still more losses to come, methinks.
I don't care about points, I care about percentage. 500 points back in 1987 Black Monday was 20% and that was a big drop!
https://investornews.vanguard/volatility-strikes-back/
https://hbx.hbs.edu/blog/post/why-is-october-the-stock-markets-most-volatile-month
October is historically a volatile month, so for advisors this was expected.
Jim L Commenting is no longer available.