Before everyone starts leaping and jumping for joy, it is a good idea to put everything in perspective.  Since March 2009, stocks have made a remarkable recovery.    The bottom had also fallen out of the stock market, so much recovery was needed. 

Several people have said they have broken even to where they were before the crash.  I offer up scenerios.  Those people either weren’t invested heavily in equities or they fed their accounts a lot this past year.  For those who have static accounts, the recovery doesn’t come near to breaking even. 

According to USA Today:

Once it was clear a collapse wasn’t going to happen, the Standard & Poor’s 500 index roared back 64.8% from its early March low. For the full year, the index rose 23.5%, or 211.85 points, it’s best showing since 2003.

 The Dow Jones industrial average rose 1,651.66, or 18.8% for the year. From its March 9 close, the Dow jumped 59.3%. Powered by the recovery in high-tech stocks, the Nasdaq ended 2009 with a gain of 696.12, or 43.9%. Tthe Nasdaq has surged 78.9% from its March low.

 

Up until March of last year, many people were fearful of opening their statements.  If one lost 40% in the crash, and many of us did, it will take a lot more than 40% increase to bring you back even.  That’s the math of percentages.  I have a 401k that increased by 33.6% but I am not even close to being back to the fall 2007 high water mark.  Not even close.

Analysts do not expect the current rate of increase to continue.   While the pace will slow, the markets are still expected to do well.  There is a great deal of superstition about the first day and week of the new year.  I guess we get a sneak peak tomorrow.  I am keeping my fingers crossed that we have a bang up day and that the bulls will run hard.

Have investment strategies changed with our readership?  Those who went conservative missed out on the the biggest rebound since the Depression.  I was too paralyzed by fear to do too much.  My account that lost the most was the one I pay to have managed.  Go figure.  And I like the manager.  He is reasonable and knowledgeable.  I don’t blame him. 

Then there is the dollar scare which I have never figured out.  How does this affect how we invest?  How about buying  gold and silver? 

Disclaimer:  Any discussion about investment is only discussion, not advice.  Call your financial advisor if you want professional advice.  If there is any other disclaimer I need to put up, someone tell me!

58 Thoughts to “Stocks Post Biggest Rebound in 2009 Since Great Depression”

  1. Poor Richard

    Laissez Les Bon Temps Roulez !

    Por Favor

  2. JustinT

    I never expected the market to rebound so quickly. Weird to think it was such a short time ago that I thought the global economy was going to crash and we were headed to Beyond Thunderdome territory.

    I have some mutual funds that I almost unloaded because I didn’t want to lose 100% of what I had already lost 50% of. But someone I trusted said, no, you don’t want to lock in your losses. He was right. I checked a few months ago and I was within 10% of where I was before the crash. I haven’t checked lately which is the best sign of all. Things are back to normal. My plan always was to leave them alone and not bother checking for another 40 years. I haven’t checked, so that means I feel secure again.

  3. Check on them periodically Justin. Some funds stop being good funds. You will need to rebalance. Go back to that person you trust. Even those who don’t look should rebalance things yearly especially if holding a mutual fund portfolio. Congratulations on being back within 10%.

  4. GainesvilleResident

    There were a bunch of people at work who panicked and dumped all their mutual funds in their 401k around the end of 2008. They basically sold at the bottom, and then missed out on the recovery since it happened so fast. I couldn’t believe they did that. In fact, a few of them even for some reason decided it didn’t make sense to contribute to the 401K while the market was going down. That even made less sense to me, for one thing they missed out on our employer match which is 50% of the first 9% of your salary you put in. Also, at that time while the market was dropping you were picking up mutual funds at cheap prices.

    In short, I think a lot of people panicked during the market drop and made some extremely poor decisions. Also, some of that panic selling actually contributed to the huge market drop.

    Of course, now the market has almost risen back too fast – so it’s hard to tell what will happen this year. It will be interesting to see what happens when the 1st quarter earnings start coming out later this month, and how the market reacts to them.

  5. Those folks at work sure don’t understand the concept of a bargain do they? Where did they put their money when they abandoned their mutual fund accounts? Are they going to have to pay taxes on it now or did they just set up in cash accounts?

    You have a pretty good deal with that 9% salary match. They also don’t understand the concept of free money. Very few employers give that kind of match. Best I ever got was 100% match on 5%. I could contribute more but no match.

  6. Anyone know of a group that will let you invest in stocks if you only have $100 or so to put down?

  7. Poor Richard

    Get rich quick schemes are nothing new.

    The big “sure thing” here in 1910 was Penn-Vir Oil Company
    that was selling shares “while they last” in the Manassas area
    for the “sure thing” drilling in the “newly discovered massive
    oil fields surrounding Nokesville, Virginia!”

  8. The markets are soaring today. Run bulls run! I am superstitious enough to watch the first day of the year. This is a good sign!!!

    How did those oil fields pan out for them, PR? Maybe that’s why the stock market crashed.

  9. Poor Richard

    The Nokesville wells were apparently money gushers for the
    con artist who duped the locals and then fled town
    (they did build one derrick that remained a Nokesville
    landmark for decades).

  10. GainesvilleResident

    Very interesting about the historical get-rich scheme in Nokesville. Times don’t change apparently, sounds like a lot of much more recent get-rich schemes.

    Indeed, the market is off to a very good start today. Let’s hope it’s a good omen. But I think the real telling point will be once the 4th quarter earnings start coming out around the middle of the month and how the market reacts to them. There may be higher expectations that may not be met, it will be interesting. I’m a little nervous about high expectations on some of my stocks and will be watching closely. But today is a good day so far – everything is way up, so we’re off to a good start. The last part of December was rather lackluster, to say the least. It may just be “new year’s optimism” as it sometimes is common at the beginning of the year in the stock market. Time will tell.

  11. GainesvilleResident

    Poor Richard got me curious about that Penn-Vir scheme – I did a google search and find the following reference to it on some other website:

    A Flyer In Oil
    Is Worth A Lifetime of Toil –
    Why Work Hard if You Have
    Money That Will Work Hard For You?

    The Penn-Vir Oil Co. has just completed a well near Manassas
    and it is gushing 5,000 barrels a day! A monument should be
    erected to those whose faith brought it to pass.
    Manassas has the best waterworks, lights and streets of any town
    in Virginia and every man, woman and child here will benefit
    by the finding of oil. Those who enjoyed prophesying failure
    now regret they did not buy our first stock offering.
    Better invest your money today for tomorrow may be too late!
    I will fill your order promptly, M.B. Nicol – Manassas, Va.”
    The Manassas Journal
    (May 19, 1911)

    Sure sounds just like a more modern day stock scam to me! I’ve in recent times gotten mailers about some small penny stocks that are in the oil business, or lately solar power or other “green” business and how they are on the verge of a breakthrough. If you read them, they sound just like what’s above. Things haven’t changed much in 100 years as far as the stock scams go….

  12. Maybe it was lackluster because people were balancing out things for the end of the tax year. I am optomistic.

    I wonder if that Nokesville duper ended up in jail like Madoff.[ooops I misspelled his name earlier.]

  13. GainesvilleResident

    I wonder how much money “M.B. Nicol” managed to fleece out of people…

  14. There is a Nichol Lane over in the City. I used to live there. I wonder if there is any relation?

    What a scoundrel! Human nature at its worst. We are fortunate that we have as many checks and balances for our investments as we do.

    ooops different spelling of Nicol. Sorry Nichol Lane.

  15. GainesvilleResident

    You might be right about end of the year selling for capital gains purposes, MH.

    I too am cautiously optimistic about the market this year – but I’ll have a better opinion once the earnings season hits in a few weeks.

    In those days who knows what the laws were like regarding stock investments. Did the SEC even exist then? Anyway, they were next to useless as far as Madoff – in fact they ignored obvious signs about him. Not to mention Enron, WorldCom, and a whole other laundry list of recent stock scams.

  16. GainesvilleResident

    I hope that street isn’t named for the oil scammer!

  17. GainesvilleResident

    Never mind – I see you pointed out the different spelling.

  18. GainesvilleResident

    By the way – your 401K increase of 33.6% is really good. My main 401K only gained 28.2%. Then again it lost 40.0% in 2008, and even a 40.0% gain last year wouldn’t have caught it up. It is higher in value at the end of this year compared to the end of 2007 only because of all the money I’ve dumped into it in 2008 and 2009 (the max allowable by law for 401K contributions). Otherwise, it would still be less value than at the end of 2007!

  19. Poor Richard

    I know the value of a 401K is only really important when you start to draw
    down on it during retirement and not the expected ups and downs during
    the years before — but I still check the NYT at least twice a day.

    May the bulls run!

  20. GainesvilleResident

    On the other hand, my personal stocks did incredibly well in 2008. It would be hard for me to work out the numbers but I realized more than a 100% gain during 2009 due to a couple of really high performing stocks that I lucked into. I’m very nearly close to wiping out my losses from 2008 – even after selling a bunch of stocks late in 2008 at heavy losses to finance purchase of my house in Gainesville. 2009 was a good year, let’s hope 2010 will be like it. Personally, even if it was half as good as 2009 I wouldn’t complain – I think it’s almost too good to hope for a repeat of 2009’s performance, but we’ll see….

  21. GainesvilleResident

    Poor Richard – I’m like you – I follow my 401K daily even though I’m a good 15 years away from retirement. I enjoy watching the ups and downs (well, I didn’t enjoy watching it so much in 2008 – it was getting depressing dumping money into it every paycheck but seeing the balance going down down down down!).

  22. Poor Richard and I are a little further along than you are, GR. I still check daily also and watch the stock market like an eagle.

    GR, you have those robots…and I am green with envy. Talk about a great investment!

  23. GainesvilleResident

    I admit to checking the stock market 4-5 times a day to follow my personal stock investments. My 401K’s are primarily in mutual funds except for a small portion in my company’s stock, so for that it only matters to check at the end of the day.

    ISRG is one of my best investments – but I’m thinking it may be topping out. Will see what happens. Bought a pile of shares at an average price of $96/share between December 2008 and March 2009, and now it is at $309/share which is very close to its 52 week high hit right before the end of the year. The P/E ratio is making me nervous, and some analysts are also suggesting it is getting highly priced. Will see what happens on the next earnings report. It is the primary reason I’ve very close to breaking even on my stock losses of 2008. Actually, if I hadn’t sold a bunch of stock in 2008 to finance purchase of my new house, I would have more than made up for my losses in 2008 by now.

  24. Poor Richard

    I’m looking for the next Southwestern Energy (SWN) which hit $48.20
    last month, up from .82 cents a decade earlier, for a gain of
    5,778 percent.

    Either that are getting a lot luckier with Lotto.

  25. Fabulous start for the new year. Go bulls go!

    DJIA
    10,584.49 156.44

    NASDAQ
    2,308.42 39.27
    S&P 500
    1,133.02 17.92

  26. Poor Richard,

    I would have never hit that one. Good grief!

    How are some people so lucky?

    That darn stock held its own during the crash also. I might have to own a little of that just for good luck. Wolfie is superstitious about her stocks.

  27. Gainesville Resident

    Poor Richard – I almost invested in HGSI (Human Genome Sciences) earlier this year when it was trading at $1/share. I can kick myself – I was very close to doing it. It is now trading at $31/share. I could have made a 30x gain in about 9 months time! Such is life…

  28. Gainesville Resident

    As a disclosure I did buy into HGSI a small amount at $25/share, but nowhere near what I would have put into it at $1/share (in terms of dollar amounts – not to mention the number of shares that would have translated into). And, I’m a little spooked about it climbing much higher than where it’s at now…

  29. Gainesville Resident

    Moon-howler :
    Fabulous start for the new year. Go bulls go!
    DJIA
    10,584.49 156.44
    NASDAQ
    2,308.42 39.27
    S&P 500
    1,133.02 17.92

    Indeed, a great day. Several of my stocks were up over 3%, and across all my stocks, I gained 2.15% today. The jury is out on my main 401K – it’s results won’t show up until first thing tomorrow morning.

    Anyway, a great way to start out the new year.

  30. Gainesville Resident

    The other people who were lucky were those who were smart and invested in Microsoft when IBM made their DOS operating system the one for their first IBM Personal Computer. I almost invested in Microsoft back then, but didn’t. Another regret of mine. I was going to sell some of my IBM stock to finance that (being an IBM employee at the time) but decided the IBM stock had more growth potential. Oh well….. I forget now how much a share of Microsoft stock would have sold for then, but today it is worth many many times that amount, whatever it was.

  31. No sense crying over spilt milk, I guess.
    To those who have a while before retirement, even if your company doesn’t match you, put money in that 401k. If you don’t like the options, open an IRA. Do it regularly, auto withdraw so you don’t even notice it is gone. You will thank yourself later.

    Don’t count on social security. The boomers are going to gobble it all up. Boomers are those born from 1946-1964. 18 years of gobblers.

  32. Gainesville Resident

    I agree 100% with MH’s last post. Good advice. Shockingly I’ve read disturbingly low (in my opinion) percentages of 401K participation.

    Indeed, at least start out small – even 1% and then increase as your salary increases. 1% may sound small, but it’s better than nothing! That’s for 401K contributions. If you don’t have an employer with a 401K, then as MH says, put some small amount each month into an IRA, even $25 over 12 months is $300. Not a huge amount of money, but better than $0, and try to grow it as your salary grows over the years.

    Some companies are going to a system where new employees are auto enrolled at the time of their hiring at some percentage (5% maybe) of their salary, just to try and force them into participating. After they are hired, they can change this right away, but the hope is they’ll just let it ride. I don’t think my company does this, but I’ve read articles that there’s a fair amount of companies out there adopting this approach for new hires.

    And finally, I’m a baby boomer (1959), but I’m not even that optimistic that social security will be around in my retirement years. I’m not counting on it anyway. Fortunately I’m lucky in that I have a pension from my years at IBM, and I have another pension coming from my current employer. IBM actually stopped contributions to their pension plan in recent years. My current employer hasn’t so far, other than for newly hired employers they no longer are in the pension plan, but they get a higher 401K match than I do. However, I’m not even counting on my pensions, even though right now they add up to more than the estimate for my social security income. And, I have a feeling my employer may go the IBM route – as IBM first cut off the pensions for new hires, and then stopped adding to them for existing employees. So if my employer follows the IBM pattern, they may stop adding to my pension in another 2 years, by my estimate. Time will tell if that holds true.

    Finally, the results of today’s 401K earnings is in – up 1.6% – roughly inline with the market, which is what I expected. Even though I’m diversified among 10 different mutual funds (well one of the 10 tracks my employers stock) my 401K generally performs inline with the market. My personal stock investments on the other hand swing more positive on an up day than the market, but in general also swing more negative on a down day than the market.

  33. If you work for a company that has matching funds and you don’t participate in their retirement program, you are simply turning down free money. Even if you think you cannot afford it, force yourself. It reduces your gross income for the tax man also.

    The down side of that is, a 401k in Virginia is only worth 76% of its face value because you do have to pay those taxes eventually. 20% to the feds, and 4% to the state is taken out of each disbursement. But, if you don’t do it at all, you won’t have the 76%.

  34. GainesvilleResident

    Yes, you definitely are throwing away free money if you don’t participate, or even don’t contribute enough to get the full company match, if your company matches 401K’s. Some companies eliminated the match during the economic downturn, fortunately mine didn’t. Mine matches 50% of the first 9% of your salary that you contribute, which is pretty good. Effectively 4.5% of your salary in free money from the employer in this case. Actually, newer employees who aren’t in the pension plan get a higher match – I forget what it is.

    Unfortunately, as MH says, there’s no way to ultimately dodge the tax man. The theory sort of is, you will be at a lower tax rate when you retire, so there should be some savings. I’m not sure in practice if it works out that way – I can see it perhaps working out that way in a lot of cases, but perhaps not in some cases. Once a house is paid off and those deductions are lost, in retirement you may be in the same tax bracket you used to be in while employed but deducting a lot of money for mortgage interest. Whatever, it still is definitely a good idea to invest as much as you can in 401K’s or IRA’s, and not dwell on the down the line tax consequences.

  35. GainesvilleResident

    On a related topic, I heard a very interesting thing on WTOP this morning. The gov’t is giving GM another bailout. They are bailing out GMAC, which is the financial lending arm of GM, and sort of like a bank.

    However, the professor of economics from U of Md. they interviewed – Peter Parisi – who is always interesting, really lit into the the gov’t about this.

    He said, it’s about time GM goes to a real bankruptcy, does a COMPLETE reorg, and enough of this bailout nonsense. Not only that, they should be forced to make their union workers take the same kind of pay and benefits as Honda’s American autoworkers, rather than the more “golden” benefits the GM autoworkers get and are still getting.

    He really lit into Obama – saying this is another case of Obama paying back his debts to the unions for getting reelected.

    It is a highly interesting interview, I suspect it will repeat a few times during the morning hours. I heard it live at 6:20 AM this morning on the way to work. They often interview this professor, and I’ve found his commentary to be excellent. He is highly critical of this entire bailout business, and seems to have sound supporting facts that show this isn’t the way to do it. I personally can’t believe GM is getting yet another bailout. Their reorg was not a true bankruptcy reorg – it was one of the fastest bankruptcy reorgs on record.

    Then again, I did profit slightly in the days before GM’s bankruptcy, on a slightly risky gamble I got in and out of GM’s stock in a 10 day period and manged to make $500 on it, a few weeks before it went into bankruptcy on speculation that the stock would go up in the hopes of a gov’t bailout. Fortunately the bet paid off, but it could have just as easily gone the other way – or if the bailout had happened a bit faster than I anticipated the shares would all have been worthless.

    Anyway, I wish they’d post this interview in audio form on their website, it is really worth llistening to.

  36. GainesvilleResident

    And guess what just popped up in my e-mail box this morning – a perfect example of a stock scam – reads just like what Poor Richard talked about way back in 1910. Some things never change. It is a funny coincidence I just got this e-mail this morning. Usually, I get this stuff in the postal mail in the form of glossy flyers, this is the first time I’ve gotten an e-mail – apparently they’ve glommed onto my e-mail address now.

    I’m cut/pasting it into here for amusement purposes only. Please please please don’t anyone go out and invest in this company! The shares may sound like a bargain at $1.05, but they are more likely to go to $0 than to anything higher than $1.05!

    For your reading enjoyment:

    U.S. Geological Survey announces the largest
    oil find since 1968…
    Just recently I alerted you to a blockbuster oil discovery that put Jayhawk Energy (JYHW) in
    the middle of a 503 Billion Barrel Ocean of Oil.
    In no time at all, share prices skyrocketed 100%.

    I also let you in on America’s Energy
    Company (AENY) as another big winner
    …and it has more than tripled!

    Now I’m telling you the best is yet to come…

    In the next 30 to 60 days, I believe JYHW will
    be making major announcements regarding
    it’s Williston Basin projects. This breaking news
    could send JYHW shares soaring even higher!

    My newly released report explains this forecast in detail…why JYHW is breaking out now and why should buy all you can get your hands on. You can read further by following the link below.

    Don’t miss this.

    Select here for my free JYHW Special Report

    Yours for Profitable Investing,

    signature
    Jarret Wollstein, Publisher
    Intelligent Investor Report

  37. GainesvilleResident

    And sure enough – what a shock, checking a financial blog I look at, a bunch of people got similar e-mails about this stock, but each one is from a different source.

    As someone said on that blog, a classic pump and dump scheme. The only ones who profit are those who are in on the scam. The rest of the investors try to buy shares while it looks like the stock is rising, only to find the scammers start selling large quantities of the stock and take their profits, and then the share price plummets leaving the new investors holding the bag.

  38. GainesvilleResident

    And just for further education, here’s someone who did some fact checking on this company – in typical penny stock business – this company once wasn’t even in involved in energy:

    This Company is a Scam

    I did some checking and turned up the following very telling report – get a load of this company’s business just 2 years ago and what line of business they were in:

    Results of Operations:

    For the three months ended June 30, 2007 and June 30, 2006.

    Revenues. We had no sales for the three months ended June 30, 2007, as compared sales of $432 for the three months ended June 30, 2006. For the three months ended June 30, 2006, we had $297 in cost of goods sold, resulting in gross profit of $135 for the period. Since we had no sales during the most recent period, we had no gross profit. We do not expect that we will not generate any revenues from our jewelry business as we are discontinuing the operations related to our jewelry business. Going forward, we hope to generate larger revenues as we implement our new business plan, which we adopted in April 2007. We are now moving into the exciting energy business!

    This company changed its name from Bella Trading Company, and is now an “Jayhawk Energy Company” but before that they were selling jewlery when they were Bella Trading Company.

    Fascinating how a company can switch from selling jewlery to going for oil exploration at a flick of a switch! What a fantastic business plan!

    If anyone is stupid enough to buy into this pump and dump scheme, I have some swamp land you may be interested in.

    Their “new business plan” is to scam suckers into buying their stock.

    Too bad it doesn’t have a disclosure statement for “Complete Scam”

  39. @GainesvilleResident
    GR, do you know if you have to pay taxes when you start using IRA money if the money going in there has already been taxed?

    I don’t have a 401K or any retirement, so this whole thing worries me.

  40. GainesvilleResident

    In reference to my post #35 above – about that highly interesting WTOP interview, I contacted WTOP and to my great surprise, they do have it on their website – I had just not searched hard enough for it!

    Anyone interested in the gov’t financial bailout stuff – will find this interview both interesting and entertaining! Even if you don’t agree with his point of view, which is AGAINST the gov’t bailouts of GM (both the original and this new one of their GMAC arm).

    The link is below in the e-mail reply I got back from WTOP when I queried them if they could put the interview online (turns out, they already had it online – I just hadn’t located it). As they said, he’s a frequent interviewee early in the morning, and always entertaining and informative (in my opinion).

    Worth a listen – just follow the link below:

    Dear XXXXX:

    You heard Peter Morici this morning. He is a regular on WTOP. Here is the link to the interview you heard:

    http://www.wtop.com/?sid=1855635&nid=93 .

    Here’s a little more about him: http://www.smith.umd.edu/lbpp/faculty/morici.aspx .
    Colleen Kelleher
    WTOP.com
    202-895-5266

    Your e-mail:

    Any chance the interview this morning with Dr. Peter Morici can be posted online on the website? I’ve heard his interviews often and always enjoy them, but found the one this morning about the new gov’t bailout of GM (of their GMAC arm) particularly interesting. I would like to share it with some people I know who might find it of interest.

    By the way, I listen to WTOP on my morning commute to work from 5:50 AM – 6:30 AM every morning and always enjoy the morning show there. Actually, I also listen to it on the way home from work and enjoy the evening show too.

  41. GainesvilleResident

    And a follow-up – a link to all audio interviews on WTOP:

    My pleasure. On the homepage of WTOP.com you will find something called Audio Center. Every long-form interview that is on the air is posted there. Here is the direct link: http://www.wtop.com/?sid=595567&nid=92 . Feel free to contact me any time you need something.

    Colleen

  42. GainesvilleResident

    Posting As Pinko :
    @GainesvilleResident
    GR, do you know if you have to pay taxes when you start using IRA money if the money going in there has already been taxed?
    I don’t have a 401K or any retirement, so this whole thing worries me.

    If somehow you contribute “post-tax” money to an IRA, then it doesn’t get taxed again. There is a form of IRA called a Roth IRA. In that kind of IRA, you put in after-tax money – that is you don’t get to deduct your contributions to the IRA from your taxable income. You can also convert a regular IRA to a Roth IRA but I don’t know how that works – I’ve never done that, and to be honest all my IRA’s are regular IRA’s (former 401K’s that were rolled over to a regular IRA).

    When you set up an IRA, you designate what kind of IRA is, and then at tax time, either deduct the contributions or don’t, depending on the type of IRA. So a Roth IRA lets you put money in that has already been taxed, or basically you don’t get to subtract that money from your taxable income when tax season rolls around.

    However, I have to say, I’m no expert in Roth IRA’s as I don’t have one and have only read about them a little. You can turn a regular IRA into a Roth IRA by paying taxes on all the money in it – it is treated as a taxable distribution.

    Anyway, better to consult whatever investment firm you set up an IRA with – for more accurate info, but what I wrote above is pretty accurate, I think.

  43. GainesvilleResident

    I should say, also in a Roth IRA, when you take money OUT – as you thought – you do NOT pay taxes at that time. You’ve already paid the taxes when you put the money into it.

  44. GainesvilleResident

    And were off to the races – the market just opened slightly down – as futures seemed to be indicating. Only down a hair (less than 0.1%) so it isn’t very predictive of anything. Yesterday the market was up around 0.5% right at the open.

  45. GainesvilleResident

    Actually NASDAQ is slightly positive, but S&P500 and DOW are slightly negative. These early numbers, not being significantly one direction or the other, are essentially meaningless, other than to indicate there wasn’t a strong positive start like yesterday, or else a strong negative start.

    With that, i need to get back down to the lab – so that’s the end of this financial discussion for now.

  46. @GainesvilleResident
    Thanks, GR! It’s pretty confusing stuff. I like to get views from a variety of sources as opposed to just the firm or bank that wants to profit.

    The downside to self employment is that you don’t get things like a 401k or life insurance or even health insurance automatically. And you can’t write some of that stuff off, either, so basically, unless you’re a government contractor or someone with huge accounts, you’re kind of screwed.

    Of course, there are certain perks like the ability to work from home. That’s a biggie with the kids still in school.

    Have fun in your lab. You must lead an interesting life.

  47. Poor Richard

    “Never before in the history of Manassas was there assembled
    together a body of her citizens more representative, more
    enthusiastic or more heartily unanimous in exploiting the
    development of their town, than the concourse of men who
    gathered last Friday night at the annual smoker given by the
    Manassas Business League in Nicol’s Hall. A spirit of harmony
    permeated the assembly, and ‘Boost Manassas’ was the
    universal slogan.”
    (Manassas Journal 2-4-1910)

    My kind of people! Except I don’t smoke and will pass on
    Mr. Nicol’s get rich quick Penn-Vir oil stocks.

  48. @Poor Richard
    Though “boost Manassas” is a great idea! Let’s pour some money in there.

    I wish I could afford to rent a building (or even buy one) in Old Town. I have so many ideas about what I would use it for.

  49. GainesvilleResident

    Wow – that Nicol stuff just keeps getting funnier and funnier! One sign of the times, don’t think any town would be holding an “annual smoker” these days! That was back in the days when tobacco really ruled!

  50. Pinko,
    If you set up an IRA with money you have (as opposed to rolling over an IRA or a 401K) then that money has already been taxed. However, most people use it as a tax deduction when they file their taxes.

    If you want a Roth account you have to designate it as one and there are limitations, often based on income and age. Someone at your bank can help you.

    Don’t assume that because the money is after taxes, that it automatically becomes a Roth. It doesn’t.

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