Search found 995 matches

by eurowizard
Fri Feb 12, 2010 8:23 pm
Forum: Investing - Theory, News & General
Topic: Contraction of Global Economy
Replies: 5
Views: 1227

The easiest way to consider that the law of conservation of money is a false belief, is what if everyone on Earth but ONE person died. What would the value of the money be? Nothing - because the last person would have no one to trade it to. I believe the total global economy is based on people's con...
by eurowizard
Fri Feb 12, 2010 4:50 pm
Forum: Personal Finance (Not Investing)
Topic: Excess Roth Contributions - what do I do?
Replies: 5
Views: 2107

I would recharacterize so that you avoid the penalty and also so you get to "max out" your tax-sheltered space for 2009. Additionally, consider yourself "lucky" that you had a windfall of money and aren't Roth IRA eligible. Unless you made yourself ineligible by a few dollars, then it's likely your ...
by eurowizard
Fri Feb 12, 2010 4:47 pm
Forum: Investing - Theory, News & General
Topic: Contraction of Global Economy
Replies: 5
Views: 1227

Contraction of Global Economy

I'm a believer in Harry Brown's Permanent Portfolio. I noticed that Gold and Stocks both went down pretty big the last 6 weeks and LT bonds barely went up. I wonder what would happen if there was a global contraction of the economy. Would nothing be safe? The global economy is NOT a zero sum game. I...
by eurowizard
Thu Feb 11, 2010 4:41 pm
Forum: Investing - Theory, News & General
Topic: Keeping OLD Tax Records (esp Roth IRA Contributions)
Replies: 20
Views: 6300

FYI - Apparently each IRA custodian sends the IRS a form 5498 every May to list all the IRA contributions made. I've never seen one of these before. My taxes always get filed well before May and anything that comes tax-wise I have shredded without really much thought. I called Vanguard and they said...
by eurowizard
Thu Feb 11, 2010 8:36 am
Forum: Investing - Theory, News & General
Topic: Keeping OLD Tax Records (esp Roth IRA Contributions)
Replies: 20
Views: 6300

Keeping OLD Tax Records (esp Roth IRA Contributions)

Does it make sense to keep really old Tax Records, including Roth IRA Contributions? My concern is that 50 years from now, I'll start pulling money from my Roth IRA and the IRS will say "prove that you legitimately contributed that money" which would involve showing I had an income that year and sho...
by eurowizard
Thu Feb 11, 2010 8:33 am
Forum: Investing - Theory, News & General
Topic: Small Cap International YTD 2.5% Higher than Large Cap Int.
Replies: 12
Views: 1902

Small Cap International YTD 2.5% Higher than Large Cap Int.

Normally Small Cap is supposed to do more poorly than Large Cap in downturns, but YTD it's about 2.5% higher than Large Cap International.

Is this because Small Cap took a huge crap the last week of 2009 so the 2010 downside was nominal? Or just plain old diversification is back?
by eurowizard
Sat Jan 30, 2010 7:37 pm
Forum: Investing - Theory, News & General
Topic: Do brokers earn a profit on commission-free trades?
Replies: 11
Views: 2394

Perhaps the 100 free trades must be executed online without the assistance of a broker?

If not, then perhaps WF still gives broker's their commissions, and then considers this expense. Thus, the value of you keeping $25k+ at the company is worth the commission expense of 100 free trades.
by eurowizard
Sat Jan 30, 2010 10:14 am
Forum: Investing - Theory, News & General
Topic: Schwab Total Market Index Fund
Replies: 20
Views: 6971

Even if some companies offer one or two good equity index funds, no one offers cheap bond funds and cash funds like Vanguard. Everyone needs some good bond funds in their portfolio. Just stay with Vanguard. Vanguard's cash funds are horrible. Alliant CU has been paying 2% interest for the last 7 mo...
by eurowizard
Fri Jan 29, 2010 11:45 pm
Forum: Investing - Theory, News & General
Topic: Asian Options
Replies: 8
Views: 1754

If I had an Asian option it would be a Vietnamese girlfriend.
by eurowizard
Fri Jan 29, 2010 8:44 pm
Forum: Investing - Theory, News & General
Topic: Schwab Total Market Index Fund
Replies: 20
Views: 6971

I say get the Vanguard, forget the Schwab. But I admit that is based on my belief that Schwab will raise the expense ratio at some point. Currently Schwab is only subsidizing 0.03% of the ER on their TSM fund. How could they raise the cost? It only costs them 0.12% normally to run so if they stoppe...
by eurowizard
Fri Jan 29, 2010 7:51 pm
Forum: Investing - Theory, News & General
Topic: Schwab Total Market Index Fund
Replies: 20
Views: 6971

Simba,

Would you suggest then that for tax-sheltered accounts that Schwab's fund is superior and for Taxable accounts, VGs fund is better?
by eurowizard
Thu Jan 28, 2010 10:01 pm
Forum: Investing - Theory, News & General
Topic: Schwab Total Market Index Fund
Replies: 20
Views: 6971

Simba thanks for posting that. Interesting how the two funds diverge, in some years VG wins and in some Schwab wins. There is definitely a greater divergence in performance than the few basis points of ER difference.
by eurowizard
Thu Jan 28, 2010 5:27 pm
Forum: Investing - Theory, News & General
Topic: Schwab Total Market Index Fund
Replies: 20
Views: 6971

Schwab Total Market Index Fund

I recall reading that Schwab's TSM fund wasn't as good as VGs because it didn't actually hold all 5000 stocks. I was looking at their website and the ER is 0.09% (which I already knew) but the expense before waiver is only 0.12% I was under the impression that Schwab was waiving more than 0.03% and ...
by eurowizard
Wed Jan 27, 2010 5:16 pm
Forum: Investing - Theory, News & General
Topic: The Big VIG
Replies: 9
Views: 2833

VIG is horrible as are any "dividend" indexes. People who invested in them literally lost their shirts the last 2 years, because financials cut their dividends, were subsequently removed from the dividend index, and thus the losses were locked in, and index shareholders did not participate in the re...
by eurowizard
Tue Jan 26, 2010 8:12 pm
Forum: Investing - Theory, News & General
Topic: I-bonds--which banks sell in San Francisco area
Replies: 18
Views: 2819

I doubt it's a conspiracy to get you. It's likely the line-level employees have no idea what goes on at other branches and usually dont know everything that goes on at their branch. It's an organizational training issue and having everyone up to speed on what goes on, costs money.
by eurowizard
Tue Jan 26, 2010 9:03 am
Forum: Investing - Theory, News & General
Topic: Beware the 4 new asset bubbles
Replies: 17
Views: 3677

HardKnocker wrote: Will Brad and Angelina break up? Yes. When? Dunno.
I sure hope not!
by eurowizard
Mon Jan 25, 2010 11:03 pm
Forum: Investing - Theory, News & General
Topic: Schwab has Great Customer Service
Replies: 25
Views: 3700

So you have margin trading enabled in your account? Do you make use of that? I dont think I have margin trading on my account. Technically I think my taxable brokerage account went to minus $5, not minus $20k. Just because it only charges the $9 commission, and the $20k would take 3 days to clear. ...
by eurowizard
Mon Jan 25, 2010 8:40 pm
Forum: Investing - Theory, News & General
Topic: Schwab has Great Customer Service
Replies: 25
Views: 3700

Schwab has Great Customer Service

I closed out my old 401k with about $20k and moved it to Schwab rather than VG - mainly because I already have a small portion of my IRA at Schwab and my 401k had Schwab's info on file, so I did the rollover in seconds online. The money cleared today so I made a purchase of a VG ETF to get back to m...
by eurowizard
Sat Jan 23, 2010 10:13 am
Forum: Investing - Theory, News & General
Topic: Wellesley in taxable?
Replies: 6
Views: 2748

I am positive that the 10% tax bracket expires this year, so you will be in the 15% bracket.
by eurowizard
Fri Jan 22, 2010 3:57 pm
Forum: Investing - Theory, News & General
Topic: New Change--Vanguard Subsequent Investment Minimum ($1)
Replies: 44
Views: 9812

I dislike this change. This is going to increase VG's costs and this increase the ER. Vanguard is NOT a low level investor friendly company, nor should it be. Schwab is shifting it's focus towards that goal and theres no way VG can be both a low ER company and a low-level investor firm. That's strad...
by eurowizard
Fri Jan 22, 2010 3:15 pm
Forum: Investing - Theory, News & General
Topic: Why is TSM so cheap?
Replies: 21
Views: 4995

I didn't realize that brokerage/trading commissions are not reflected in ERs. If that's the case, then why not choose SP500 fund over TSM when costs are concerned? The SP500 should have lower hidden commissions. You lose diversification of 5000 stocks, but SP500 makes up 80% of TSM and has around 98...
by eurowizard
Fri Jan 22, 2010 11:10 am
Forum: Investing - Theory, News & General
Topic: Why is TSM so cheap?
Replies: 21
Views: 4995

Why is TSM so cheap?

How is TSM so cheap with respect to ERs?

I would think that buying 5000 stocks is more expensive than buying 500, but the ERs of the SP500 fund are the same as TSM.

How does this work?
by eurowizard
Fri Jan 22, 2010 11:09 am
Forum: Investing - Theory, News & General
Topic: "DFA to Offer Investment Strategies via Brokers"
Replies: 36
Views: 5825

If DFA wasn't so exclusive then no one would want it. They can't open up an ETF. Advisors getting money from clients for access to "exclusive" DFA funds don't want them opened up. Once the end home user can buy something, they don't want it anymore. People want what they cant have. How many people s...
by eurowizard
Thu Jan 21, 2010 9:29 pm
Forum: Investing - Theory, News & General
Topic: Anyone own a Berkshire A share?
Replies: 2
Views: 1059

Anyone own a Berkshire A share?

Just curious if anyone here owns any?
by eurowizard
Thu Jan 21, 2010 12:15 am
Forum: Investing - Theory, News & General
Topic: How much do Vanguard executives make?
Replies: 30
Views: 14922

verboten topics

I thought CEO compensation was verboten topic on the forums? Interesting how some approve of high paying VG executives to "retain top talent" yet disapprove of banks having high paid compensation. Discussing CEO compensation is OK as long as it does not get into bailouts or general political/econom...
by eurowizard
Wed Jan 20, 2010 1:11 pm
Forum: Investing - Theory, News & General
Topic: Vanguard "Pooling" Household Accounts For Investor
Replies: 14
Views: 3308

Vanguard "Pooling" Household Accounts For Investor

I'd like to hear your experience in getting VG to allow you to pool househouse accounts to increase your status to voyager/etc levels. I believe the wording is immediate family members in the same house. Unfortunately between myself and my father we both have over $100k but he lives in another state...
by eurowizard
Wed Jan 20, 2010 12:17 pm
Forum: Investing - Theory, News & General
Topic: Why are bank and money market rates dropping?
Replies: 25
Views: 5640

Without being political, I believe the reduced rates are due to proposed increased taxation on banks and CC reform bills. Both cut into the banks bottom line and thus they need to reduce the yield to maintain the same level of profits. If you or anyone else can do better in the current legislative e...
by eurowizard
Tue Jan 19, 2010 11:41 pm
Forum: Investing - Theory, News & General
Topic: Zero Coupon Canadian RRBs for US Investors
Replies: 3
Views: 879

Zero Coupon Canadian RRBs for US Investors

Can a US brokerage account hold a zero coupon Canadian RRB? I know you can buy international securities for a little extra fee, and assume RRBs should be accessible through this means. Then in 20 or 30 years upon maturity, should be my retirement and ready to go with the full return in one chunk. I'...
by eurowizard
Tue Jan 19, 2010 11:03 pm
Forum: Investing - Theory, News & General
Topic: Take the free money or not?
Replies: 49
Views: 8717

Doc,

Thanks again for the Private Message help earlier today.

Based on what you wrote, it sounds like my advice is NOT to do it. It's probably going to be fine, but for $400 which is $300 after tax, is it really worth the stress of worrying about it?
by eurowizard
Tue Jan 19, 2010 10:51 pm
Forum: Investing - Theory, News & General
Topic: When Is VG Worth It? What Minimum Level Of Money?
Replies: 8
Views: 2463

When Is VG Worth It? What Minimum Level Of Money?

I'm aware that VG accounts can be opened with small amounts of money of even $1k for the STAR fund. However with Schwab really pushing to the smaller investor, it seems like it may be a better place until some has a few hundred thousand dollars. Sure Schwab can change its policies again in a few yea...
by eurowizard
Sun Jan 17, 2010 1:15 pm
Forum: Investing - Theory, News & General
Topic: Is VG Minimum Fund Balance Requirement $3K or $1K?
Replies: 9
Views: 1725

I think in a taxable account the minimum is $1k and in an IRA there is no minimum. I keep $50 in my IRA Prime MMF and they havnt said anything. I had $900 in my taxable muni bond fund and they threatened to close it in 2 months unless I brought above $1k so I just closed it. I think the IRA requires...
by eurowizard
Sat Jan 16, 2010 3:19 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Tax Form System is GARBAGE!
Replies: 6
Views: 1396

Vanguard Tax Form System is GARBAGE!

VG has some crazy proprietary servlet FDF tax form system that wont let me download them. Yes I am using a Mac, but we now have something around 10% of the market share of home computer users so if they want to alientate 10% of their customers who jump ship and leave, so be it. I imagine a couple gu...
by eurowizard
Sat Jan 16, 2010 1:18 pm
Forum: Investing - Theory, News & General
Topic: "Why Many Investors Keep Fooling Themselves"
Replies: 35
Views: 5887

Taxes shouldnt be considered in this because it's our civic duty to pay them to continue operations of the country.
by eurowizard
Thu Jan 14, 2010 11:03 pm
Forum: Investing - Theory, News & General
Topic: True currency when Armageddon hits...
Replies: 26
Views: 4211

The funny thing is that the people who say "I hope I'm dead for that" or "I'll just kill myself" or "I dont want to live on baked beans forever" are going to be BEGGING people who have stored food for help and then calling them a-holes when they wont share and threaten to shoot them if they don't le...
by eurowizard
Thu Jan 14, 2010 12:17 pm
Forum: Investing - Theory, News & General
Topic: Vanguard New Year-end Statement Format POLL
Replies: 21
Views: 4270

I shred my year end paper statements as soon as I get them. PDF files are so much better.
by eurowizard
Thu Jan 14, 2010 12:16 pm
Forum: Investing - Theory, News & General
Topic: Proof That Active Beat Passive?
Replies: 58
Views: 8965

Re: Proof That Managed Beats Index?

grayfox wrote: They all had the same lousy stock market, the same bond market and are all low-cost Vanguard funds. The only difference is Wellesley and Wellington are actively managed and Balanced Index is not.
False.
by eurowizard
Thu Jan 14, 2010 10:56 am
Forum: Investing - Theory, News & General
Topic: State Pension Fund Rules Change
Replies: 0
Views: 548

State Pension Fund Rules Change

I worked for the state of Florida for several years and accumulated about $20k in the state retirement plan. My employer contributed 9% of my salary every month to this state plan. There are 2 options for this FRS plan - one is pension and other is investment. I knew I wasn't going to remain employe...
by eurowizard
Tue Jan 12, 2010 10:49 am
Forum: Investing - Theory, News & General
Topic: Tax-Adjusted AA - What withdrawal tax rates do you use?
Replies: 8
Views: 1383

40% on tax-deferred accounts 20% on Roth IRAs The Roth income may push your SS and/or tax-deferred distributions into the next tax bracket, so I like to consider this penalty as part of the Roth. Also there may be a VAT instituted. I dont turn 60 for over 30 years and the government is going to have...
by eurowizard
Mon Jan 11, 2010 5:31 pm
Forum: Investing - Theory, News & General
Topic: Does a bonds yield = risk?
Replies: 5
Views: 1343

If you compare two bonds with the same call option, same duration/maturity, same liquidity, then the interest rate, all else equal, is determined by risk. In fact, the market prices bonds using this principle by comparing one bond to another based on the relative risk and then adds a higher or lower...
by eurowizard
Mon Jan 11, 2010 5:21 pm
Forum: Investing - Theory, News & General
Topic: S&P down 8.53% today? What the heck???
Replies: 48
Views: 14090

Re: follow up question

Dan Moroboshi wrote: My million dollar equity portfolio is 100% in a leveraged CVS toothpaste index ETF, so I am getting a kick out of this reply.
Interesting. I'm holding the inverse leverage CVS toothpaste index ETF at 130% of my portfolio (purchased on margin).
by eurowizard
Wed Jan 06, 2010 9:35 pm
Forum: Investing - Theory, News & General
Topic: Dealing with Debt in your AA
Replies: 9
Views: 1661

Assuming everything was in a taxable account absolutely pay down the debt. 8% cost vs probably a 1% yeild on the MM. If you ever need liquidity in a pinch thats what margin or depending on the situation, a stock sale is for. In my case its 100% in a tax-deferred account and I dont want to lose the ...
by eurowizard
Wed Jan 06, 2010 10:52 am
Forum: Investing - Theory, News & General
Topic: ACH Delays VG Purchase
Replies: 10
Views: 1894

Re: ACH Delays VG Purchase

I researched buying gold in the past, and all of those sites lock in the price of gold on the day you place the order and you have a week to send the funds. Why does VG not lock in my price on the day I place my order? It's hard to believe this is a serious question. Good Morning, It's common pract...
by eurowizard
Wed Jan 06, 2010 10:18 am
Forum: Investing - Theory, News & General
Topic: ACH Delays VG Purchase
Replies: 10
Views: 1894

ACH Delays VG Purchase

I put in a buy order of $5k of small cap international for my 2010 IRA on Jan 1st. Theoretically it would execute Jan 4th at the closing price. The money was coming from my outside checking account so it takes 2 business days to ACH. It cleared today, Jan 6th, but using Jan 5th prices, which were 1%...
by eurowizard
Wed Jan 06, 2010 1:37 am
Forum: Investing - Theory, News & General
Topic: Dealing with Debt in your AA
Replies: 9
Views: 1661

I wouldn't change the AA but 8% is hard to get even with equities over time so would personally pay off the loan ASAP without incurring withdrawal penatlies. This is possible using Roth IRA money but then you would lose the tax-advantaged space forever. You also lose the ability to remain liquid to...
by eurowizard
Tue Jan 05, 2010 7:21 pm
Forum: Investing - Theory, News & General
Topic: Selfishness and Vanguard
Replies: 5
Views: 1925

Selfishness and Vanguard

I dont mean to call out any individual posters and this is not my intent to do so. For the most part, I dont even look at people's name when I read the posts. I notice a trend of selfishness when it comes to VG fund use. When some people come in with low levels of money, people complain that doing t...
by eurowizard
Tue Jan 05, 2010 6:53 pm
Forum: Investing - Theory, News & General
Topic: Dealing with Debt in your AA
Replies: 9
Views: 1661

Dealing with Debt in your AA

When it comes to Student Loans and Mortgages, and today's low bond and savings account yields, does it make sense to maintain your AA and still pay this debt? Suppose you owed 8% student loan interest and had $100k portfolio that was 80/20. The bond portion of your portfolio is only yielding 4%. Wou...
by eurowizard
Tue Jan 05, 2010 11:21 am
Forum: Investing - Theory, News & General
Topic: Is too much Vanguard a bad thing?
Replies: 9
Views: 2806

Personally I like to go by the rule of 3s. 2 is 1, and 1 is none. I like a backup so I have 3 of everything. In my case, I keep 50% of my portfolio in Vanguard, 10% at Schwab, and 40% in a state-sponsored retirement system. Eventually I would like this to be: 25% Alliant - in High Yield Savings Roth...
by eurowizard
Tue Jan 05, 2010 1:17 am
Forum: Investing - Theory, News & General
Topic: Resetting Taxable Cost Basis Every Few Years
Replies: 39
Views: 5041

I think it is nearly impossible for taxes to increase enough for this to be the right move. As an example: Let's say you have $1000 now worth $1500 so you have a $500 gain. If you realize the gain and pay 15% tax or $75. Now, if the returns are 5% over the next 40 years, that $75 could become: $75*...
by eurowizard
Mon Jan 04, 2010 12:21 pm
Forum: Investing - Theory, News & General
Topic: Reminder on Stock Valuations and Pricing
Replies: 9
Views: 1533

Re: Reminder on Stock Valuations and Pricing

What about this example. A person buys a home in 2007 for $500K. He still owns the home (it hasn't been traded). But now because of the housing crash, he would no longer be able to sell it for $500K. Is it still worth $500K because he bought and held? Or is it worth $400K because that is what the s...
by eurowizard
Mon Jan 04, 2010 11:44 am
Forum: Investing - Theory, News & General
Topic: Reminder on Stock Valuations and Pricing
Replies: 9
Views: 1533

Re: Reminder on Stock Valuations and Pricing

I don't see the difference. If projected earnings increase, demand goes up while supply stays the same, so the price goes up. It's still a simple supply-demand relationship. - DDB Good Morning, The difference is that in your example the "demand" is driven by an increase in value. This is equivalent...