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Is it just me? or have you noticed a dramatic change in discourse on this forum as the market has been gaining?

CMF started right around the beginning of the crash, and there was very little discussion about what people are doing with their extra cash, and everything focused around personal finances, budgets etc. Now that the tide is rising, there's been a shift in discourse and much more disclosure about specific investments.

Seems like the opposite should have been occurring?
 

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Seems like the opposite should have been occurring?
For as long as I've been reading financial forums, I have found that, as markets tend to heat up, and as deals become harder to find, people post more about:


  • investing in riskier strategies (using leveraged buyouts, more people opting for lower-grade bonds, and that sort of thing)
  • more and more people asking, "Are we in a bubble", with hopefuls who always respond with, "No, and here's why!"
When markets decline, I've invariably seen posts about "how low can the <index> go?" and "where can I find the best interest rates?".

It's a classic example of people wanting the good times to keep going. As a contrarian investor, posts about "market recoveries" and "pockets of value" tend to make me nervous.

K.
 

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I find the same with the comments on the blog as well. In late 2007/early 2008, commenters disagreed that expectations of stock market returns going forward are modest. In the midst of the crash, commenters disagreed that stock markets are priced to deliver outsize gains. Message boards and blogs are excellent indicators of consensus opinion. These days, it seems to me that the bears outnumber the bulls: the majority of investors seem to be on hold for a pullback. That's my reading of the consensus... I could be wrong.
 

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Along the same lines, in March 2009 (market low), Ed Rempel wrote an article titled "Irrational Pessimism". Check out the comments, the majority were very negative on the markets at the time due to various reasons. A select few saw bargains, but many (like me) were afraid to act on the bargain low prices.
 

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I am your steady weather gal. I only ever really respond to or write about financial planning, not investing, no matter what the markets are doing.

Honestly, writing about investing feels like "work" to me (because providing investment advice used to be my work. I think I have a psychological block about providing "free advice," if that makes sense. Plus, it just isn't as interesting to me as financial planning topics).
 

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CC i'm not sure i understand your message. You cite 2 recent examples where the cmf consensus was wrong. Might you be pointing out that the consensus tends to be wrong, and would this not suggest, in turn, that the bear worriers these days are somewhat off the mark ...

there's another factor to consider. Perhaps the readership has changed. The circumstances one year ago were severe; there was at that time a good chance the global financial system would collapse. People i knew were worried about their jobs, worried how to cut living expenses to the bone, worried about survival. I wasn't a cmf member a year ago, but it doesn't surprise me that many of the posts were about budgeting in frightening times.

if there have been a few mildly bullish posts in recent weeks & months, these don't signify a stock market bubble to me. On the contrary, one might say that the budgeteers had finally got it out of their system, because how many times, really, can anybody post about their budget ? surely not more than once a year. On the other hand financial markets require constant monitoring.

one straw in the wind on this forum are the pink sheet, day & forex traders. I don't recall many of these last summer. Now one spots them regularly. Not yet in numbers sufficient to indicate a frothy market top, but the proliferation is noticeable.
 

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Discussion Starter #7
there's another factor to consider. Perhaps the readership has changed.
I certainly think this is a real factor, maturation of the forum perhaps?

What I find most interesting is following individuals through their own progression of posts. New posters (no knock on them, fresh and new ideas are always good) these days seem to 'gain their investing/trading' confidence very quickly in these times. Even if people come to the forum extremely green, their transition to confidence and sharing 'experience' comes rather quick these days.
 

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CC i'm not sure i understand your message. You cite 2 recent examples where the cmf consensus was wrong. Might you be pointing out that the consensus tends to be wrong, and would this not suggest, in turn, that the bear worriers these days are somewhat off the mark ...
I was talking about reader comments to posts on the blog. I was trying to convey that consensus opinion is somewhat of a contrarian indicator. And yes, my reading of the consensus is that many investors are sitting out the rally. They remain unconvinced that the rally is real, which might be good news for stocks.
 

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" ... many investors are sitting out the rally. They remain unconvinced that the rally is real, which might be good news for stocks."

yes, that's what i thought you were implying, CC. Just wanted to confirm.

not that my opinion matters, but i'd put roughly a 60% probability on continuation of the upward trend. Perhaps not immediately, but going out say a couple of years.
 
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