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Re: non US bonds - a new asset class?

One aspect I have never liked is the index has the largest weighting to the country with the most debt. Equity funds have the highest weighting to the most valuable companies! That's an interesting statement, but I believe the index represents a weighting of what bonds are on the market. Buyers det...
by patrick
Wed Nov 26, 2014 11:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: non US bonds - a new asset class?
Replies: 8
Views: 327

Re: Valuation of EE Savings Bonds

...My take is that you should value something at what you would be willing to pay for it on the open market, even if that market does not exist... Well, there is an authentic question here. When entering numbers in a spreadsheet, when should I use "the market value" and when should I use ...
by patrick
Wed Nov 26, 2014 9:16 pm
 
Forum: Investing - Theory, News & General
Topic: Valuation of EE Savings Bonds
Replies: 35
Views: 1795

Re: 60/40 edging my 95/5!

This is however due to underperformance of non-US stocks, not the stock/bond split -- 95/5 using SWPPX and VBTLX would have done even better.
by patrick
Tue Nov 25, 2014 10:16 pm
 
Forum: Investing - Theory, News & General
Topic: 60/40 edging my 95/5!
Replies: 8
Views: 1790

Re: Valuation of EE Savings Bonds

In the case of a savings bonds, there is a market. It's just that there is only one buyer, the Treasury. It is not correct to say there is no market price. For an illiquid security, there is no market price, but savings bonds are not illiquid, they are highly liquid, and accurate quotations of the ...
by patrick
Tue Nov 25, 2014 8:45 pm
 
Forum: Investing - Theory, News & General
Topic: Valuation of EE Savings Bonds
Replies: 35
Views: 1795

Re: Valuation of EE Savings Bonds

Mel Lindauer has pointed out that they cannot be used legally as loan collateral, so you cannot tapdance around it that way, either. It is my personal belief that the only sensible dollar value of a savings bond is its current redemption value at the Treasury. And, yes, that means that I truly beli...
by patrick
Tue Nov 25, 2014 8:31 pm
 
Forum: Investing - Theory, News & General
Topic: Valuation of EE Savings Bonds
Replies: 35
Views: 1795

Re: Valuation of EE Savings Bonds

Mutual funds value at the market price. For the EE bond there is no open market and thus no market price.
by patrick
Tue Nov 25, 2014 7:14 pm
 
Forum: Investing - Theory, News & General
Topic: Valuation of EE Savings Bonds
Replies: 35
Views: 1795

Re: Buying a Computer. Need recommendations.

Some web sites are full of bloated scripts that are highly demanding of your computer's resources, but bogleheads.org is fortunately not one of them. Email shouldn't need much either. Unless your other windows open are far more demanding a 4 year old computer shouldn't be that slow, so perhaps the o...
by patrick
Tue Nov 25, 2014 7:07 pm
 
Forum: Personal Consumer Issues
Topic: Buying a Computer. Need recommendations.
Replies: 36
Views: 2132

Re: Buying a Computer. Need recommendations.

I actually think SSDs are nice, but not at all a required feature for a new computer. They do make things slightly faster, but it's not a revelation by any stretch. But if you do decide to go Chromebook, there are Chromebooks with SSD drives. I just found the below one - not at all saying it's the ...
by patrick
Tue Nov 25, 2014 6:46 pm
 
Forum: Personal Consumer Issues
Topic: Buying a Computer. Need recommendations.
Replies: 36
Views: 2132

Re: Moving current 401k funds into brokerage link?

A BrokerageLink can be useful if (a) transactions are large, (b) infrequent and (c) give you a large advantage in expenses. Otherwise fees for use of the BrokerageLink can eat up the expense ratio advantage you try to get. What are the fees for use of the BrokergeLink? There are usually annual fees...
by patrick
Sat Nov 22, 2014 6:50 pm
 
Forum: Investing - Help with Personal Investments
Topic: Moving current 401k funds into brokerage link?
Replies: 30
Views: 1566

Re: Storing/Organizing Memory Sticks

The big advantage of thumb drives is that they're in the same ballpark of cost per gigabyte as rotating drives, they store enough to be useful, but are a small enough chunk that you don't lose "everything" if one of them goes. This doesn't sound right to me. These days the rotating disks ...
by patrick
Sat Nov 22, 2014 6:04 pm
 
Forum: Personal Consumer Issues
Topic: Storing/Organizing Memory Sticks
Replies: 25
Views: 1540

Re: smartphone over wifi - still possible?

The lock on a phone normally prevents using the phone with a different phone network and doesn't limit wifi. However, the phone company might not want to give you a no-data plan if you have a smartphone, though a low-data plan would probably be available.
by patrick
Fri Nov 21, 2014 1:41 am
 
Forum: Personal Consumer Issues
Topic: smartphone over wifi - still possible?
Replies: 31
Views: 2381

Re: GAO Concerned your IRA may be too big!

a dual-professional couple who aggressively saved and invested in qualified 401k (with full employer contributions) beginning upon departure from school is in serious danger of running afoul of the 5,000,000 figure that is a recurring theme of the GAO report. In a country of over 300,000,000 people...
by patrick
Fri Nov 21, 2014 1:19 am
 
Forum: Personal Finance (Not Investing)
Topic: GAO Concerned your IRA may be too big!
Replies: 25
Views: 2771

Re: how to make money like a billionaire

we can go back and forth on this forever... I do not know how T bills are corelated with CDs, you keep quoting T bills and I am not even that familiar with their structure, never bought them and don't intend to buy what I don't understand. I will try to find some CD data going back further, you wan...
by patrick
Fri Nov 21, 2014 12:54 am
 
Forum: Investing - Theory, News & General
Topic: how to make money like a billionaire
Replies: 116
Views: 9547

Re: how to make money like a billionaire

you mean 10 year treasury bond fund? or 10 year treasury, If I bought 10 year treasury in 1940 and I lost on average 2% per year, I would probably not buy another10 year Treasury at that time and keep losing, if you are talking about treasury bond fund that's a different story, I admit bonds have i...
by patrick
Thu Nov 20, 2014 11:30 pm
 
Forum: Investing - Theory, News & General
Topic: how to make money like a billionaire
Replies: 116
Views: 9547

Re: how to make money like a billionaire

my graph shows CDs NET gains after inflation, inflation is taken into account so 3% loss after inflation only happened very few times. I don't pretend to know what happened in Germany in 1920 but they went through 2 wars both of which they lost, and if we are in a war we are fighting for your lives...
by patrick
Thu Nov 20, 2014 10:27 pm
 
Forum: Investing - Theory, News & General
Topic: how to make money like a billionaire
Replies: 116
Views: 9547

Re: how to make money like a billionaire

there are no guarantees, agreed, but the likelihood of dramatic losses from safety of CDs is much lower than likelihood of dramatic losses from equities. As I posted already, as the steps of my ladder mature on annual basis I will reinvest at higher rates when they will become available and they wi...
by patrick
Thu Nov 20, 2014 9:25 pm
 
Forum: Investing - Theory, News & General
Topic: how to make money like a billionaire
Replies: 116
Views: 9547

Re: how to make money like a billionaire

if inflation runs rampant the CD rates will be going up, that's why I got the ladder and every year I will be renewing at a higher return therefore minimizing losses, don't confuse bond funds with CDs, bond funds although relatively safe do lose money, CDs never will lose their principal value, the...
by patrick
Thu Nov 20, 2014 8:14 pm
 
Forum: Investing - Theory, News & General
Topic: how to make money like a billionaire
Replies: 116
Views: 9547

Re: how to make money like a billionaire

great depression was the closest drop to 90% I mention and noone was killing each other... people just lost lots of money and stayed in line is soup kitchens just to eat, I chose 90% loss as a hypothetical example that downside should be accounted for. And in 100% equity portfolio 90% drop means fr...
by patrick
Thu Nov 20, 2014 7:37 pm
 
Forum: Investing - Theory, News & General
Topic: how to make money like a billionaire
Replies: 116
Views: 9547

Re: how to make money like a billionaire

It is all fine and dandy to make hypothetical statements because deep down there is a denial that 90% drop would ever materialize. Picture someone saving all their life and amass about 1M dollar portfolio just before they are ready to retire and be lets say 80% in stocks, 90% drop would mean that t...
by patrick
Thu Nov 20, 2014 2:37 am
 
Forum: Investing - Theory, News & General
Topic: how to make money like a billionaire
Replies: 116
Views: 9547

Re: how to make money like a billionaire

I also agree with you that being too conservative may mean you won't win the game, but it definitely means you won't loose your shirt, and on the flip side, investing in stocks whatever the portion may be, does not guarantee that you will win the game either, quite to contrary, it is enough for one...
by patrick
Wed Nov 19, 2014 7:19 pm
 
Forum: Investing - Theory, News & General
Topic: how to make money like a billionaire
Replies: 116
Views: 9547

Re: how to make money like a billionaire

ArthurO wrote:Real Estate is special because property values although can drop a lot will never go down to zero. land and buildings have inherent value in them.


Real estate investments often involve extensive leverage which means that your net value can go to zero or lower.
by patrick
Wed Nov 19, 2014 7:15 pm
 
Forum: Investing - Theory, News & General
Topic: how to make money like a billionaire
Replies: 116
Views: 9547

Re: Got a new chip & signature cc from USbank: what's the di

Unfortunately the bad guys can still copy the number and use it to buy stuff over the web ...
by patrick
Tue Nov 18, 2014 10:37 pm
 
Forum: Personal Consumer Issues
Topic: Got a new chip & signature cc from USbank: what's the diff?
Replies: 11
Views: 1095

Re: what is the actual value of my tax deferred accounts?

So logistically, let's say I stop working today and I have this 200k in these accounts, what of it is mine and what is uncle sam's? It is unknown and unknowable. Among other things, how that money is taxed depends on where it falls in "the income stack" and that can change a bunch of time...
by patrick
Thu Nov 13, 2014 7:08 pm
 
Forum: Investing - Theory, News & General
Topic: what is the actual value of my tax deferred accounts?
Replies: 53
Views: 3744

Re: Strategies to protect retirement from depressn or long b

pkcrafter wrote:It is interesting to see that this is one of the very few discussions that acknowledges the possibility of such an event. What becomes of the 100%er in such an environment?

Paul


Now if we could additionally acknowledge that a long bear might be accompanied by inflation rather than deflation ...
by patrick
Thu Nov 13, 2014 7:02 pm
 
Forum: Investing - Theory, News & General
Topic: Strategies to protect retirement from depressn or long bear?
Replies: 33
Views: 3722

Re: Company changing 401K provider. Time for in-service r/o?

The collective trust index funds likely have low costs -- I don't think there is a need to avoid moving to them.
by patrick
Mon Nov 10, 2014 11:04 pm
 
Forum: Investing - Help with Personal Investments
Topic: Company changing 401K provider. Time for in-service r/o?
Replies: 17
Views: 1374

Re: For the next year or so, why shouldn't we be in all-cas

It's interesting to note that lots of people have criticized the bond predictions in the first post, but the stock predictions attract far less criticism.
by patrick
Mon Nov 10, 2014 10:58 pm
 
Forum: Investing - Theory, News & General
Topic: For the next year or so, why shouldn't we be in all-cash?
Replies: 54
Views: 6875

Re: Do IBonds make sense living in a high inflation area

I might have missed it but one thing that I have not seen mentioned was that with the current low interest rates and the way the inflation component of the IBond is taxed that you will likely lose purchasing power if you hold them for several decades. To me there are several niches where they might...
by patrick
Sun Nov 09, 2014 10:22 pm
 
Forum: Investing - Theory, News & General
Topic: Do IBonds make sense living in a high inflation area
Replies: 30
Views: 2912

Re: When do you buy a new home computer?

Oh yeah... do NOT upgrade os versions - I see people sludge a reasonable machine by having to have the latest os for no reason :-) Upgrading the OS may not be much of a problem for a relatively recent machine. Assuming that you are running Windows, the last time the system requirements really incre...
by patrick
Fri Nov 07, 2014 7:19 pm
 
Forum: Personal Consumer Issues
Topic: When do you buy a new home computer?
Replies: 52
Views: 4200

Re: Why stay in intermediate term bonds?

patrick: the losses are still small in the grand scheme of things and they start immediately recovering through higher yields; both things that can't be said about stocks. There was indeed a period of about a year when holding short term bonds paid off; add a year on either side and it's gone. The ...
by patrick
Thu Nov 06, 2014 1:46 am
 
Forum: Investing - Theory, News & General
Topic: Why stay in intermediate term bonds?
Replies: 38
Views: 3705

Re: Why stay in intermediate term bonds?

1) From where I'm standing, the numbers look like -4.7% and +1%, respectively. Oops -- the starting date should have been May 2, as it had already fallen a bit by May 6. But after looking a bit more, I see there was an opportunity to lose even more. The loss is 7.4% if you bought on May 2, 2013 and...
by patrick
Thu Nov 06, 2014 12:29 am
 
Forum: Investing - Theory, News & General
Topic: Why stay in intermediate term bonds?
Replies: 38
Views: 3705

Re: Why stay in intermediate term bonds?

Why do you say "threat of rising rates?" Didn't you notice that in 2013 the rate on the 10-year treasury rose from 1.5% to 3%--the right way to look at this is "1.5% rise" which is not huge but meaningful, even though it is tempting to say it doubled. What was the effect on your...
by patrick
Wed Nov 05, 2014 11:23 pm
 
Forum: Investing - Theory, News & General
Topic: Why stay in intermediate term bonds?
Replies: 38
Views: 3705

Re: iBonds at zero % fixed

Right now the marketable TIPS have positive real yield even at 5 years. This 0 percent yield means the I bonds no longer can beat TIPS on yield. EE bonds seem more interesting now as they still beat regular treasuries if held 20 years, though I am not really a fan of nominal fixed income in general.
by patrick
Wed Nov 05, 2014 8:37 pm
 
Forum: Investing - Theory, News & General
Topic: iBonds at zero % fixed
Replies: 84
Views: 8984

Re: Oil and or Metals?

...I am thinking of taking a tiny percent of my portfolio in assets that do not trade with stocks and bonds. Mainly metals and oil via 2 vanguard sector funds... (Puzzled) What funds are those? And by "metals" do you mean "metals," or "precious metals?" As far as I kno...
by patrick
Wed Nov 05, 2014 6:54 pm
 
Forum: Investing - Theory, News & General
Topic: Oil and or Metals?
Replies: 19
Views: 1169

Re: Comparing Total Returns of Top CD Offerings with an S&P

rolling 30 years returns of 60/40 split stock/bond portfolio shows that it is not uncommon to have only 1% real return with high volatility, and CDs also show sometimes 1% real return which is guaranteed. Of course if one gets lucky (yes I said LUCKY) and markets do well over 30 years, the returns ...
by patrick
Mon Nov 03, 2014 6:48 pm
 
Forum: Investing - Theory, News & General
Topic: Comparing Total Returns of Top CD Offerings with an S&P 500
Replies: 38
Views: 2185

Re: BND or a CD

I think that you and mpt follower are completely missing my point. So, let me try to make it clearer: ⋅  As an investor, my horizon is not exactly 10 years from now. ⋅  I do not hold fixed income in a bucket; I use my fixed income in a buy/hold/ rebalance mixed portfolio of stoc...
by patrick
Sun Nov 02, 2014 5:09 pm
 
Forum: Investing - Theory, News & General
Topic: BND or a CD
Replies: 119
Views: 9685

Re: The Euro-Boglehead way of Bonds

US Treasuries are in my opinion a screaming, pound-the-table buy relative to any Euro zone sovereign bonds at present. German ten year bonds are yielding 1.7% less than 10 year Treasuries, which is more than 3 times the German bonds yield (less than 0.5%). As for the currency issue, most expect tha...
by patrick
Sun Nov 02, 2014 1:56 pm
 
Forum: Investing - Theory, News & General
Topic: The Euro-Boglehead way of Bonds
Replies: 24
Views: 2265

Re: Blog: Harry Browne's Permanent Portfolio

"Considering the S&P 500 actually gained 138% over the past 13 years, while total bond market only gained 84%, along with the fact that the buy-and-hold crowd never claimed that 13 years of stock underperformance was impossible anyway, perhaps it is a different crowd which ought to begin t...
by patrick
Sat Nov 01, 2014 10:25 pm
 
Forum: Investing - Theory, News & General
Topic: Blog: Harry Browne's Permanent Portfolio
Replies: 79
Views: 8018

Re: Blog: Harry Browne's Permanent Portfolio

I'm anything but a gold bug you guys, but considering gold's performance (cited above) as well as the robust performance of the Permanent Portfolio (beating the S&P 500 since 1972 with far less volatility and infinitely lower drawdowns during stock market crashes) I think Bogle and Buffett have...
by patrick
Sat Nov 01, 2014 9:30 pm
 
Forum: Investing - Theory, News & General
Topic: Blog: Harry Browne's Permanent Portfolio
Replies: 79
Views: 8018

Re: Possibility of financial markets breakdown / transformat

A long time ago I picked up a bit of trivia about how banks and security firms value their assets--- Mark to Market. But Insurance companies argued that their clients and insurance assets are different because in order to determine risk you have to look and hold long term. --- Life and Annuity comp...
by patrick
Fri Oct 31, 2014 7:30 pm
 
Forum: Investing - Theory, News & General
Topic: Possibility of financial markets breakdown / transformation?
Replies: 16
Views: 1806

Re: BND or a CD

Help me understand: Assume I purchase shares of BND today when the SEC yield is 2% and the duration is 5.5 years. If I wait that duration and reinvest all dividends (excluding any taxes), should I not expect to get about 2% annually at the end? Not necessarily. If you buy it today (or probably tomo...
by patrick
Fri Oct 31, 2014 7:28 pm
 
Forum: Investing - Theory, News & General
Topic: BND or a CD
Replies: 119
Views: 9685

Re: Total World Fund - Under appreciated?

I thought small caps were included as it was an all cap fund (except they are included at market weights) While on the topic, if you were to have a 50/50 allocation domestic/international - would it make more sense for rebalancing purposes to keep them separate? While I know the cap weighting will ...
by patrick
Fri Oct 31, 2014 7:09 pm
 
Forum: Investing - Help with Personal Investments
Topic: Total World Fund - Under appreciated?
Replies: 26
Views: 2884

Re: Is $700,000 enough to retire? Opinions please .

The vast majority of retirees make do with far less.
by patrick
Fri Oct 31, 2014 8:33 am
 
Forum: Investing - Help with Personal Investments
Topic: Is $700,000 enough to retire? Opinions please .
Replies: 86
Views: 12499

Re: BND or a CD

Help me understand: Assume I purchase shares of BND today when the SEC yield is 2% and the duration is 5.5 years. If I wait that duration and reinvest all dividends (excluding any taxes), should I not expect to get about 2% annually at the end? Not necessarily. If you buy it today (or probably tomo...
by patrick
Thu Oct 30, 2014 10:53 pm
 
Forum: Investing - Theory, News & General
Topic: BND or a CD
Replies: 119
Views: 9685

Re: Total World Fund - Under appreciated?

While Total World is cheap compared to the average fund, it is still more expense than covering the total world by a combination of Total US and Total International. [ Edited to remove incorrect information ]
by patrick
Thu Oct 30, 2014 10:15 pm
 
Forum: Investing - Help with Personal Investments
Topic: Total World Fund - Under appreciated?
Replies: 26
Views: 2884

Re: Schwab expands no commission ETFs-no early sell fee

Well, at least this makes me feel a little better about costing Schwab so much money in ATM fees while never giving them any commissions. I still think they're deep in the red with my account.... I assure you they are not in the red. Have you looked at the fees they charge for money market funds? R...
by patrick
Thu Oct 30, 2014 9:22 pm
 
Forum: Investing - Theory, News & General
Topic: Schwab expands no commission ETFs-no early sell fee
Replies: 42
Views: 3211

Re: How to calculate rate of return on cash value life insur

The 6.5% value is probably the dividend rate based on the cash value, which is certainly not the same as what is meant by an interest rate in other circumstances. It looks like you have been putting money in for about 26 years, which means you have put in about $4290 in total. Assuming that you have...
by patrick
Thu Oct 30, 2014 9:12 pm
 
Forum: Personal Finance (Not Investing)
Topic: How to calculate rate of return on cash value life insurance
Replies: 7
Views: 867

Re: MS Windows 7 Dead [in 2020]?

The linked article was actually about the end of sales of new OEM licenses, not the end of support, although I have read end of support panic over Windows 7 elsewhere. If you want something to worry about, note that Windows Server 2003 extended support ends next year, and Vista extended support ends...
by patrick
Wed Oct 29, 2014 5:27 pm
 
Forum: Personal Consumer Issues
Topic: MS Windows 7 Dead [in 2020]?
Replies: 26
Views: 2247

Re: Global Equity Markets — 40 Years of Evolution at a Glanc

International investing was possible for US investors long ago. According to http://investor.shareholder.com/jpmorganchase/releasedetail.cfm?ReleaseID=239889 the first ADR (from the UK) was listed in New York in 1927. Although I couldn't find anything about this in a quick Google search, it might al...
by patrick
Mon Oct 27, 2014 2:42 am
 
Forum: Investing - Theory, News & General
Topic: Global Equity Markets — 40 Years of Evolution at a Glance
Replies: 10
Views: 1406

Re: Who says a stock is either "value" or "growth"?

The distinction of growth and value isn't quite the same as a prediction as to which companies are undervalued. You might expect a "value" company to outperform because it is a good value, but you'd also expect a "growth" company to outperform because it is going to grow! The res...
by patrick
Sun Oct 26, 2014 6:42 pm
 
Forum: Investing - Theory, News & General
Topic: Who says a stock is either "value" or "growth"?
Replies: 25
Views: 2128

Re: So you think you're a Risk-taker?

If you can't remember 2008-2009, then do your best to remember 2011, the year behavioral finance expert Cass Sunstein "seeing a decline in [my] fund’s value, decided to sell a significant chunk," and did so, despite talking to his co-author who told him "Reread our book!" But if...
by patrick
Sun Oct 26, 2014 5:23 pm
 
Forum: Investing - Theory, News & General
Topic: So you think you're a Risk-taker?
Replies: 36
Views: 4075
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