reriodan wrote:willthrill81 wrote:According to Credit Suisse, from 1900-2016, 117 years, the U.S. market had an annual real return of 6.4%, while the rest of the world's equities had a real return of 4.3%. Still think I'm cherry picking?
Yes, as a matter of fact. Granted, you doubled your original number of data points. I could show you plenty of time frames where US underperformed other markets. With your investing rationale, you would have been devastated had you been born japanese.
That's simply false. "Cherry picking, suppressing evidence, or the fallacy of incomplete evidence is the act of pointing to individual cases or data that seem to confirm a particular position, while ignoring a significant portion of related cases or data that may contradict that position." I'm looking at all of the data that we have access to. If you have longer data than back to 1900, please share.
Someone will probably jump in and say that I'm ignoring the countries that outperformed the U.S. from 1900-2016 (i.e. Australia and South Africa). But in comparison to total market cap, they are tiny slivers of the market, whereas the U.S. is 53% of the global market. Just as we saw in 2008-2009, if the U.S. market suffers, so does the rest of the world's equities.
reriodan wrote:willthrill81 wrote:And actually, many mutual fund managers think that they have now found a way to "beat the market" based on "solid arguments" (i.e. investing in companies with social media 'buzz' or those with high customer satisfaction ratings). These are not based in historical returns at all.
I've heard the "arguments over historical data" bit too often. That sword has two edges.
Once again, Bogle and Buffet aren't impressed with international either.
Bogle and Buffet come from a different era, and I think a lot of their motivation for US only is due to their deep-seated patriotism. I think they are wrong on this one. In fact, you can use Bogle's own logic to see the contradiction. They are speculating, though speculating at this scale probably won't be too devastating.
BTW, by "wrong" I don't mean I expect US+international to outperform US-only. I don't expect anything except market returns. That is what I am in the business of. I let the other people with crystal balls do the speculating.
When two investment legends both come to the same conclusion, albeit for slightly different reasons to my knowledge, with their own sound arguments plus strong and lengthy historical data on their side, I don't believe we should take that lightly. They both know full well about Japan, the rise of America as the world's only superpower during the 20th century, diversification, etc. They have both taught us so much about what we now treat as 'gospel', but so many completely disregard their advice on this topic. Maybe they are wrong, but so far, bets that they were wrong before haven't generally gone well I think.