Still Rising

Talking Real Money - Investing Talk

Don McDonald

Education, Business, Investing, How To

4.5 • 811 Ratings

🗓️ 21 August 2025

⏱️ 32 minutes

🔗️ Recording | iTunes | RSS

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Summary

Why has the stock market been so persistently resilient despite crises like COVID, wars, and inflation? Don and Tom explore whether the current generation of investors is simply too inexperienced to remember real bear markets—and what that means for the future. They reflect on market history, including the 2000–2009 “lost decade,” and warn against overconfidence and overconcentration in U.S. large caps. The episode covers lessons from diversification, the value of bonds, the illusion of wealth during bull markets, and listener questions about rebalancing strategies, tax-efficient withdrawals, and international fund choices. They wrap up with a hilarious movie segment and a plea to get financial plans in order as fall approaches. 0:04 Why has the market been so resilient for nearly 20 years? 1:01 Buy-the-dip culture vs. true bear market experience 2:20 Recalling the 2007–09 crash and its emotional aftermath 3:15 Younger investors haven’t seen long-term pain—yet 4:07 A history of “new paradigm” optimism before brutal downturns 5:30 Rising 401k balances vs. uncomfortable overconfidence 5:46 Buying the dip… or being the dip? 7:21 The savior during lost decades: diversification 8:45 “Winter is coming”—how to prepare like a Northerner 9:34 The return of bonds and rechecking your allocations 10:20 Hidden risks of U.S. stock concentration 11:14 Take 20%–50% off your portfolio mentally—it’s not all yours 11:44 Listener questions: mic technique and financial reality check 13:24 The movie theater saga: terrible options and funny reviews 17:00 Listener Q: Calendar rebalancing vs. opportunistic rebalancing 18:50 Listener Q: Selling winners vs. minimizing capital gains 20:10 Listener Q: Comparing AVDE, AVNM, and Dimensional ETFs 24:58 Tax-loss harvesting with Avantis and Dimensional 26:24 Amazon’s latest 3%-fresh movie disaster 28:12 Time to get your financial life in order—fall is coming Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Reality Radio for a really great future.
0:07.9	We're talking real money.
0:10.6	So why, why, oh, why, oh, why has the stock market been so bloody resilient for the past, oh, I don't know. Are we going on 20 years now that it's been
0:26.0	pretty much resilient? It's just, I mean, it has little times when it goes down, but big market
0:30.7	declines. We haven't had a big protracted one since 2008. Why is the market so resilient in the face of all these scary things that have
0:41.5	happened from COVID to tariffs to wars and the like? What is the answer? I'm Don McDonald,
0:51.5	along with Tom Cock, and what are we doing? Well, we're talking
0:55.8	real money with you on the Talking Real Money podcast. Glad you chose to be a part of it.
1:02.2	Yeah, this is a fascinating thing, because first of all, no one really knows why stock prices
1:08.3	are going up, right? Unless you talk to the 65 million people to trade every day or whatever, that's some big number, right?
1:15.5	Because more people are buying stocks than are selling stocks.
1:18.4	That's my line. Then you always get mad at me for that. Well, it's kind of the truth.
1:23.3	It is absolutely true. I mean, that's the only thing we know for sure. It's going up because more people are excited about it than are fearful of it.
1:32.5	And yet the Wall Street Journal writes articles like this. A new generation of buy the dip investors is propping up the market, adding to the froth that's already on top of overpriced stock prices.
1:43.9	Well, why is that wrong?
1:45.6	Because that sounds right. It's somebody's out there buying stuff. Yeah. But is that because they're
1:52.5	buying the dip? Is that because every two weeks they take money that goes in their 401k and they buy?
1:58.4	Is that because they're so smart that they know when they're 25,
2:02.4	you should just keep buying every few weeks because the market always goes up in the long haul?
2:07.1	Well, nobody knows that. But they do talk a little bit. You mentioned an interesting period, 2008,
2:13.4	because I went back and looked at the numbers. It's not pleasant. October 2007 to March 2009, pretty long period of time. I mean, that was a real bull market. And the market was down over, I'm saying the market, the S&P 500, down over 50% in that period of time. That is a whole, it's a deep decline and it's long time. You said bill market.
2:35.4	Bear market. Bar market. Yeah. Bear market. Yeah. Very, very, very, berry. Very, very. Very. Um, so in the
	...

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