Let me start by saying I have personally lost quite a bit of money years ago in the Stock Market, like most Americans.
However, I was fortunate enough to reclaim my losses through capital gains on the sale of one of my properties, allow me to explain. What most Americans do NOT realize is, if you lose a large sum of money on the Stock Market, you can only claim $3,000.00 in losses and you can only do so for 3 or 4 years, that's it.
So let's say you lose $300,000.00. Yes, you guessed it, you can only write off $3,000.00!!!!!! However, if you happen to sell a piece of property that you own within that 3 or 4 year period, you can write off your losses on the Stock Market against your capital gains. So while property values drop, the chances of your being in that position are slim to none any more.
Every single day I look at different Websites and watch them boast about how the Stock Market is doing. Most days they'll say, stocks rose because unemployment went down, interest rates remain low, blah, blah, blah. The next day, or maybe two days later you'll read how stocks went down because unemployment rose slightly.
Here's the deal though Folks. The New York Stock Exchange will NEVER, EVER, see another penny invested by me. While you take the gamble and the Federal Government steps in to rescue select companies, if WE happen to lose money, we're not allowed to write off the full loss, period.
I have been telling everyone for years, the Government will suck you dry, then do it again. Once you're broke, they'll get you to borrow money against ANY equity you may own or perhaps even create programs like Cash for Clunkers and get you to buy something you really do not need. Once you are broke again they'll come up with things like a soda tax, $ .89 tax on a $2.00 bottle of soda. That's just a mild example.
So I ask you, why in the world would anyone ever consider playing the Stock Market again? Is it because someone just might buy that brand new company like Microsoft and become a billionaire in a few short years? I have asked for the past 7 years, where's the new Microsoft? Where's the new Industry that will bring America forward again? Oh, that's right, all those companies are in China. They used to be here but they left because they pay less than a dollar an hour while the average wage in America is $29.00 an hour.
Yeah, I think I'll keep my money in Real Estate for the time being, even though that value can't be trusted any more either. Besides, who has money to buy stocks anyway. What a Country!
DelMarVa's Premier Source for News, Opinion, Analysis, and Human Interest Contact Publisher Joe Albero at alberobutzo@wmconnect.com or 410-430-5349
Maybe Obama can give you money to invest.. why not ask him
ReplyDeleteso it's the government's job to allow you to write off your losses... not sure what the connection is
ReplyDeleteAlso, you mind-set is completely ignorant.. as the stock market has over the past 100 years far exceeded growth by huge percentages than any other investment
It's your loss--and your loss to inflation some day
No one cares you don't want to invest.. I am heavily invested doing very well over the long-term
Just an ignorant post this is
I agree Joe.
ReplyDeleteSeveral years ago I began listening and watching YouTube videos from 2 Main Stream Economists/Money Managers: Peter Schiff and Gerald Celente.
They have been saying what you just said - for several years. They are allowed occassionally to speak on the Main Stream Media - only to be poked fun once they speak the truth. Shciff is running for Senator in his State (unknown).
They have also both explained very clearly for all who are willing to listen (for free on YouTube) that our economy no longer exists. It has been destroyed. What is left is a shell of an economy totally controlled by the international bankers. They contol it and us with CREDIT. They have created the booms and busts of the last century. They are attempting to re-inflate a bubble now - in the stock market and appear to be successful. However, it will burst of course. Your advice is good advice. Stay away from the stock market.
why would you ever "play" the stock market? If you lost significant money in the last downturn, it is your own fault. especially since you should have learned from the dotCOM burst. There are ways to invest in the stock market without "playing" it.
ReplyDeleteAbsolutely untrue that you can "only do so for 3 or 4 years, that's it."
ReplyDeleteYou are right that you can only write off $3000 a year, but you can do that indefinitely, until you use it up. You don't lose it.
Whether or not that's a good policy is another discussion.
anonymous 12:17, you're wrong.
ReplyDeleteJoe, You don't lose money until you sell. So stick with dividend paying stocks and sit back and collect the quarterly dividends.
ReplyDeleteI am also under the impression that carry-forward losses can be taken until they run out.
ReplyDeleteIn the case being discussed here, that would take 100 years!
"mind-set is completely ignorant.. as the stock market has over the past 100 years far exceeded growth by huge percentages than any other investment"
ReplyDeleteSorry, not a very insightful statement unless you are planning to liver 100 years or more. The truth is that the market ups and downs are cyclic and, with average life spans, you need to enter/exit at the right part of a cycle. Same goes for other types of investments.
I was in the stock market during the dot.com period. Got out at the peak and invested in a fixer upper condo just as prices were starting to go up. Sold my primary residence in MD at the peak then invested in energy related stocks. Real estate market began to deflate so I sold my energy stocks to get a new primary residence at a great price. Oh yes, sold my condo at twice what I paid for it and paid off all my mortgages because the economy was beginning its failure.
See? No single thing is the right thing forever.
Actually, 12:17 is correct. You can deduct your capital losses $3,000/yr until the losses are exhausted. Please don't knock the stock market.It has been in existence since our independence, and it represents the "free" market" As our freedoms are being diminished by the current administration, please don't help them along.Thanks.
ReplyDeleteAnonymous 12:17 is right. Joe, please refer to Publication 550 of the Internal Revenue Service and also Section 1212 of the Internal Revenue Code.
ReplyDeleteFrom the IRS Website:
Capital loss carryover. If you have a total net loss on line 16 of Schedule D that is more than the yearly limit on capital loss deductions, you can carry over the unused part to the next year and treat it as if you had incurred it in that next year. If part of the loss is still unused, you can carry it over to later years until it is completely used up.
When you figure the amount of any capital loss carryover to the next year, you must take the current year's allowable deduction into account, whether or not you claimed it and whether or not you filed a return for the current year.
When you carry over a loss, it remains long term or short term. A long-term capital loss you carry over to the next tax year will reduce that year's long-term capital gains before it reduces that year's short-term capital gains.
Sounds like you got some bad advice.
I agree with your stance on real estate. People are still procreating and they aren't making any new land. And yes, losses from stock can be offset from the gain on the sale of real property.
I think buying stock can be overated but such vehicles as emerging market etf's and fixed income products can prove to be lucrative and not necessarily subject to the up and down volitility of our current market.
anonymous 1:59, thank you for that research. I have contacted my accountant to see if perhaps I misunderstood something. I'll let you know when I get a call back from the accountants.
ReplyDeleteThe stock market is not a "game". Over the very long haul stocks, ownership in companies, have the best returns of any investment group. I was a broker for ten years, and made much more from my investments, than from my clients. FYI: The $3000 a year capital loss can be carried over year after year, until used up, and can be used to offset a real estate capital gain. The bad side of large capital gains, unearned income is Alternative Minimum Tax. Paying at a 35% rate, when you expect to pay 15%, can be a killer!
ReplyDeleteThe stock market is being manipulated by banks who have created extra money for themselves. They refuse to share it with us, but encourage us to invest our hard earned money into a "game" they created and control. The one commenter is either extremely lucky to have timed their game, or had inside information.
ReplyDeleteIt is easy to make money in the stock market. One must know secrets which are kept from other people. Period. If you know the secrets you can make a lot of money (off those who have unwittingly invested while not possessing the secrets needed to know when to buy and when to sell).
Some "investors" understand to what I am referring - but do not refer to it as a conspiracy. However if several people secretly engage in a practice or behavior which is detrimental the larger public, such as committing fraud (by misprepresenting the value of a company's assets), the individuals involved are criminals guilty of conspiring to defraud the public.
The stock market manipulation is a fraud against the American public who are not aware that a secretive group of people are controlling entire markets for self-benefit. Our government has now garunteed these corporations' debts with the promise to pay them through forced taxation (which can and does take many many different forms but includes a taxation on our labor). If the elites lose money then, we the people, will pay their debts - and we will be forced each and every one of us to pay those debts!
Educate yourself
If the average wage in America is $29 then that stat is including hedge funders, Bill Gates, CEOs and others. Certainly, the average American WORKER does not make anywhere near this figure.
ReplyDeleteWhat did you hear from your accountant, Joe?
ReplyDeleteNothing yet, tax season.
ReplyDelete