Search found 1380 matches

by packer16
Wed Jul 01, 2020 7:54 am
Forum: Investing - Theory, News & General
Topic: Will ex-US ever revert to good performance? Or is it just a high-risk, low-reward investment?
Replies: 293
Views: 13776

Re: Will ex-US ever revert to good performance? Or is it just a high-risk, low-reward investment?

Has International ever outperformed U.S. to the massive extent that U.S. has outperformed International over the last 10 years? Yes. From 2010 to 2019, ex-US stocks underperformed US stocks by an average of 7.15% per year. From 1965 to 1974, ex-US stocks outperformed US stocks by an average of 7.24...
by packer16
Tue Jun 30, 2020 11:12 am
Forum: Investing - Theory, News & General
Topic: Will ex-US ever revert to good performance? Or is it just a high-risk, low-reward investment?
Replies: 293
Views: 13776

Re: Will ex-US ever revert to good performance? Or is it just a high-risk, low-reward investment?

IMO the big difference is the US is overweight 10% vs. ex-US technology & 2% health care and underweight 5% industrials & 2% financial services.

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by packer16
Mon Jun 22, 2020 10:15 am
Forum: Investing - Theory, News & General
Topic: The long-term bearish case against real estate - both commercial and residential REITs
Replies: 20
Views: 1869

Re: The long-term bearish case against real estate - both commercial and residential REITs

I think residential will continue to do well outside of NYC and maybe in NYC longer term. People will always spend on their house as this an asset that folks can experience & enjoy. The attraction of cities is still there. It is where the networks are, this will not change. Near term some older fol...
by packer16
Mon Jun 22, 2020 10:13 am
Forum: Investing - Theory, News & General
Topic: The long-term bearish case against real estate - both commercial and residential REITs
Replies: 20
Views: 1869

Re: The long-term bearish case against real estate - both commercial and residential REITs

You can make the case that you should have REITs in your portfolio (outside broad cap weighted indices) as they are underweighted in indices which include tradable assets since most of real estate is not tradable.

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by packer16
Sun Jun 21, 2020 4:51 pm
Forum: Investing - Theory, News & General
Topic: The long-term bearish case against real estate - both commercial and residential REITs
Replies: 20
Views: 1869

Re: The long-term bearish case against real estate - both commercial and residential REITs

I think residential will continue to do well outside of NYC and maybe in NYC longer term. People will always spend on their house as this an asset that folks can experience & enjoy. The attraction of cities is still there. It is where the networks are, this will not change. Near term some older folk...
by packer16
Sun Jun 21, 2020 2:42 pm
Forum: Investing - Theory, News & General
Topic: The long-term bearish case against real estate - both commercial and residential REITs
Replies: 20
Views: 1869

Re: The long-term bearish case against real estate - both commercial and residential REITs

I think you need to look at REITs in sectors. Most will do well, towers/hosting/self storage/residential/destination hotels (longer term)/warehouse/manufacturing/biotech & some worse retail (non experiential)/office. The weights in the REITs have already shifted to the favorable sectors so IMO selli...
by packer16
Wed Jun 17, 2020 6:11 pm
Forum: Investing - Theory, News & General
Topic: Value Premium- Does it really exist
Replies: 28
Views: 2065

Re: Value Premium- Does it really exist

It appears that many arguments for the value premium still existing are based upon FOMO versus trying to determine if tell tale chart is better reflection of reality.

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by packer16
Mon Jun 15, 2020 10:57 pm
Forum: Investing - Theory, News & General
Topic: Hertz (bankrupt) may issue new stock
Replies: 74
Views: 6445

Re: Hertz (bankrupt) may issue new stock

The closest analog of a successful purchase of a bankrupt stock was GGP. In that case, there were a few bidders that bid up the estate when it was in bankruptcy. They did not try an equity offering. It does not sound like there is similar interest here. This was during the GFC so the economic backdr...
by packer16
Sat Jun 13, 2020 11:48 am
Forum: Investing - Theory, News & General
Topic: Hertz (bankrupt) may issue new stock
Replies: 74
Views: 6445

Re: Hertz (bankrupt) may issue new stock

because the value of their collateral (rental cars) has increased Thanks for the explanation, better than anything the media has put out. But I don't understand how there could reasonably be a scenario where the value of a rental fleet increases during the bankruptcy period - don't cars depreciate ...
by packer16
Sat Jun 13, 2020 1:09 am
Forum: Investing - Theory, News & General
Topic: Hertz (bankrupt) may issue new stock
Replies: 74
Views: 6445

Re: Hertz (bankrupt) may issue new stock

That is the media's take but I think they are surface level thinkers & do not appear to understand the reason for the BK and the case that if the value of the collateral goes up there is value there. The reason equity gets nothing in BK is they do not have representation in the process. Look at the ...
by packer16
Fri Jun 12, 2020 10:40 pm
Forum: Investing - Theory, News & General
Topic: Hertz (bankrupt) may issue new stock
Replies: 74
Views: 6445

Re: Hertz (bankrupt) may issue new stock

Whether the stock goes the debt holders depends upon whether the equity holders get a committee & the value of the estate increases in value. How can the judge allow the offering without a representation in the restructuring? If the equity holders get a committee then the sub debt trading at 50 cent...
by packer16
Fri Jun 12, 2020 10:09 pm
Forum: Investing - Theory, News & General
Topic: Hertz (bankrupt) may issue new stock
Replies: 74
Views: 6445

Re: Hertz (bankrupt) may issue new stock

My understanding is it will be the same as the current equity.

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by packer16
Fri Jun 12, 2020 9:19 pm
Forum: Investing - Theory, News & General
Topic: Hertz (bankrupt) may issue new stock
Replies: 74
Views: 6445

Re: Hertz (bankrupt) may issue new stock

What is happening is the asset backed securities (backed by the rental fleet) would not agree to a payment deferral because the value of their collateral (rental cars) has increased so the ABS holders felt they would get more value by foreclosing on the cars & selling them versus getting a reduced p...
by packer16
Fri Jun 12, 2020 9:05 pm
Forum: Investing - Theory, News & General
Topic: Managing sequence of returns risk
Replies: 53
Views: 2975

Re: Managing sequence of returns risk

Two other ways are to have an adjustable spending plan replacing fixed costs with variable or diversify cash flow streams. An example is a mortgage which is in essence a fixed savings account which you will not require in retirement. You can also diversify your cash flows streams beyond your investm...
by packer16
Mon Jun 01, 2020 6:16 pm
Forum: Investing - Theory, News & General
Topic: Should one permanently reduce REITs/RE because of COVID-19?
Replies: 18
Views: 2303

Re: Should one permanently reduce REITs/RE because of COVID-19?

If you look at the long-term trend of moving to cities due to network effects on social & job prospects will probably slow down but not stop. Unless extroverts become introverts I think this LT trend will continue in the US as it is around the world today.

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by packer16
Mon Jun 01, 2020 12:37 pm
Forum: Investing - Theory, News & General
Topic: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"
Replies: 21
Views: 3029

Re: Dr. Ed Yardeni is my June podcast guest on "Bogleheads on Investing"

The Fed is operating in the Twilight Zone. It's become a black hole, consuming every asset in sight and distorting market prices. How does it end? Listen to my podcast and Dr. Ed Yardeni as we discuss the unprecedented Fed action of QE Forever! :happy Good podcast. Is Fed a black hole distorting ma...
by packer16
Thu May 28, 2020 8:43 am
Forum: Investing - Theory, News & General
Topic: Stocks are dirt cheap vs. Bonds
Replies: 33
Views: 3747

Re: Stocks are dirt cheap vs. Bonds

IMO the main point here is the incremental return for taking stock risk is close to or higher than it has been historically versus treasuries. This makes sense as folks who hold assets are aging & thus want more safety. Another important point is interest rates have fallen faster than growth rates o...
by packer16
Thu May 28, 2020 8:03 am
Forum: Investing - Theory, News & General
Topic: Stocks are dirt cheap vs. Bonds
Replies: 33
Views: 3747

Re: Stocks are dirt cheap vs. Bonds

Prof. Damodaran has computed the equity risk premium every month via a standardized data-crunching process for the last 10 years. His current estimate is 5.39% (as compared to money markets, not 10-year treasury I think). But there's a big caveat here in that this premium is usually computed via 12...
by packer16
Sat May 23, 2020 11:54 am
Forum: Investing - Theory, News & General
Topic: TIAA warns on negative yields on money market funds
Replies: 71
Views: 5002

Re: TIAA warns on negative yields on money market funds

Wonder what Vanguard is going to do? I'm not waiting to find out. They have stopped new customers from opening new accounts in their treasury MMF. Packer I saw that. I wonder if it had anything to do with the fact that they saw negative yields coming. I think so. The concern was new money had to be...
by packer16
Fri May 22, 2020 10:28 pm
Forum: Investing - Theory, News & General
Topic: TIAA warns on negative yields on money market funds
Replies: 71
Views: 5002

Re: TIAA warns on negative yields on money market funds

CULater wrote:
Fri May 22, 2020 9:37 pm
Wonder what Vanguard is going to do? I'm not waiting to find out.
They have stopped new customers from opening new accounts in their treasury MMF.

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by packer16
Fri May 22, 2020 7:50 pm
Forum: Investing - Theory, News & General
Topic: Yield Curves During Deflation
Replies: 11
Views: 1219

Re: Yield Curves During Deflation

I am in the inflation camp. [OT comment removed by admin LadyGeek] Productivity for essential goods and services will go down significantly. Once the "going out of business" sales are over, look for increased prices in almost everything you buy. I won't even mention taxes which I include in my pers...
by packer16
Tue May 19, 2020 7:09 pm
Forum: Investing - Theory, News & General
Topic: BDREX - broadstone real estate access fund
Replies: 7
Views: 447

Re: BDREX - blackstone real estate access fund

You have to take a look at the underlying investment the fund to assess fees. You are paying fees on fees when you buy a real estate index fund also. The REITs in the REIT index fund holds have fees/costs which you can estimate also. You need to determine the "look through" expense ratio (i.e. the t...
by packer16
Tue May 19, 2020 10:37 am
Forum: Investing - Theory, News & General
Topic: Yield Curves During Deflation
Replies: 11
Views: 1219

Re: Yield Curves During Deflation

If you look at what tipped deflation to inflation in early 1900s and 1930s, it was three things, increased population, war destroying the supply and rising living standards with a fixed supply. Population growth has slowed, war has not destroyed supply, technology has created more supply which has ...
by packer16
Mon May 18, 2020 3:47 pm
Forum: Investing - Theory, News & General
Topic: Yield Curves During Deflation
Replies: 11
Views: 1219

Re: Yield Curves During Deflation

Thanks. That graph is what I saw also. If we assume the market is telling us something versus being manipulated, then would not it not be signalling deflation so low nominal long-term rates make sense. It appears COVID has shaken the pillars of two remaining area of inflation (urban real estate & ed...
by packer16
Mon May 18, 2020 1:55 pm
Forum: Investing - Theory, News & General
Topic: Yield Curves During Deflation
Replies: 11
Views: 1219

Yield Curves During Deflation

I was looking at the times the US/UK has had deflation & in both periods of time the yield curve was inverted most of the time. However, when I looked at the data the comparison was between longer term government bonds and shorter term call money or high grade commercial lenders. Has anyone looked a...
by packer16
Sun May 17, 2020 6:24 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 18558

Re: Rekenthaler: Long Bonds Are for Fools

And they are charging large depositors for the privilege.

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by packer16
Sun May 17, 2020 6:15 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 18558

Re: Rekenthaler: Long Bonds Are for Fools

Unless you are hypothesizing a lower bound that affects long-term yields but not short-term yields, I don't see how you can use a lower bound to argue for a condition in which long-term bonds are LESS volatile than short-term bonds. Also, we're drifting way off topic don't you think? Do we really t...
by packer16
Sun May 17, 2020 5:00 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 18558

Re: Rekenthaler: Long Bonds Are for Fools

Vineviz is correct. No matter what are theories are there is demand for a safe risk-free asset no matter the price. All I was stating is that in an environment of deflation it is not irrational to accept a negative nominal return as long as the real return is positive or slightly negative (to accoun...
by packer16
Sun May 17, 2020 11:07 am
Forum: Investing - Theory, News & General
Topic: Appreciating the magnitude of Sequence of Returns immediately after retirement
Replies: 115
Views: 5972

Re: Appreciating the magnitude of Sequence of Returns immediately after retirement

This is a really great post, and it dovetails with the other ongoing discussion about FIRE. Personally, the importance of the Sequence of Returns Risk is actually why I don't plant to obsess about a really low SWR. Instead, I plan to just accumulate an extra couple years of living expenses and have...
by packer16
Sun May 17, 2020 10:24 am
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 18558

Re: Rekenthaler: Long Bonds Are for Fools

The "Deflation World" argument for low interest rates would make more sense if the low interest rates weren't being manufactured by the Fed. Where would rates be if the Fed wasn't buying most of the Treasuries being issued? Price discovery in markets has become a quaint memory. How do you know they...
by packer16
Sun May 17, 2020 7:44 am
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 18558

Re: Rekenthaler: Long Bonds Are for Fools

How would volatility not be impacted by a constrained lower bound? Unless you are hypothesizing a lower bound that affects long-term yields but not short-term yields, I don't see how you can use a lower bound to argue for a condition in which long-term bonds are LESS volatile than short-term bonds....
by packer16
Sun May 17, 2020 7:29 am
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 18558

Re: Rekenthaler: Long Bonds Are for Fools

IMO I think Rekenthaler is suffering from experience bias. We have not experienced deflation since the 1930s & just about no one alive has experienced deflation but inflation has been experienced by everyone & especially the older of us like Rekenthaler. We had deflation in 2015 briefly, and before...
by packer16
Sat May 16, 2020 10:06 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 18558

Re: Rekenthaler: Long Bonds Are for Fools

IMO I think Rekenthaler is suffering from experience bias. We have not experienced deflation since the 1930s & just about no one alive has experienced deflation but inflation has been experienced by everyone & especially the older of us like Rekenthaler. The 1% rates make sense in a deflationary wor...
by packer16
Mon May 11, 2020 10:55 am
Forum: Investing - Theory, News & General
Topic: Larry Siegel, CFA Institute Research Foundation director and author is my guest on "Bolgeheads on Investing" podcast
Replies: 8
Views: 1330

Re: Larry Siegel, CFA Institute Research Foundation director and author is my guest on "Bolgeheads on Investing" podcast

I listened to the podcast & its sounds like a great message that needs to get out to everyone. This is inline with other great thinkers in this area like Bill Bernstein, Warren Buffett (with his American Tailwind series in his last two annual reports) & John Bogle. Thanks for the interview Rich. Pac...
by packer16
Fri May 08, 2020 12:25 pm
Forum: Investing - Theory, News & General
Topic: Moshe Milevsky Morningstar Podcast
Replies: 2
Views: 328

Re: Moshe Milevsky Morningstar Podcast

Great discussion of mixing human capital with financial & instruments to help investors come to reasonable balance.

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by packer16
Wed May 06, 2020 1:00 pm
Forum: Investing - Theory, News & General
Topic: [Are American markets likely to outperform INTL]
Replies: 237
Views: 16279

Re: American exceptionalism

Dominant countries, economies and stock markets do not last forever. And they're also not usually aware of when their star is fading. From Violet Bonham Carter (in Winston Churchill: An Intimate Portrait ), describing the invulnerability of the British Empire at the start of the 20th century: “The ...
by packer16
Sun May 03, 2020 10:11 pm
Forum: Investing - Theory, News & General
Topic: [Berkshire Hathaway Annual Shareholder meeting]
Replies: 49
Views: 3812

Re: Where's Warren Buffett During This Crisis?

We got our answer about Berkshire and airlines: it unloaded its entire position over the last two months. Even the Guru of "Value Investors" appears to be having problems with his style of "Value Factor" in recent years. Reminds me of the IBM position he sold out of a few years back. I saw a story ...
by packer16
Sun May 03, 2020 4:22 pm
Forum: Investing - Theory, News & General
Topic: [Are American markets likely to outperform INTL]
Replies: 237
Views: 16279

Re: American exceptionalism

One advantage the US with high accumulated wealth ($320k/per person) is the ability to self-fund (& even have a surplus) all capital projects. There are other countries that are in similar circumstances, like Sweden, Switzerland, Australia & Canada (all have wealth >$200k/person). This local saving ...
by packer16
Sun May 03, 2020 2:16 pm
Forum: Investing - Theory, News & General
Topic: The Bottom Line on Factor Investing
Replies: 290
Views: 12703

Re: The Bottom Line on Factor Investing

This is how I view some of this value / growth issue. The market prices risk. Value firms are are riskier businesses; more leveraged, more volatile earnings. Value firms are at greater risk of going out of business in bad times and the stocks get hit extra hard in those bad times. Value stocks refl...
by packer16
Sun May 03, 2020 1:58 pm
Forum: Investing - Theory, News & General
Topic: Bill Bernstein: Why value is dead
Replies: 96
Views: 9089

Re: Bill Bernstein: Why value is dead

“ The idea that the value premium derived from an opposite macroeconomic background to ours today and also before anyone knew about or sought factors will define what the market will do in the future given our low growth, low inflation, low interest rate environment is quite a stretch IMO. The macr...
by packer16
Sat May 02, 2020 3:07 pm
Forum: Investing - Theory, News & General
Topic: Bill Bernstein: Why value is dead
Replies: 96
Views: 9089

Re: Bill Bernstein: Why value is dead

Another way to think it about it is growth stocks have longer duration than value stocks so lower interest rates (which include inflation) should increase the value of growth stocks faster than value stocks.

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by packer16
Sat May 02, 2020 2:15 pm
Forum: Investing - Theory, News & General
Topic: Bill Bernstein: Why value is dead
Replies: 96
Views: 9089

Re: Bill Bernstein: Why value is dead

They should care if they are diversifying into leveraged disrupted companies that have little chances of recovering competitive advantage. Lets look at the 2 largest industries in SCV, energy & banks/finance. Historically, these have not been disrupted, now they are, so looking at the past & expect...
by packer16
Sat May 02, 2020 1:03 pm
Forum: Investing - Theory, News & General
Topic: The Bottom Line on Factor Investing
Replies: 290
Views: 12703

Re: The Bottom Line on Factor Investing

I think people should invest in what they believe in. If you don’t believe in factors, then don’t do it. But I can’t help but notice the double standard between views regarding the various stock factors and the equity premium itself, which is actually another factor. Factor skeptics curiously have ...
by packer16
Fri May 01, 2020 3:51 pm
Forum: Investing - Theory, News & General
Topic: Bill Bernstein: Why value is dead
Replies: 96
Views: 9089

Re: Bill Bernstein: Why value is dead

They should care if they are diversifying into leveraged disrupted companies that have little chances of recovering competitive advantage. Lets look at the 2 largest industries in SCV, energy & banks/finance. Historically, these have not been disrupted, now they are, so looking at the past & expect...
by packer16
Fri May 01, 2020 3:38 pm
Forum: Investing - Theory, News & General
Topic: Bill Bernstein: Why value is dead
Replies: 96
Views: 9089

Re: Bill Bernstein: Why value is dead

Value investing is not dead but value factor investing may be. As a value investor you can deal with disruption in your valuation but as a "value" factor you cannot as there is no disruption parameter you can screen on.

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by packer16
Fri May 01, 2020 3:27 pm
Forum: Investing - Theory, News & General
Topic: Bill Bernstein: Why value is dead
Replies: 96
Views: 9089

Re: Bill Bernstein: Why value is dead

They should care if they are diversifying into leveraged disrupted companies that have little chances of recovering competitive advantage. Lets look at the 2 largest industries in SCV, energy & banks/finance. Historically, these have not been disrupted, now they are, so looking at the past & expecti...
by packer16
Fri May 01, 2020 2:05 pm
Forum: Investing - Theory, News & General
Topic: Bill Bernstein: Why value is dead
Replies: 96
Views: 9089

Re: Bill Bernstein: Why value is dead

I think value factor investing may be dead due to increasing disruption in industries beyond tech. Disruption changes the economics that mean reversion is based upon, namely, that the cheap companies economics will become similar to the expensive companies economics. In the case of disruption, valu...
by packer16
Fri May 01, 2020 1:53 pm
Forum: Investing - Theory, News & General
Topic: Bill Bernstein: Why value is dead
Replies: 96
Views: 9089

Re: Bill Bernstein: Why value is dead

I think value factor investing may be dead due to increasing disruption in industries beyond tech. Disruption changes the economics that mean reversion is based upon, namely, that the cheap companies economics will become similar to the expensive companies economics. In the case of disruption, value...
by packer16
Fri May 01, 2020 1:05 pm
Forum: Investing - Theory, News & General
Topic: Small and Value factors, 16 countries over 25 years
Replies: 7
Views: 680

Re: Small and Value factors, 16 countries over 25 years

Thanks for the study. One observation is value investing is based upon reversion to the mean reversion working (i.e. cheaper stocks having access to the same or similar assets as the more expensive stocks for the economics of these firms to equate). For most companies this has worked over time. Howe...
by packer16
Fri May 01, 2020 10:55 am
Forum: Investing - Theory, News & General
Topic: The Collapse in Global Inflation Expectations
Replies: 106
Views: 6603

Re: The Collapse in Global Inflation Expectations

An interesting insight into future growth (Idea Multiplier) but probably more deflationary then inflationary is the following from Vanguard: https://personal.vanguard.com/pdf/megatrends-acceleration-innovation.pdf IMO inflation will only occur if one of the three conditions of shortages happen: war,...