Search found 16006 matches

by HomerJ
Wed Apr 14, 2021 9:47 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

Thesaints wrote: Wed Apr 14, 2021 8:11 pm However, because of the size of public debt, the consequent interest outlays, and the stiffness of expenditures, we can be reasonably certain that large upward movements are as unlikely as large downward ones in all the advanced economies.
Good thing we don't need large upward movements.
by HomerJ
Wed Apr 14, 2021 7:57 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

Total returns from bonds are as likely to be lower than that starting yield as to be higher. There you go assuming a normal distribution again. Even at the extremes. There are other variables involved when you get into negative return territories. Variables that you ignore, and could possibly break...
by HomerJ
Wed Apr 14, 2021 2:20 pm
Forum: Personal Consumer Issues
Topic: Non-fungible tokens (NFTs): anyone investing in those?
Replies: 246
Views: 17311

Re: Non-fungible tokens (NFTs): anyone investing in those?

Won’t the frictionless proliferation of NFTs have a tendency to erode value. Historically, collectibles have been valuable because of rarity/controlled manufacture. I would think rapid proliferation would quickly eat up available dollars. Maybe that’s not a concern yet, but would seem to be a conce...
by HomerJ
Wed Apr 14, 2021 12:12 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks continue to soar!
Replies: 14463
Views: 1112494

Re: U.S. stocks continue to soar!

Robot Monster wrote: Wed Apr 14, 2021 11:37 amYep. BlackRock sees "U.S. small caps geared to an expected cyclical upswing in 2021."
Has Blackrock ever made a prediction that turned out to be wrong?

Or did you even check that?
by HomerJ
Tue Apr 13, 2021 2:48 pm
Forum: Investing - Theory, News & General
Topic: “New Bitcoin Investors Explain Why They’re Buying at Record Prices“
Replies: 944
Views: 61295

Re: “New Bitcoin Investors Explain Why They’re Buying at Record Prices“

Just read an interesting story and thought would share (no actionability, just an amusing read) Mike Caldwell — a Salt Lake City, Utah-based timekeeping software entrepreneur — bought $20,000 worth of bitcoin at an estimated 20 cents a pop [in 2011]. Four months later, he sold it for $3 million — a...
by HomerJ
Tue Apr 13, 2021 2:41 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks continue to soar!
Replies: 14463
Views: 1112494

Re: U.S. stocks continue to soar!

https://www.economist.com/graphic-detail/2021/03/15/young-people-stand-to-make-dismal-returns-on-their-investments What do you make of this guys? if not stocks... then what else? https://i.imgur.com/dk4gN6x.png That chart is rubbish... (1) It's comparing 70 years of investing with 50 years of inves...
by HomerJ
Tue Apr 13, 2021 2:16 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

4% "rule of thumb" is close to what you are saying... 25 years of expenses that should last 30 years. Because we expect SOME growth over 30 years. Your idea is 30 years of expenses to last 30 years (or 40 years of expenses to last 40 years). That's pretty conservative, assuming zero real g...
by HomerJ
Tue Apr 13, 2021 1:08 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks continue to soar!
Replies: 14463
Views: 1112494

Re: U.S. stocks continue to soar!

Possible price change is, of course, material to the financial decision. Price change is unknowable. I have ESPP stock with status changes extending 2 years into the future, on a rolling basis. If I were to sell them all now in an effort to preserve current price: 1. I'd pay short term cap gains on...
by HomerJ
Tue Apr 13, 2021 12:19 pm
Forum: Investing - Theory, News & General
Topic: “New Bitcoin Investors Explain Why They’re Buying at Record Prices“
Replies: 944
Views: 61295

Re: “New Bitcoin Investors Explain Why They’re Buying at Record Prices“

The entire Internet and all modern security can change with the times, and update their protocols. Bitcoin is locked into using the old security hashes. A new coin would have an advantage. Bitcoin isn't "locked into" anything. It can be updated just like any other software protocol. The B...
by HomerJ
Tue Apr 13, 2021 12:13 pm
Forum: Investing - Theory, News & General
Topic: “New Bitcoin Investors Explain Why They’re Buying at Record Prices“
Replies: 944
Views: 61295

Re: “New Bitcoin Investors Explain Why They’re Buying at Record Prices“

For me, it would require surpassing gold's market cap to become gold 2.0. :wink: I wouldn't hold gold at today's prices after all. Have you ever held physical pirate loot in your hands? Not paper or 0101010101. I've always been more into robots than pirates myself :happy Sometimes I wish this forum...
by HomerJ
Tue Apr 13, 2021 12:07 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks continue to soar!
Replies: 14463
Views: 1112494

Re: U.S. stocks continue to soar!

Mega corp stock going up too much, increasing past its target AA. But have to wait until July to sell next tranche of ESPP for best tax treatment.... Don't let the tax tail wag the dog. Why not? If the price stays the same, change of disposition qualification is a guaranteed profit vs selling now. ...
by HomerJ
Tue Apr 13, 2021 11:34 am
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

5% has failed in the past, so 5% is risky. 4% has never failed in the past (okay 3.8% once), so that seems like solid number to plan around, eh? It's like building a house above the flood line. There's no guarantee that's safe. Maybe some variable will change, and the next flood will reach your hou...
by HomerJ
Tue Apr 13, 2021 10:35 am
Forum: Investing - Theory, News & General
Topic: “New Bitcoin Investors Explain Why They’re Buying at Record Prices“
Replies: 944
Views: 61295

Re: “New Bitcoin Investors Explain Why They’re Buying at Record Prices“

Sounds like performance chasing... Past performance does not indicate future returns. I hold around 1-2% BTC. Could never see holding more than 5%, too much risk. Uncle Sam just needs to use their quantum computers and there goes 15% of your net worth. Sure, but are you rebalancing down? Even if I ...
by HomerJ
Tue Apr 13, 2021 10:30 am
Forum: Investing - Theory, News & General
Topic: U.S. stocks continue to soar!
Replies: 14463
Views: 1112494

Re: U.S. stocks continue to soar!

watchnerd wrote: Tue Apr 13, 2021 9:13 am Mega corp stock going up too much, increasing past its target AA.

But have to wait until July to sell next tranche of ESPP for best tax treatment....
Don't let the tax tail wag the dog.
by HomerJ
Tue Apr 13, 2021 10:24 am
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

Vineviz... that long explanatory post was probably the best post you've ever made on this boards. Very clear, barely dismissive at all. Thank you. This is why we typically rely on the simplest model that will do the job effectively, and favor models with intuitive and rational interpretations. Ultim...
by HomerJ
Mon Apr 12, 2021 10:21 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

if you know anyone who, with a straight face, can defend an e xpected real return for stocks of 10% going forward from here I'd love to meet them. This sounds pretty similar to Cliff Asness back in 2012. https://www.aqr.com/Insights/Research/White-Papers/An-Old-Friend-The-Stock-Markets-Shiller-PE B...
by HomerJ
Mon Apr 12, 2021 10:00 pm
Forum: Investing - Theory, News & General
Topic: CAPE: A much stronger predictor of stock returns than many think
Replies: 578
Views: 39230

Re: CAPE: A much stronger predictor of stock returns than many think

This ratio was at a record 28 in January 1997, with the only other instance (at that time) of a comparably high ratio occurring in 1929. Shiller and Campbell asserted the ratio was predicting that the real value of the market would be 40% lower in ten years than it was at that time. That forecast p...
by HomerJ
Mon Apr 12, 2021 8:01 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

There are too many variables to make accurate predictions... Economics is far harder than rocket science. You are unable to model accurately the odds in the past. You are unable to model accurately the odds today. You are therefore unable to accurately know if the odds are better or worse today. So...
by HomerJ
Mon Apr 12, 2021 7:19 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

It seems like the weakness in such an argument is that people can and do come up with different forward expectations - the future is just that cloudy. SWR having a technical definition (10% fail rate) doesn't make the value actionable unless those forward estimates are reliable. Tells us how you ca...
by HomerJ
Mon Apr 12, 2021 7:06 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

We have 150 years of data, that’s a very very good trend. You seem to think that we are in some sort of novel time period. Maybe we are. I'm wondering if there ought to be 3 different projections for SWR: 1. Assuming that most of the withdrawal period doesn't include massive Fed intervention like t...
by HomerJ
Mon Apr 12, 2021 4:10 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

With a P/E above 40 that's not the most likely result going forward. You seem to forget that we are talking about 30 years. We may indeed have poor returns for the next 10 years or even longer. But bad years are followed by good years. If you believe in valuations and "expected" returns, ...
by HomerJ
Mon Apr 12, 2021 3:45 pm
Forum: Investing - Theory, News & General
Topic: “Buy and Hold No More” says A16Z
Replies: 90
Views: 9030

Re: “Buy and Hold No More” says A16Z

Man it’s easy to feel like a genius when all you know is an 11 year rising market. I’m a tad worried for all the people “investing” these days, who have absolutely no idea what they’re doing. Articles like this, and WSB on Reddit are drawing them in and really encouraging them. Be real, they are ga...
by HomerJ
Mon Apr 12, 2021 3:33 pm
Forum: Personal Consumer Issues
Topic: Who is your favorite fiction author and what is your favorite book of theirs?
Replies: 254
Views: 18624

Re: Who is your favorite fiction author and what is your favorite book of theirs?

Carousel wrote: Fri Dec 04, 2020 4:43 pm Watership Down, Richard Adams.
What are we willing to risk for freedom, what will we endure for safety? How do we treat our visionaries?
I need to reread that book... It's been 20-30 years... but I read it like 5-6 times back when I was younger.
by HomerJ
Mon Apr 12, 2021 3:27 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

Sometimes the reason I think. If you're working hard and scrimping to put together a portfolio that will work at 4% SWR and somebody tells you it's not enough, it's a bummer. People will rationalize why the bearer of unwelcome news must be wrong, Human Nature 101 (the bearer of bad news isn't neces...
by HomerJ
Mon Apr 12, 2021 3:25 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

Can you tell us why it has worked and why it would be lucky to work in the future? You are the one making the claim. Are you saying you have a grasp of economic variables to an extent that it allows you to understand the probabilities of future outcomes enough to make claims about the potential suc...
by HomerJ
Mon Apr 12, 2021 3:11 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

Sometimes the reason I think. If you're working hard and scrimping to put together a portfolio that will work at 4% SWR and somebody tells you it's not enough, it's a bummer. People will rationalize why the bearer of unwelcome news must be wrong, Human Nature 101 (the bearer of bad news isn't neces...
by HomerJ
Mon Apr 12, 2021 2:47 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

Can you tell us why it has worked and why it would be lucky to work in the future? You are the one making the claim. Are you saying you have a grasp of economic variables to an extent that it allows you to understand the probabilities of future outcomes enough to make claims about the potential suc...
by HomerJ
Mon Apr 12, 2021 2:26 pm
Forum: Investing - Theory, News & General
Topic: “Buy and Hold No More” says A16Z
Replies: 90
Views: 9030

Re: “Buy and Hold No More” says A16Z

I think retail traders actually did outperform the market in the last 12 months. There is this BUZZ index which tracks the 75 most popular stocks on social media and this index massively outperformed the market in the last 12 months. It is interesting to check the constituents of this index. Well s...
by HomerJ
Mon Apr 12, 2021 2:24 pm
Forum: Investing - Theory, News & General
Topic: “Buy and Hold No More” says A16Z
Replies: 90
Views: 9030

Re: “Buy and Hold No More” says A16Z

Man it’s easy to feel like a genius when all you know is an 11 year rising market. I’m a tad worried for all the people “investing” these days, who have absolutely no idea what they’re doing. Articles like this, and WSB on Reddit are drawing them in and really encouraging them. Be real, they are ga...
by HomerJ
Mon Apr 12, 2021 12:56 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

Thesaints wrote: Mon Apr 12, 2021 12:44 pmIt is abundantly clear that nor the Fed, nor the BCE, will "ever" raise rates.
Nothing is ever abundantly clear in economics. That's your giant mistake.
by HomerJ
Mon Apr 12, 2021 12:26 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks continue to soar!
Replies: 14463
Views: 1112494

Re: U.S. stocks continue to soar!

Not a prediction, a medium-term forecast; A return to the 2020 low - how can this be unthinkable? - would be a drawdown of 46%. Retail investors are the most committed since 2000. The maximum number of people will be sucked in, then problems will be uncovered in the Fall accompanied with an almight...
by HomerJ
Mon Apr 12, 2021 12:22 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

What? Why? For how many years? Where did you come with up with this idea? https://fred.stlouisfed.org/series/GFDEBTN https://www.usgovernmentspending.com/us_fed_spending_pie_chart Debt to GDP has been this high before... You are making a huge assumption that interest rates cannot possibly go up eve...
by HomerJ
Mon Apr 12, 2021 12:09 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

Thesaints wrote: Mon Apr 12, 2021 12:01 pmBond returns are the lowest they have ever been and they have to stay that way.
What? Why? For how many years? Where did you come with up with this idea?
by HomerJ
Mon Apr 12, 2021 11:50 am
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

Which is certainly possible. But the real question is what you assume for future variance of stock return. It's clear expected return of stocks now is lower than past long term average return. Stock valuations are much higher now, as they basically *should* be because expected return on the safer a...
by HomerJ
Mon Apr 12, 2021 10:54 am
Forum: Personal Investments
Topic: Buying a 1.5M house in Austin. Should I pull it?
Replies: 51
Views: 5314

Re: Buying a 1.5M house in Austin. Should I pull it?

newyorker wrote: Mon Apr 12, 2021 9:28 am I guess buying 1.5M on whim or on fear of missing out is not smart...
What are you missing out on?

Getting rich? You're already rich.
by HomerJ
Sun Apr 11, 2021 11:32 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

A 4% WR has worked for 30 year retirements 99% of the time with a 75/25 portfolio. That’s 150 years of data. A 4% WR worked most of the time in the past. It might work in the future, but it is LESS likely to work in the future than it was in the past. You don’t know that. You have no idea what the ...
by HomerJ
Sun Apr 11, 2021 4:06 pm
Forum: Investing - Theory, News & General
Topic: CAPE: A much stronger predictor of stock returns than many think
Replies: 578
Views: 39230

Re: CAPE: A much stronger predictor of stock returns than many think

The fact that we don't know, or can't time, when these "regime shifts" occur, is more evidence that it's probably a good idea to invest in them at all times and never be 100% in or out of any particular geographical area or risk factor. Moving money based upon valuations is what you would...
by HomerJ
Sun Apr 11, 2021 3:55 pm
Forum: Investing - Theory, News & General
Topic: CAPE: A much stronger predictor of stock returns than many think
Replies: 578
Views: 39230

Re: CAPE: A much stronger predictor of stock returns than many think

US and Intl tracked CAPE well from 1990 until 2009 , then deviated substantially (mostly due to valuations), may be a good time to overweight international now as this is one of the largest deltas on record This is incorrect, at least with regards to the U.S. CAPE was devised in 1988, and since the...
by HomerJ
Sun Apr 11, 2021 2:37 pm
Forum: Personal Finance (Not Investing)
Topic: The primary factor for picking a College/University is out of pocket cost
Replies: 164
Views: 7775

Re: The primary factor for picking a College/University is out of pocket cost

No amount of money can repeat 4 years being surrounded by highly motivated peers. Smart highly motivated kids end up together in the harder classes, no matter where you go to school. If your kid is smart enough to get into the top schools, they will be in the top 5% at Flagship State. And they will...
by HomerJ
Sun Apr 11, 2021 2:34 pm
Forum: Personal Finance (Not Investing)
Topic: The primary factor for picking a College/University is out of pocket cost
Replies: 164
Views: 7775

Re: The primary factor for picking a College/University is out of pocket cost

But the cost analysis is really between getting into your local flagship versus a slightly higher ranked public out of state university or your average private university. Neither the improved education or social networking is likely to produce a $500K-1M ROI delta to offset just saving the money i...
by HomerJ
Sun Apr 11, 2021 1:58 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

This is just amusing to me at this point. Didn't Bill Bengen just say the new SWR is around 5% a few months ago? Man oh man, this stuff changes on a whim! It's all just noise. Don't worry about it, no one knows what's gonna happen. Actually, Bengen and Pfau are looking at the same data and coming t...
by HomerJ
Sun Apr 11, 2021 1:39 pm
Forum: Investing - Theory, News & General
Topic: CAPE: A much stronger predictor of stock returns than many think
Replies: 578
Views: 39230

Re: CAPE: A much stronger predictor of stock returns than many think

US and Intl tracked CAPE well from 1990 until 2009 , then deviated substantially (mostly due to valuations), may be a good time to overweight international now as this is one of the largest deltas on record This is incorrect, at least with regards to the U.S. CAPE was devised in 1988, and since the...
by HomerJ
Sun Apr 11, 2021 1:34 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

This is just amusing to me at this point. Didn't Bill Bengen just say the new SWR is around 5% a few months ago? Man oh man, this stuff changes on a whim! It's all just noise. Don't worry about it, no one knows what's gonna happen. Actually, Bengen and Pfau are looking at the same data and coming t...
by HomerJ
Sun Apr 11, 2021 1:33 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13697

Re: Another 2.8% SWR Article Quoting Wade Pfau

I hesitate to start yet another "4% won't work" SWR thread, but I saw this WSJ article and think anything quoting Wade Pfau will be of interest to Bogleheads: https://www.wsj.com/articles/retirement-nest-egg-11617929631 "Wade Pfau, a professor at the American College of Financial Ser...
by HomerJ
Sun Apr 11, 2021 11:50 am
Forum: Investing - Theory, News & General
Topic: CAPE: A much stronger predictor of stock returns than many think
Replies: 578
Views: 39230

Re: CAPE: A much stronger predictor of stock returns than many think

Cliff Asness is kind enough to provide us an easily tested real world application. In November of 2012, he used CAPE to predict the return of the S&P 500 over the following decade. The prediction still has a year an half or so to reach a full decade but we can examine how it is going so far. Th...
by HomerJ
Sat Apr 10, 2021 3:56 pm
Forum: Personal Finance (Not Investing)
Topic: Anyone contemplating OLY (One Less Year)?
Replies: 52
Views: 4748

Re: Anyone contemplating OLY (One Less Year)?

I think it comes down to your original plan. If you decided to retire when you hit x, and you hit x, what gives? Future returns might be better or worse than previous, nobody knows. I think this puts you in the ‘one more year’ camp. It’s obviously an emotional decision, I’m sure I’d be considering ...
by HomerJ
Sat Apr 10, 2021 2:33 pm
Forum: Personal Finance (Not Investing)
Topic: Anyone contemplating OLY (One Less Year)?
Replies: 52
Views: 4748

Re: Anyone contemplating OLY (One Less Year)?

If you hit your # early, and are ready to go, why not? Scale back your AA if it’s necessary. Even with the recent run up, I’m not close I've read (JL Collins I believe) point out that retiring when you reach a number makes you more susceptible to sequence of returns risk, as you are more likely to ...
by HomerJ
Sat Apr 10, 2021 12:04 pm
Forum: Personal Finance (Not Investing)
Topic: Anyone contemplating OLY (One Less Year)?
Replies: 52
Views: 4748

Re: Anyone contemplating OLY (One Less Year)?

If you hit your # early, and are ready to go, why not? Scale back your AA if it’s necessary. Even with the recent run up, I’m not close I've read (JL Collins I believe) point out that retiring when you reach a number makes you more susceptible to sequence of returns risk, as you are more likely to ...
by HomerJ
Sat Apr 10, 2021 10:57 am
Forum: Investing - Theory, News & General
Topic: CAPE: A much stronger predictor of stock returns than many think
Replies: 578
Views: 39230

Re: CAPE: A much stronger predictor of stock returns than many think

US CAPE is now over 37, highest since the year 2000 https://www.multpl.com/shiller-pe/table/by-month The real 10yr yield today is -0.64%, back then it was 1.77%. In 1996, Forester, you have would written. US CAPE is now over 25, highest since 1929!! The real 10yr yield today is 1.8%, back then it w...