I have sold off all of my investments

Hightor,

There are two ways to look at the stock market.

1) A long term investment for retirement
2) A short term vehicle for "gambling" (i.e. you play the system for short term profit).

We should clarify what we are talking about. I am very deliberately talking about the former. When invest in the stock market for the long term, we are talking in terms of 10 or 20 years. When I talk to my financial adviser, that is the timeframe (I am at the age where I am slowly decreasing my stock portfolio and moving to lower risk investments).

The terms you are using are for day traders or other people looking for short term gain.

On another note, I am curious about which economists you are listening to. Can you provide a link.

What I'm saying is that your "two ways" of looking at the stock market may have been subsumed by unprecedented conditions, and the sort of growth investors previously expected to see over the long term may not be enough to replace the wealth lost in this economic downturn. Our aging workforce, the disruption of global supply chains, the already-existing stratospheric levels of debt, and the amount of "wealth" simply generated by financial engineering, all make chances for full recovery slim, especially with the replacement of workers with technology and the likelihood that climate change will need to be addressed more directly in the ten to twenty year time period you are talking about.

People were making the exact same dire predictions after 9/11, and after the crisis of 2008.

In both cases peoples fears that "conditions, and the sort of growth investors previously expected to see over the long term may not be enough to replace the wealth lost in this economic downturn. Our aging workforce, the disruption of global supply chains, the already-existing stratospheric levels of debt, and the amount of "wealth" simply generated by financial engineering, all make chances for full recovery slim".

In both cases these predictions were wrong.

They couldn't have been "the exact same dire predictions" because the events aren't exactly the same — a terrorist attack leading to military action, a housing bubble, and a global pandemic. The only similarity is that the all generate uncertainty — different kinds of uncertainty.



And both of those cases were very different, from each other, and from what we see today. I'm not making a prediction, just pointing out that this isn't the usual "downturn in the business cycle" that investors have learned to live with.

When I read the economic experts, they all say there will be a deep recession followed by a recovery. Most economists are point to the economic strength that existed before the current crisis.

I have seen real economists predict that the recovery would happen at the end of 2020. Others predict the recession will continue to the end of 2021. I don't see a single reputable economist predicting a collapse of the economy that will last past 2021.

Understanding the following:

- In times of crisis, people exaggerate risk.
- There is a psychological need of people in crisis to "do something" even when the best action is to do nothing.
- The Dunning-Kruger effect means that people will trust their own instinct rather than listening to the people with true expertise.

What would it take for you to accept the analysis of the experts? It seems to be a fairly strong consensus. Can you provide a link to an reputable economist who suggests this will last beyond the end of 2021?

There are no experts in economics. Economics is not science. It's an art. That's the reason economists always have difference of opinion on different issues facing this subject. https://www.theguardian.com/commentisfree/2015/oct/11/nobel-prize-economics-not-science-hubris-disaster I studied Economics, Macroeconomics and Microeconomics in college. I'm not an expert; just a student of the subject.

When we look back at their analyses from a vantage point in the future, maybe as early as 2022, we'll have a better idea. We don't have to accept or reject the predictions of economists; we can withhold judgment at this time and see how their ideas have held up at a later date when we actually have more than speculation and wishful thinking to rely on.

No truer words said thus far. The DOW already wiped out three years of gains, and it's probably just the beginning of the slide. That's because the world's economy is in distress. The coronavirus presents a whole new picture into the world's economies. Some pundits are already predicting how long this will last, but they're all guesses without any basis of fact nor confidence. Some are saying two years, and I'm not sure how they arrived at that number.

Nonsense. Of course there are experts in economics! Someone who spent 12 years of their life studying to get a PhD in economics is an expert. I have taken a couple of classes on economics. I am not an expert.

I don't know what you mean by "studied economics in college". If you have a advanced degree in economics, then you can call yourself an expert. If you have taken a couple of courses, you can't.

The experts ( people who know most about economics are predicting the recession will end by either 2020, or 2021 at the latest. I would love to see a link to a reputable economist who is predicting otherwise

Being an expert doesn't make someone infallible. It does mean that they have done their homework. That they have spent years learning so they actually know what they are talking about. Economics might not be a science, but it is about mathematics, and data, and measurements and models that can be tested.

If you can't admit that there are people who know more than you, then you are stuck with your own level of knowledge. When you do this you are far more likely to make a mistake.

The experts are saying to stay put in investments. The experts are saying that the recession will be deep, but that there will be a recovery by the end of 2021. These are not infallible prophecies... but they are the best understanding of the people who actually know what they are talking about.

By not listening to the experts, you are left with human impulse and fear. Particularly in times of crisis, this is a bad way to manage your finances.

(If I am wrong about what the experts are saying, I would appreciate a link to a reputable economist saying otherwise.)

I don't know why I am arguing on this thread. I am hurting myself. I am (as experts are suggesting) continuing to put money into the market as part of a sensible balanced long term retirement plan.

The more the rest of you freak out and act impulsively in the short term, the better deals I will get that will pay off in the long term.

"This Crisis Will Spill Over and Result in a Disaster"

That's good. You found a link from the economist nick named "Dr. Doom".

I will give you that one. He is an outlier.

He's a respected economist, with a decent track record. Of course people were going to stick a dumb nickname on him. Which economist do you listen to — Dr. Pangloss? If you're just going to dismiss any economic forecast you don't like, why bother to read economists at all? Just continue with your twenty year investment strategy; that's all you we're going to do anyway.

https://www.investopedia.com/articles/economics/09/why-economists-do-not-agree.asp

- https://www.aubreydaniels.com/blog/economics-not-science

Nobody was able to predict the impact of the coronavirus on the world's economies.

I am saying that you should listen to the experts. They don't know everything, but they know more than you do. Getting solid financial advice from a financial advisor is an intelligent thing to do before making a drastic decision.

What is the problem with that?

The same arguments you are making about financial decisions can also be made against doctors, lawyers and mental health professionals. Do you object to me suggesting that someone should talk to a doctor (about medical questions) or lawyers (about legal questions)?

From your economics courses, can't you see how selling your retirement fund after a big drop in the market might be damaging to long term investment goals?

I don't exactly know what you are arguing Cicerone, or with whom you are arguing. I have never said that economics is a science, nor have I ever said their aren't branches of economic thought.

All I said is that someone with a PhD in economics, who has spent years studying and working in the field has a level of expertise that I don't have.

Do you really disagree with this point? This seems to be another anti-education argument.

Doctors don't know everything and are sometimes wrong. But if I have a medical decision to make, I am going to go talk to a someone who has gone to medical school, earned an MD and has experience in the field... and although he isn't infallible, I am going to listen to his advice over my own impulses. That is my best chance to make a good decision based on all of the information. Finances/economics are the same.

Expertise matters.

Economics is a behavioral science.

This is precisely my "long term investment goals." I now have cash in the bank. The current actions by the government to boost the stock market is not the correct tactic in this environment. It's a world economic crisis with no grasp of how long and how deep this problem is going to last. Can you please name these experts? I'm not suggested anything for others whether it's about economics, investments or healthcare. I have only shared what I have personally done, and my opinions for them. As I have reported earlier, my wife is keeping her investments.