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Re: Is a big war coming ???

"Is a big war coming ???" Is that really a question, or are you trying to make some sort of statement?
Reminds me of Jon Stewart's commentary
http://thedailyshow.cc.com/videos/8ov5k ... stion-mark
by JoMoney
Tue Aug 19, 2014 8:17 am
 
Forum: Investing - Theory, News & General
Topic: Is a big war coming ???
Replies: 37
Views: 3673

Re: 'Risk Creep' - new term

... if we assume the FDIC to have the same credit rating as the US Treasury. I think it's extreme that the FDIC would fail to honour its obligations. Extreme but, I guess, must be assigned a probability, however small. Interesting, I've never really thought about the fact that FDIC isn't necessaril...
by JoMoney
Sun Aug 17, 2014 4:05 am
 
Forum: Investing - Theory, News & General
Topic: 'Risk Creep' - new term
Replies: 26
Views: 2124

Re: Morningstar data vs Factsheets

...if I want to the PB against one of Benjamin Graham’s selection criteria – i.e. PB should be below 1.5x – which one should I use? James, Are you aware of this interview with Graham that occurred several years after after the last edition of The Intelligent Investor was written? http://www.bylo.or...
by JoMoney
Sun Aug 17, 2014 1:37 am
 
Forum: Investing - Theory, News & General
Topic: Morningstar data vs Factsheets
Replies: 5
Views: 642

Re: Is earnings yield real or nominal

I believe E/P is considered a real yield. In fact, it is one predictor of equity real returns. Historically it's been one of the best forecasts of the markets return, but still highly unreliable - i.e. You might be better off ignoring it than making tactical decisions based off of it. I'm amazed th...
by JoMoney
Sun Aug 17, 2014 1:11 am
 
Forum: Investing - Theory, News & General
Topic: Is earnings yield real or nominal
Replies: 6
Views: 487

Re: Business Insider: The Stock Market Could Drop 50% Tomor

...Does anyone know how this works for mutual funds? Say that some terrible economic news comes out after the market closes and all of a sudden 10% of the investors in Vanguard Total Stock decided that they want to pull their money out. The fund doesn't keep that much cash on hand. Can funds suspen...
by JoMoney
Sat Aug 16, 2014 10:45 pm
 
Forum: Investing - Theory, News & General
Topic: Business Insider: The Stock Market Could Drop 50% Tomorrow
Replies: 14
Views: 2171

Re: 'Risk Creep' - new term

I noted that Barclays added a new U.S. "Total Bond Market" index. The older "U.S. Aggregate Index" that many bond index funds use (Vanguard Total Bond market, iShares AGG) was strictly based on "investment grade" bonds. They now offer a Barclays "U.S. Universal Ind...
by JoMoney
Sat Aug 16, 2014 10:03 pm
 
Forum: Investing - Theory, News & General
Topic: 'Risk Creep' - new term
Replies: 26
Views: 2124

Re: Business Insider: The Stock Market Could Drop 50% Tomor

Takeaway : Don't have money you need tomorrow in the stock market. If you are influenced in such a way that a low bid price will induce you to sell, you need a better plan, which may be to hold less in stocks - or as Mike Tyson put it, " Everyone has a plan until they get punched in the mouth &...
by JoMoney
Sat Aug 16, 2014 9:09 pm
 
Forum: Investing - Theory, News & General
Topic: Business Insider: The Stock Market Could Drop 50% Tomorrow
Replies: 14
Views: 2171

Re: Comparing Risk of Bond Barbell and Bullet

For an individual, if these were assumed to be long-term holdings not to be traded, or for emergency fund purposes, wouldn't EE Savings Bonds be a better solution than 30 year treasuries? If you hold the savings bond for 20 years you get a 3.53% return (based on the adjustment that guarantees they w...
by JoMoney
Sat Aug 16, 2014 2:32 am
 
Forum: Investing - Help with Personal Investments
Topic: Comparing Risk of Bond Barbell and Bullet
Replies: 32
Views: 1802

Re: Market valuation analysis

There's lots of strategies and measurement techniques we could use, but if you're trying to forecast future returns based on mean-reversion what you basically get is trying to make decisions based on "moving averages". You pick some time frame for reference and make your decisions accordin...
by JoMoney
Fri Aug 15, 2014 10:01 pm
 
Forum: Investing - Theory, News & General
Topic: Market valuation analysis
Replies: 36
Views: 1650

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Most of the businesses were privately held--BNSF was one of the few exceptions. Yes you could have bought high yield bonds in 2008, but not from any issuer as well connected and liable to quickly recover as GS. I don't know of many privately held businesses bought in recent years. It's been mostly ...
by JoMoney
Fri Aug 15, 2014 8:57 pm
 
Forum: Investing - Theory, News & General
Topic: Berkshire Hathaway - Warren Buffett - Anyone own the stock?
Replies: 110
Views: 9456

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

There is a difference in that a significant portion of Berkshires book value is in their holdings of stocks (and cash) you could go and buy yourself without paying the premium of having Buffett do it for you. For companies in which Berkshire holds common stock, that's true. But most of the purchase...
by JoMoney
Fri Aug 15, 2014 8:33 pm
 
Forum: Investing - Theory, News & General
Topic: Berkshire Hathaway - Warren Buffett - Anyone own the stock?
Replies: 110
Views: 9456

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

...Berkshire trading for 1.4x book value is nothing like having a 40% front-end load. Many stocks trade above book value. In fact, today's price-to-book ratio of the S&P 500 is 2.73, which is just about its mean and median value since 2000. Of course, if I buy VFIAX today I'm not paying a 173% ...
by JoMoney
Fri Aug 15, 2014 7:53 pm
 
Forum: Investing - Theory, News & General
Topic: Berkshire Hathaway - Warren Buffett - Anyone own the stock?
Replies: 110
Views: 9456

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

If it is like a mutual fund, it's one with a 40% front-end load (book value is around 1.4x currently). If it works out well, you'll get that back when you sell it in addition to whatever the multiple is times whatever book value growth has been achieved. If things work out well. There are some risks...
by JoMoney
Fri Aug 15, 2014 6:01 pm
 
Forum: Investing - Theory, News & General
Topic: Berkshire Hathaway - Warren Buffett - Anyone own the stock?
Replies: 110
Views: 9456

Re: Car Value/Income

My employer provided transportation is of great value to me.
by JoMoney
Thu Aug 14, 2014 4:32 pm
 
Forum: Personal Finance (Not Investing)
Topic: Car Value/Income
Replies: 22
Views: 1896

Re: Can a single investor influence the market?

Yes, a single investor (and even a married one :D ) can influence the market
Every transaction has some market impact, it's just a matter of degree.
by JoMoney
Thu Aug 14, 2014 7:39 am
 
Forum: Investing - Theory, News & General
Topic: Can a single investor influence the market?
Replies: 20
Views: 1718

Re: a number of questions on indexing

...They can and do trade among themselves. I don't know the specific pricing determinator but certainly it's market-based. That's part of how Vanguard, not uniquely, achieves low expenses. I would expect that such trades aren't completely free, because there must be some effort involved... Cross-Tr...
by JoMoney
Thu Aug 14, 2014 6:15 am
 
Forum: Investing - Theory, News & General
Topic: a number of questions on indexing
Replies: 20
Views: 2740

Re: Beat The Street's Permanent Portfolio

I think most Bogleheads set their portfolios with the idea of it being "permanent", but choose to focus on the areas that have shown the best risk/reward over most periods of time. These other sorts of so-called "Permanent Portfolios" attempt to focus on the "left tail risk&...
by JoMoney
Thu Aug 14, 2014 3:52 am
 
Forum: Investing - Theory, News & General
Topic: Beat The Street's Permanent Portfolio
Replies: 36
Views: 2997

Re: How do I calculate profitability using online data?

It surprises me that Bogleheads are so ready to buy into any of these 'factors' as predictive of anything. I think they may have merit as being a more precise way of explaining ex post returns by way of how exposed some portfolio had been to a "factor" that happened to outperform over some...
by JoMoney
Tue Aug 12, 2014 4:42 pm
 
Forum: Investing - Theory, News & General
Topic: How do I calculate profitability using online data?
Replies: 8
Views: 587

Re: Jesse Livermore’s Trading Rules Written in 1940

I don't see it on the list, but another of his quotes that might having something to it: http://en.wikipedia.org/wiki/Reminiscences_of_a_Stock_Operator#Quotes It never was my thinking that made the big money for me. It always was my sitting. Got that? My sitting tight! It is no trick at all to be ri...
by JoMoney
Tue Aug 12, 2014 3:29 am
 
Forum: Investing - Theory, News & General
Topic: Jesse Livermore’s Trading Rules Written in 1940
Replies: 6
Views: 1107

Re: Does domestic over weighting qualify as active managemen

How many angels can dance on the head of a pin? Wikipedia has some definitions http://en.wikipedia.org/wiki/Active_management Active management (also called active investing) refers to a portfolio management strategy where the manager makes specific investments with the goal of outperforming an inve...
by JoMoney
Mon Aug 11, 2014 5:11 pm
 
Forum: Investing - Theory, News & General
Topic: Does domestic over weighting qualify as active management?
Replies: 26
Views: 1189

Re: Going 60+% international? (US resident)

... Even setting aside the risk question , taxes might be enough on their own to make an all-domestic portfolio attractive. Vanguard's S&P 500 fund pays 100% qualified dividends. A full third of the dividends from their total international fund are unqualified. A taxable investors will pay 15%-...
by JoMoney
Mon Aug 11, 2014 6:30 am
 
Forum: Investing - Theory, News & General
Topic: Going 60+% international? (US resident)
Replies: 83
Views: 5866

Re: Going 60+% international? (US resident)

...So take a US investor who bought UK stock in 1900 and held it for the next 100 years. They might be tempted to think that their international stocks lost 1.00% a year because the pound fell against the dollar. They might be tempted to think they lost real money to currency risk. But in fact, the...
by JoMoney
Sun Aug 10, 2014 4:46 pm
 
Forum: Investing - Theory, News & General
Topic: Going 60+% international? (US resident)
Replies: 83
Views: 5866

Re: Going 60+% international? (US resident)

Mr. Bogle, in Common Sense on Mutual Funds, devotes an entire chapter to Global Investing. You may or may not agree, but after reading his chapter you will realize that he is extremely well informed on the subject and did not come to his recommendation lightly ("up to 20% international")....
by JoMoney
Sun Aug 10, 2014 9:05 am
 
Forum: Investing - Theory, News & General
Topic: Going 60+% international? (US resident)
Replies: 83
Views: 5866

Re: Dividend Strategy Ain't For Everyone

I would highly recommend Warren Buffets explanation in considering dividends that he lays out on page 20 of the 2012 Berkshire Hathaway Annual Report. It's a compelling argument against dividends:
http://www.berkshirehathaway.com/2012ar/2012ar.pdf
by JoMoney
Sun Aug 10, 2014 7:35 am
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10428

Re: No difference between stocks and gold?

Funny that he should complain about financial trading costs when the spreads and retail commissions are at all time lows. In contrast, the investment banks are still charging 5% underwriting fees for IPOs last I checked, so the costs associated with (public) capital formation are a factor of 100x h...
by JoMoney
Sun Aug 10, 2014 6:05 am
 
Forum: Investing - Theory, News & General
Topic: No difference between stocks and gold?
Replies: 4
Views: 638

Re: Going 60+% international? (US resident)

...Investors ultimate care about converting (say) stocks into things like groceries. When converting German stocks into groceries, I need to convert the stocks to euros, the euros to dollars, and the dollars to groceries. When I convert US stocks into groceries, I just convert them to dollars and t...
by JoMoney
Sun Aug 10, 2014 4:44 am
 
Forum: Investing - Theory, News & General
Topic: Going 60+% international? (US resident)
Replies: 83
Views: 5866

Re: Can the reverse of market timing work?

...is it possible to time your withdrawals to gain any sort of advantage?... In my view, it depends what you mean by 'advantage'. If the goal is to maximize total return (which is what most market timers are typically looking to do), I don't think you're likely to find a strategy that 'beats the ma...
by JoMoney
Sat Aug 09, 2014 11:59 pm
 
Forum: Investing - Theory, News & General
Topic: Can the reverse of market timing work?
Replies: 18
Views: 2071

Re: Going 60+% international? (US resident)

4. And defies Lord Bogle's caution to not go above 20% I don't get this. You're saying a person with some money who seeks investment, who has a look at international stocks and decides that their expected return vs risk makes sense to their personal financial context and proceeds to make the invest...
by JoMoney
Sat Aug 09, 2014 11:09 pm
 
Forum: Investing - Theory, News & General
Topic: Going 60+% international? (US resident)
Replies: 83
Views: 5866

Re: Vanguard australia fees

My guess is that it's because that's what it costs Vanguard to operate the fund. Most of Vanguards services are offered "at cost". Expenses typically go down when a fund gets more assets under management. Some of the expenses in operating a fund are a fixed price, or don't scale up proport...
by JoMoney
Sat Aug 09, 2014 10:19 pm
 
Forum: Investing - Theory, News & General
Topic: Vanguard australia fees
Replies: 14
Views: 999

Re: Going 60+% international? (US resident)

...I am suggesting that there are sound reasons for EU stocks to be valued where they are. As wrote my comment there was a bank failure in Portugal resulting in losses to stockholders and junior bond holders in the news. Example incidents of bank failures are not rumors. As far as resolution of the...
by JoMoney
Sat Aug 09, 2014 9:48 pm
 
Forum: Investing - Theory, News & General
Topic: Going 60+% international? (US resident)
Replies: 83
Views: 5866

Re: Going 60+% international? (US resident)

4. And defies Lord Bogle's caution to not go above 20% I don't get this. You're saying a person with some money who seeks investment, who has a look at international stocks and decides that their expected return vs risk makes sense to their personal financial context and proceeds to make the invest...
by JoMoney
Sat Aug 09, 2014 9:16 pm
 
Forum: Investing - Theory, News & General
Topic: Going 60+% international? (US resident)
Replies: 83
Views: 5866

Re: Going 60+% international? (US resident)

Larry Swedroe recommends no more than 50% int'l due to higher transaction costs. I think this advice is no longer valid. Total US market has a .05 expense ratio, total intl market is .18. It shoudn't be a factor.I think once you set up a us/intl number you should stick to it, so OP stick to what yo...
by JoMoney
Sat Aug 09, 2014 8:39 pm
 
Forum: Investing - Theory, News & General
Topic: Going 60+% international? (US resident)
Replies: 83
Views: 5866

Re: Going 60+% international? (US resident)

... Warren Buffett says the average person will do very well investing in an index fund that buys America. He is also putting his money where his mouth is and doing that for his wife if he passes on before her. It is all going in the Vanguard 500 Index Fund. He also has said numerous times, you can...
by JoMoney
Sat Aug 09, 2014 2:57 am
 
Forum: Investing - Theory, News & General
Topic: Going 60+% international? (US resident)
Replies: 83
Views: 5866

Re: VBS upgrade roll out has started

My ROTH IRA account became eligible for upgrade (despite having several $0 balance / closed funds in the account). I'm still unable to upgrade my individual / taxable account. I'm wondering if the age of the account has any bearing. My Traditional IRA account was upgraded about a year ago, and was t...
by JoMoney
Fri Aug 08, 2014 9:27 pm
 
Forum: Personal Finance (Not Investing)
Topic: VBS upgrade roll out has started
Replies: 68
Views: 8963

Re: Your Favorite charity organization...? please

A couple people already mentioned: Public Library
by JoMoney
Fri Aug 08, 2014 8:00 pm
 
Forum: Personal Consumer Issues
Topic: Your Favorite charity organization...? please
Replies: 91
Views: 3945

Re: Dividend Strategy Ain't For Everyone

I prefer to be dividend agnostic :) but to play dividend advocate for arguments sake: Dividends may provide information or somehow signal to investors about the 'quality' of a company and it's earnings. It may not be something that can be exploited for higher returns, but if someone was stock pickin...
by JoMoney
Fri Aug 08, 2014 7:42 pm
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10428

Re: International investing. A good call by our mentor.

...On the other hand, this whole argument assumes that international is just as likely to outperform domestic stocks for long periods as the other way around. You might not agree with that. You would be in good company then! That seems to be Warren Buffett's view and maybe Jack Bogle's as well. The...
by JoMoney
Fri Aug 08, 2014 6:17 am
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12275

Re: International investing. A good call by our mentor.

...You can bet that your home country will be on the winning side of the divergence. Or you can get the average for sure by splitting your holdings. If you think that's going to make a difference over your long-term investment horizon, you might take that into consideration. Or if you're somehow av...
by JoMoney
Thu Aug 07, 2014 4:56 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12275

Re: International investing. A good call by our mentor.

...So, is the import-intensity of consumption a relevant (although perhaps minor) additional factor in this discussion?... I'm not sure how one would use that to determine the weighting within the stock portfolio. To the extent that volatility and durability of income stream are important, I would ...
by JoMoney
Thu Aug 07, 2014 6:31 am
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12275

Re: International investing. A good call by our mentor.

...I said paraphrase. If you don't agree that's fine, but I don't see the point of responding to 'paraphrase' by saying 'show me the quote' :D Well it's a bad "paraphrase" and doesn't address any of the reasons he's given for why he doesn't feel it's necessary. And in that regard I'd repe...
by JoMoney
Wed Aug 06, 2014 4:48 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12275

Re: International investing. A good call by our mentor.

...I suspect that what is really going on is that domestic tilters believe in domestic stocks in the same way that value tilters believe in value stocks. They think that American stocks will win the long run because the market hasn't fully appreciated how attractive American stocks are relative to ...
by JoMoney
Wed Aug 06, 2014 8:42 am
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12275

Re: ? Best simple reference to dissuade a day trader

...Warren Buffet himself has said anyone can easily crush the index if he's only trading a few million bucks. Look it up... That certainly doesn't sound like something he's said. I tried 'looking it up', I did see him confirm that the 'scalability' was a factor, and that he thought HE could make 50...
by JoMoney
Tue Aug 05, 2014 4:35 pm
 
Forum: Investing - Theory, News & General
Topic: ? Best simple reference to dissuade a day trader
Replies: 67
Views: 4234

Re: Dividend Strategy Ain't For Everyone

The problem with a total return strategy is what do you do when you have no return? Or if you have a negative return? Dollar cost averaging in reverse during a down market can be devastating to a portfolio. Rick Ferri posted that if retired investors could withdraw only the income generated from a ...
by JoMoney
Tue Aug 05, 2014 7:44 am
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10428

Re: International investing. A good call by our mentor.

...I may be misreading what you (or others) wrote or I may be misunderstanding the effect the opinions I have written. For some reason I keep responding, but I'm not trying to be difficult or argumentative. ... Sorry. It was the edited quote from Johno, that was attributed to Mr.Bogle that I was ob...
by JoMoney
Tue Aug 05, 2014 7:30 am
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12275

Re: International investing. A good call by our mentor.

The main resource is the chapter called "Acres of Diamonds" in Common Sense on Mutual Funds. It's a great story with many morals for me personally, but I do not find it inconsistent with my interpretation of the body Mr. Bogle's words. That said, it has been a while, so a refresher is in ...
by JoMoney
Mon Aug 04, 2014 5:19 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12275

Re: International investing. A good call by our mentor.

...An investor need not have any particular views on which countries are overvalued for this to work. Say you have 50% in US stocks and 40% in developed international and 10% in emerging markets. If there is a run-up in valuations for US stocks, then you will gradually be selling US stocks and buyi...
by JoMoney
Mon Aug 04, 2014 5:07 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12275

Re: International investing. A good call by our mentor.

... That said, if one just wants to make a gut decision paraphrasing John Bogle in the quote above 'that [generally anti-global diversification] is just my view, I love my great country and I believe in it', that is one's right. The potential problem I see is artificially setting the question up as...
by JoMoney
Mon Aug 04, 2014 4:57 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12275

Re: Dogs of the Dow ??

I recently came across two mutual funds that have a bit of history available, but are "balanced funds" holding stocks and cash but use the "Dogs of the Dow" strategy for the equity holdings: HDOGX and HBFBX . I have a chart below comparing them with the Vanguard Balanced fund ( V...
by JoMoney
Mon Aug 04, 2014 7:10 am
 
Forum: Investing - Theory, News & General
Topic: Dogs of the Dow ??
Replies: 21
Views: 2330

Re: International investing. A good call by our mentor.

...Given current valuations, wouldn't it make more sense to buy your exposure to the US market from the purchase of inexpensively priced International companies rather than buying your international exposure through the purchase of premium priced US companies? If what you're saying is true, but hyp...
by JoMoney
Mon Aug 04, 2014 6:14 am
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12275

Re: Arnott's/RAFI 10 year 'expected' returns

And in reality - in real fund results - valuations do in influence future returns, on average. Value, momentum, sector bets, do not. Interesting that you believe valuations influence future returns, but that this doesn't apply to stocks with low valuations. Ok! "Price is what you pay, Value is...
by JoMoney
Sun Aug 03, 2014 4:53 pm
 
Forum: Investing - Theory, News & General
Topic: Arnott's/RAFI 10 year 'expected' returns
Replies: 78
Views: 4618
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