Search found 36296 matches

by nisiprius
Mon Dec 10, 2018 7:21 am
Forum: Investing - Theory, News & General
Topic: Low need to take risk - decrease allocation to stocks?
Replies: 33
Views: 2364

Re: Low need to take risk - decrease allocation to stocks?

1) I have a real problem with the whole concept of "need" to take risk. You "need" to do something if a bad thing will happen if you fail to do it, but not if you do it. Stock investing does not change the downside much, although (in my opinion a strong argument for it) it doesn't make the downside ...
by nisiprius
Sun Dec 09, 2018 2:01 pm
Forum: Investing - Theory, News & General
Topic: does the 4% withdrawal guideline include dividends?
Replies: 43
Views: 2905

Re: does the 4% withdrawal guideline include dividends?

The 4% rule tells you the total amount you are allowed to withdraw and spend. "Spend" includes what you spend onpaying taxes. It isn't "4% after taxes," it's just 4%. It's your total allowance. It doesn't matter how it comes out of your portfolio--whether it's because you issue a "sell" order, wheth...
by nisiprius
Sun Dec 09, 2018 1:48 pm
Forum: Investing - Theory, News & General
Topic: does the 4% withdrawal guideline include dividends?
Replies: 43
Views: 2905

Re: does the 4% withdrawal guideline include dividends?

But what I am reading above is that you would take 40,000 (4% of 1M) each year regardless of what your portfolio's current value was. Is this a correct interpretation? Not quite. The other part is that you are allowed to put a cost-of-living allowance (COLA) on the amount. You are allowed to pace i...
by nisiprius
Sun Dec 09, 2018 1:34 pm
Forum: Investing - Theory, News & General
Topic: does the 4% withdrawal guideline include dividends?
Replies: 43
Views: 2905

Re: does the 4% withdrawal guideline include dividends?

Yes, it does. This is a complicated and intensely debated topic but let me begin by answering your question as simply as possible. 1) All "safe withdrawal rate" studies are based on the total return of stocks--including dividends, which are part of total return. (Total return is the total of two num...
by nisiprius
Sun Dec 09, 2018 11:32 am
Forum: Personal Consumer Issues
Topic: Christmas Tree Fire: Watered Tree vs. Dry Tree
Replies: 18
Views: 2175

Re: Christmas Tree Fire: Watered Tree vs. Dry Tree

I am bitterly disappointed. Here I was all set to enjoy a spirited discussion between people arguing that it is safer to water them and people arguing it is safer to let them dry out. One can only imagine what it was like in the days when people put candles on trees. At last the candles were lit, an...
by nisiprius
Sun Dec 09, 2018 11:14 am
Forum: Investing - Help with Personal Investments
Topic: SPIA or CD Ladder
Replies: 22
Views: 1684

Re: SPIA or CD Ladder

When I've heard the term SPIA, it has always referred to a life annuity that pays out for life. Such annuities may or may not be also include a "guaranteed term," e.g. ten years, during which the payments are made--to your heirs--if you do not survive. Financially, SPIAs are insurance, which invests...
by nisiprius
Sun Dec 09, 2018 9:35 am
Forum: Investing - Help with Personal Investments
Topic: What am I not getting about the value of TIPS funds?
Replies: 23
Views: 2136

Re: What am I not getting about the value of TIPS funds?

The question becomes how does the government calculate the inflation rate and is it accurate. The Bureau of Labor Statistics is transparent about how it calculates the inflation rate, there is no black-box secrecy involved. During the time period when the MIT Billion Prices Project, which estimates...
by nisiprius
Sun Dec 09, 2018 8:50 am
Forum: Investing - Help with Personal Investments
Topic: Has anyone adjusted their stock allocation on the dip?
Replies: 39
Views: 3209

Re: Has anyone adjusted their stock allocation on the dip?

Not I. I rebalance simply to maintain my desired level of risk, not in the belief of any "rebalancing bonus" or opportunistic incremental gain. It would take an awful lot more than a 10% stock market decline to get me so far below my comfort zone that I would feel that I actually needed to rebalance...
by nisiprius
Sat Dec 08, 2018 7:39 pm
Forum: Investing - Theory, News & General
Topic: International underperformance - how to break it down
Replies: 52
Views: 3816

Re: International underperformance - how to break it down

Maybe this, going back to 1900? 6.4% annualized for US, 4.3% annualized for World ex-US ("international.") It can't all be the FAANGs. Don't let the chart scaling fool you, returns for international stocks were so much less than US that the US chart goes to $10,000 and the World ex-US chart only goe...
by nisiprius
Sat Dec 08, 2018 2:15 pm
Forum: Investing - Theory, News & General
Topic: You already own international stocks with VTSMX etc [Vanguard Total Stock Market]
Replies: 53
Views: 4092

Re: You already own international stocks with VTSMX etc

"You already own international stocks with VTSMX?" No, you don't. https://imgur.com/Ot1n1uE.png I am a skeptic about international stocks--about 20-25% of my stock allocation is international, but I do not think it is of any great importance either way. But I really object to the wording "you alread...
by nisiprius
Sat Dec 08, 2018 12:02 pm
Forum: Investing - Theory, News & General
Topic: Do long-term bonds belong in one's portfolio?
Replies: 138
Views: 5870

Re: Do long-term bonds belong in one's portfolio?

The correlation between long-term bonds and stocks has been about zero, not negative . The idea of a negative correlation is either an urban legend or recency. Or, very likely in my cynical opinion, an oversimplified (and thus false) conceptualization, that arises because it is much easier to explai...
by nisiprius
Sat Dec 08, 2018 10:20 am
Forum: Investing - Theory, News & General
Topic: Do long-term bonds belong in one's portfolio?
Replies: 138
Views: 5870

Re: Do long-term bonds belong in one's portfolio?

This is what doesn't make sense to me. If you have short, intermediate, and long the aggregate duration is intermediate-like. So why not just hold intermediate? When you look at past returns, there isn't much difference between the s, i, l split and all i. I more or less agree with this. Vanguard T...
by nisiprius
Sat Dec 08, 2018 10:11 am
Forum: Investing - Theory, News & General
Topic: Do long-term bonds belong in one's portfolio?
Replies: 138
Views: 5870

Re: Do long-term bonds belong in one's portfolio?

Having lived through the inflation of the 1970s, I cannot imagine voluntarily locking up any really important fraction of my wealth in something that pays me a specific number of dollars at a specific date that's a decade or more away. Briefly, it seems to me that choice depends on what use you want...
by nisiprius
Sat Dec 08, 2018 8:53 am
Forum: Investing - Help with Personal Investments
Topic: Question: Jamie Dimon ( JPMorgan ) on Bonds
Replies: 18
Views: 2179

Re: Question: Jamie Dimon ( JPMorgan ) on Bonds

....I didn't see the interview, but Bloomberg reported that Jamie Dimon said he wouldn't be a buyer of long-term Treasuries at current levels.... This can't be said too often. Vague references to "bonds" in the financial news often mean long-term Treasury bonds (as opposed to "notes" or "bills"), a...
by nisiprius
Sat Dec 08, 2018 7:41 am
Forum: Investing - Help with Personal Investments
Topic: Question: Jamie Dimon ( JPMorgan ) on Bonds
Replies: 18
Views: 2179

Re: Question: Jamie Dimon ( JPMorgan ) on Bonds

Are these Morninstar growth charts before or after expenses? Growth charts, 1-3-5-10 performance numbers, virtually everything you see in mutual fund literature and just about anywhere is after expenses. That is, they represent the number of dollars you really would received if you redeemed the fun...
by nisiprius
Fri Dec 07, 2018 4:01 pm
Forum: Personal Consumer Issues
Topic: What Book Are You Currently Reading? Part VI
Replies: 3448
Views: 1021781

Re: What Book Are You Currently Reading? Part VI

I just received my copy of Stay the Course , but haven't begun it. I'm reading What If?: Serious Scientific Answers to Absurd Hypothetical Questions , by Randall Munroe, author of the XKCD webcomic. It currently on sale as an Amazon Kindle ebook for $2.99. However, my copy cost me $7.99 because I'm ...
by nisiprius
Fri Dec 07, 2018 1:07 pm
Forum: Investing - Help with Personal Investments
Topic: Question: Jamie Dimon ( JPMorgan ) on Bonds
Replies: 18
Views: 2179

Re: Question: Jamie Dimon ( JPMorgan ) on Bonds

More generally, it means that Jamie Dimon says he is not buying bonds and wants you not to buy them, or to sell them. Which is another way of saying he wants to see lower prices on bonds. Which is another way of saying he wants to see higher yields and higher interest rates. Who is his audience? May...
by nisiprius
Fri Dec 07, 2018 1:04 pm
Forum: Investing - Help with Personal Investments
Topic: Question: Jamie Dimon ( JPMorgan ) on Bonds
Replies: 18
Views: 2179

Re: Question: Jamie Dimon ( JPMorgan ) on Bonds

If you had invested $10,000 in the Vanguard Total Bond Market Index Fund on that date, you would now have $12,133. The growth chart looks like this: Help - How do you get a growth chart of a bond/fund/stock that includes distributions? Everything I see is always a price chart. 1) How to use Morning...
by nisiprius
Fri Dec 07, 2018 11:41 am
Forum: Personal Consumer Issues
Topic: Economics and risks of short-term medical insurance
Replies: 1
Views: 165

Re: Economics and risks of short-term medical insurance

I think your questions are their own answer. You are not going to get simple, reliable answers here and probably not anywhere. Everything is going to depend on the exact particulars of the specific policy and the specific condition, and on the insurers' unstated unpublicized policies (do they custom...
by nisiprius
Thu Dec 06, 2018 10:37 pm
Forum: Investing - Help with Personal Investments
Topic: Question: Jamie Dimon ( JPMorgan ) on Bonds
Replies: 18
Views: 2179

Re: Question: Jamie Dimon ( JPMorgan ) on Bonds

On August 18th, 2010, Jeremy Schwartz and Jeremy Siegel wrote an article in The Wall Street Journal saying Ten years ago we experienced the biggest bubble in U.S. stock market history—the Internet and technology mania that saw high-flying tech stocks selling at an excess of 100 times earnings. The a...
by nisiprius
Thu Dec 06, 2018 6:08 pm
Forum: Investing - Theory, News & General
Topic: S&P undulations across time
Replies: 8
Views: 661

Re: S&P undulations across time

...How can anyone look at the run away market over the last several years and feel ok about investing right now?... Never, ever, ever have I personally "felt OK" about investing the stock market. The Bogleheads investment philosophy isn't obvious. Almost everyone starts out by thinking there has to...
by nisiprius
Thu Dec 06, 2018 5:55 pm
Forum: Investing - Theory, News & General
Topic: Why Retirement Is Broken And Needs To Be Reinvented
Replies: 174
Views: 11884

Re: Why Retirement Is Broken And Needs To Be Reinvented

Lack of education didn't create the problem, education isn't going to fix it.
by nisiprius
Thu Dec 06, 2018 4:11 pm
Forum: Investing - Theory, News & General
Topic: Is the division of international markets into "developed" and "emerging" meaningful?
Replies: 16
Views: 1336

Re: Is the division of international markets into "developed" and "emerging" meaningful?

The "market" in "emerging markets" refers to the whole economy or country as a world market for commerce, not to the stock market. "Emerging markets" is a kind of euphemism for what properly should be called "less-developed countries" or even "third-world countries." It is similar to the phrase "'va...
by nisiprius
Thu Dec 06, 2018 11:06 am
Forum: Investing - Help with Personal Investments
Topic: Is a 5-year CD closer in behavior to TIPS or IT?
Replies: 6
Views: 517

Re: Is a 5-year CD closer in behavior to TIPS or IT?

...I have access to a 5-year CD at 3.5% with a two month EWP...I know it isn't truly either, but for the sake of mental accounting, would you think of that CD money more in the Real or Nominal section of Fixed Income? I really don't understand. It seems crystal clear. If it doesn't have "CPI" in th...
by nisiprius
Thu Dec 06, 2018 9:35 am
Forum: Investing - Theory, News & General
Topic: Anybody Miss the Crypto Rage on BH Forums
Replies: 96
Views: 6863

Re: Anybody Miss the Crypto Rage on BH Forums

Stockpiled guano I wouldn’t invest in that $hit :wink: There was a very interesting "100% Invisible" (podcast) on Guano Mania that is well worth listening to (or reading). If you've ever wondered why the United States has all of those scattered possession in the Pacific, that's the answer, with all...
by nisiprius
Thu Dec 06, 2018 8:04 am
Forum: Investing - Theory, News & General
Topic: (NEW) WisdomTree 90/60 U.S. Balanced Fund
Replies: 172
Views: 12235

Re: (NEW) WisdomTree 90/60 U.S. Balanced Fund

This has performed akin to VTI. Remind me: what was it supposed to do? Take your money and put it in their pocket. It's yet another fund with objectives that might be charitably defined as "vague"--according to the prospectus, The WisdomTree 90/60 U.S. Balanced Fund (the “Fund”) seeks total return....
by nisiprius
Thu Dec 06, 2018 7:07 am
Forum: Investing - Theory, News & General
Topic: In Search of... the Inverted Yield Curve
Replies: 33
Views: 3705

Re: In Search of... the Inverted Yield Curve

The Best Investments in Case of an Inverted Yield Curve https://www.google.com/amp/s/www.wsj.com/amp/articles/the-best-investments-in-case-of-an-inverted-yield-curve-1536545041 Also, per this author, 2/10 yr. inversion has correctly saged a recession 7 times in a row since 1969. YMMV 1) I don't thi...
by nisiprius
Wed Dec 05, 2018 10:09 pm
Forum: Investing - Theory, News & General
Topic: Does the Yield Curve Really Forecast Recession?
Replies: 5
Views: 667

Re: Does the Yield Curve Really Forecast Recession?

So, it's a prediction of a prediction. Daily Treasury Yield Curve Rates Date 1 Mo 2 Mo 3 Mo 6 Mo 1 Yr 2 Yr 3 Yr 5 Yr 7 Yr 10 Yr 20 Yr 30 Yr 12/04/18 2.37 2.42 2.42 2.58 2.71 2.80 2.81 2.79 2.84 2.91 3.05 3.16 And given that the standard definition of an "inverted yield curve" appears to be 3 month y...
by nisiprius
Wed Dec 05, 2018 8:35 pm
Forum: Personal Finance (Not Investing)
Topic: Finally some price transparency in cost for Medicare procedures
Replies: 12
Views: 1715

Re: Finally some price transparency in cost for Medicare procedures

It's nonsense, because you often don't know and can't find out the procedure codes until after the procedure is complete . I don't understand the details behind this but I've tried twice, seriously, to do it and gave up both times. Once time it was a MRI, and I was bothered because they wanted me to...
by nisiprius
Wed Dec 05, 2018 7:39 pm
Forum: Investing - Theory, News & General
Topic: Edward Jones a Review and Analysis: Can Edward Jones be Used for a Boglehead Three Fund Portfolio?
Replies: 36
Views: 3554

Re: Edward Jones a Review and Analysis: Can Edward Jones be Used for a Boglehead Three Fund Portfolio?

The big question is whether Edward Jones will leave you alone in peace once you have it set up. Fidelity (yes, Fidelity) and Vanguard have always left me in peace. Before that, I was with Merrill Lynch for some years, then Dean Witter for some years. My portfolio consisted of a conservative portfoli...
by nisiprius
Wed Dec 05, 2018 7:25 pm
Forum: Investing - Theory, News & General
Topic: Anybody Miss the Crypto Rage on BH Forums
Replies: 96
Views: 6863

Re: Anybody Miss the Crypto Rage on BH Forums

By the way, at the time of this writing BTC is trading for $3737 a coin. Remember it was around $20,000 this time last year. How many of your "investments" have lost 80+% in a single year? Individual stocks, maybe. My Bolivar investment isn't looking so hot s/ Remember Thunderball? the total income...
by nisiprius
Wed Dec 05, 2018 7:17 pm
Forum: Investing - Help with Personal Investments
Topic: Which REIT for Portfolio, should I even get one?
Replies: 25
Views: 1940

Re: Which REIT for Portfolio, should I even get one?

I used to have a small allocation to the Vanguard REIT Index Fund, VGSIX, based on Burton Malkiel's strong recommendations in A Random Walk Down Wall Street and his assertion that they had similar return to the rest of the stock market, but low correlation with it. During 2008-2009, REITS tanked wo...
by nisiprius
Wed Dec 05, 2018 11:28 am
Forum: Investing - Theory, News & General
Topic: In Search of... the Inverted Yield Curve
Replies: 33
Views: 3705

Re: In Search of... the Inverted Yield Curve

It seems almost like a tautology. 100% of the time, stock market crashes are preceded by stocks going up. We know the Fed lowers rates to stimulate the economy, then raises rates to control inflation. When rates are increasing, the curve inverts. At some point there will be a recession and rates wi...
by nisiprius
Tue Dec 04, 2018 11:23 pm
Forum: Investing - Help with Personal Investments
Topic: Which REIT for Portfolio, should I even get one?
Replies: 25
Views: 1940

Re: Which REIT for Portfolio, should I even get one?

First, REITs are not the same as an actual direct investment in real estate, so comments on "real estate" as an investment don't necessarily apply. The Talmud was not talking about REIT index funds. I used to have a small allocation to the Vanguard REIT Index Fund, VGSIX, based on Burton Malkiel's s...
by nisiprius
Tue Dec 04, 2018 6:41 pm
Forum: Investing - Theory, News & General
Topic: Any thoughts about defined outcome ETFs?
Replies: 11
Views: 711

Re: Any thoughts about defined outcome ETFs?

Holy cow. Total assets: BJUL $3.76 m illion-with-an-m. PJUL $5.65 m illion. MJUL $5.00 m illion. One completely random web page that showed up when I searched on "minimum etf size" suggests Here are three simple questions to ask of all ETFs, and why they matter for your costs.... Is The Expense Rati...
by nisiprius
Tue Dec 04, 2018 6:30 pm
Forum: Investing - Theory, News & General
Topic: Any thoughts about defined outcome ETFs?
Replies: 11
Views: 711

Re: Any thoughts about defined outcome ETFs?

Regarding "downside protection," I see that the prospectus says You should not consider this investment if: ...you are unwilling to accept the risk of losing your entire investment. What's with that ? Why would any investor who doesn't want to take the risk of losing more than 9% be willing to take ...
by nisiprius
Tue Dec 04, 2018 6:05 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 8505
Views: 1667140

Re: U.S. stocks in freefall

Not seeing much happening... who knows what might happen, but right now, I don't see anything much out of the ordinary...

Image
by nisiprius
Tue Dec 04, 2018 5:54 pm
Forum: Personal Finance (Not Investing)
Topic: Why Is Insurance Worth It (Analytically)?
Replies: 89
Views: 4175

Re: Why Is Insurance Worth It (Analytically)?

1) I don't know whether there's an explanation of it that does not include psychology or utility functions, but most people have opinions about how much risk they are willing to take, and are willing to pay money to reduce that risk. This is familiar in financial economics in the very idea of an "eq...
by nisiprius
Tue Dec 04, 2018 3:59 pm
Forum: Investing - Theory, News & General
Topic: Yield Curve = Inverted
Replies: 58
Views: 5951

Re: Yield Curve = Inverted

...This: ...An inversion of the 2- and 10-year yields has been a reliable recession indicator in the past. Not all inversions have led to a recession, but recessions have always been preceded by inversions, according to Michael Schumacher, the director of rates at Wells Fargo. I'd like to see the d...
by nisiprius
Tue Dec 04, 2018 1:04 pm
Forum: Investing - Theory, News & General
Topic: Bond Inversion! Real estate prices, and more.
Replies: 25
Views: 2119

Re: Bond Inversion! Real estate prices, and more.

nedsaid wrote:
Mon Dec 03, 2018 10:28 pm
I don't know what a secondary recession is.
A secondary recession is when they march out of the church playing Mendelssohn.
by nisiprius
Tue Dec 04, 2018 8:25 am
Forum: Investing - Theory, News & General
Topic: Yield Curve = Inverted
Replies: 58
Views: 5951

Re: Yield Curve = Inverted

Those who believe that inverted yield curves are good predictors of recessions, and that what we are seeing now already qualifies as an inverted yield curve... ...show of hands, please... do you agree that if no recession starts before, say, June 2019, the prediction has been falsified? (Mind you, w...
by nisiprius
Tue Dec 04, 2018 8:17 am
Forum: Investing - Theory, News & General
Topic: Yield Curve = Inverted
Replies: 58
Views: 5951

Re: Yield Curve = Inverted

I just looked at the article more carefully and I can't even tell what they're talking about. They say "The spread between 3- and 5-year yields fell to negative 0.6 basis points Monday." Their numbers seem different from the Treasury's. One basis point is 1/100th of a percent. So 0.6 basis points w...
by nisiprius
Mon Dec 03, 2018 9:10 pm
Forum: Investing - Theory, News & General
Topic: Yield Curve = Inverted
Replies: 58
Views: 5951

Re: Yield Curve = Inverted

Yield curve and GDP growth, November, 2018 Looks like the Cleveland Fed bases these predictions on the difference between the 3-month rate and the 10-year rate, with no other numbers factoring in, and as of November 23rd stated a 13.64% probability of recession: https://imgur.com/xb8bCYq.png I supp...
by nisiprius
Mon Dec 03, 2018 9:00 pm
Forum: Investing - Theory, News & General
Topic: Yield Curve = Inverted
Replies: 58
Views: 5951

Re: Yield Curve = Inverted

Consider the statement "an inverted yield curve predicts a recession." 1) Would some point me to the appropriate and convincing study that says so, and 2) Make clear what definition of "inverted yield curve" is used in that study? For example, does "yield curve" mean the data that is published by th...
by nisiprius
Mon Dec 03, 2018 4:36 pm
Forum: Investing - Theory, News & General
Topic: Yield Curve = Inverted
Replies: 58
Views: 5951

Re: Yield Curve = Inverted

Not according to whatever criteria are used by the website that provides the dynamic yield curve. They say that it's... https://imgur.com/V1K6as2.png ..."normal." True, that's from November 30th. But the Treasury site is showing: Date 1 Mo 2 Mo 3 Mo 6 Mo 1 Yr 2 Yr 3 Yr 5 Yr 7 Yr 10 Yr 20 Yr 30 Yr 12...
by nisiprius
Mon Dec 03, 2018 4:24 pm
Forum: Investing - Theory, News & General
Topic: "The Steak Dinner Annuity Pitch"
Replies: 60
Views: 7151

Re: "The Steak Dinner Annuity Pitch"

Bolderboy, thank you so much for the story you told above, here.
by nisiprius
Mon Dec 03, 2018 1:52 pm
Forum: Investing - Theory, News & General
Topic: Big endowments don't beat simple 60/40 over 10 yrs.
Replies: 25
Views: 3175

Re: Big endowments don't beat simple 60/40 over 10 yrs.

It is a problem of portfolio creep. One can start out with a simple and effective investment strategy but evolve into greater complexity because you keep learning more and want to apply what you learn. Doubtless, the folks on these endowment committees are bright people and don't want to miss out. ...
by nisiprius
Mon Dec 03, 2018 1:50 pm
Forum: Investing - Theory, News & General
Topic: [Understanding volatility in ultrashort bond funds]
Replies: 49
Views: 5210

Re: [Understanding volatility in ultrashort bond funds]

b0B, I don't know whether floating rate bond funds are customarily included in lists of "ultrashort bond funds." Since you've been looking at them, from the thread title and initial reference to FLOT and FLRN, I gather that they are. If I've learned anything at all from this thread, it seems to me t...
by nisiprius
Mon Dec 03, 2018 12:55 pm
Forum: Investing - Help with Personal Investments
Topic: TIPS Mutual Funds for emergency funds
Replies: 8
Views: 866

Re: TIPS Mutual Funds for emergency funds

I've yet to read anything with serious insight or data on the topic of emergency funds. I think bond funds are fine. I include them as a "second tier" when thinking about my emergency fund. With regard to bond funds as emergency funds, there are two issues: having an unplanned exigency force you to ...
by nisiprius
Mon Dec 03, 2018 12:18 pm
Forum: Investing - Theory, News & General
Topic: Big endowments don't beat simple 60/40 over 10 yrs.
Replies: 25
Views: 3175

Re: Big endowments don't beat simple 60/40 over 10 yrs.

They have different goals than individual investors (ie, their horizon is perpetuity rather than double digit years). And thus, as surely as night follows day, their investments differ from individual investors. Yes, that's what people say. Gregory Bateson's regrettably apocryphal story is that Oxf...