Demographics and rising stock markets?

[Abitibidoug]

After following this site for some time I have noticed two ideas recurring:
1) The stock market is going to crash again.
2) The baby boomers haven't saved much for retirement, and are going to spend less and save more in the present and future.

If the second idea is true, and some of that savings goes into stocks directly or through equity funds, won't that continue to put upward pressure on stock prices? Could that be the reason stocks have been going up even when there is still a lot of trouble in the economy and a full recovery is many years away?

[jamesy437]

If you're a baby-boomer who hasn't saved in the last decade while equities have crashed twice, the last place you're likely to try to save is in the stock market.

In fact, according to the sources I watch, it's the bond market which is benefitting fom this situation rather than equities. The reluctance of the public to get involved in this rally is notable. Of course that may change, but a continued bull market depends on the public becoming tempted by stocks.

Also, according to several academic studies (never mind common sense), boomers cashing in equities to fund their retirement will be a serious headwind for stocks in coming years.

[borderdude]

So where does that leave us for investments? Gold? Commodities? The mattress? Where do we put money now that there seems to be little upside to equities, bonds that will get trashed when interrest rates inevitably rise, commodities that will drop if we have a double dip recession? How in the world do you make money in this environment?

[Abitibidoug]

In response to Borderdude's question I think that the best strategy is to take some of your profits, put it in cash (like treasury bills or money market funds) and wait. There will probably be good buying opportunities ahead, and if so you will be prepared to take advantage of them.

It's an example of the saying that to do well in investing you need 3 things, namely patience, patience, and patience.

[Abitibidoug]

In response to Borderdude's question I think that the best strategy is to take some of your profits, put it in cash (like treasury bills or money market funds) and wait. There will probably be good buying opportunities ahead, and if so you will be prepared to take advantage of them.

It's an example of the saying that to do well in investing you need 3 things, namely patience, patience, and patience.

[Abitibidoug]

In response to Borderdude's question I think that the best strategy is to take some of your profits, put it in cash (like treasury bills or money market funds) and wait. There will probably be good buying opportunities ahead, and if so you will be prepared to take advantage of them.

It's an example of the saying that to do well in investing you need 3 things, namely patience, patience, and patience.