In speaking with a prospective client yesterday, he told me he’s been in Richard C. Young’s Maximizers portfolio for years. He said he uses an advisor but told him, “Here’s what I want to own, can you do it for me?” And he did. Fast forward—after making a big contribution to the account this year, his “guy” wants to put the money in some hedge fund deal. My new client said, “Don’t do a thing.” The “guy” was chasing money–chasing money with other people’s money. What’s there to lose, right? In times like these, you need to protect your assets like they’re the last ones you’ll ever … [Read more...]
You Invest, They Win
The founder of the largest hedge fund in the universe, Ray Dalio, tweeted this from Burning Man:
Just back from Burning Man. Reminds me of Woodstock with better art (installations) and less good music. What a great vibe and what amazing creativity!
Photo is with my pal and coworker Jeff Taylor at his great music camp Root Society. If you go next year, 1-5am is best.
Are these the guys you want running your money? You invest, they win. But hey, it’s not about the money. It’s about saving the planet man.
Because if it’s about the money (Dalio has a personal net worth of $19 billion) then this hedge fund lost to a boring Vanguard fund that uses a conventional mix of 60% stocks and 40% bonds.
The article doesn’t come out and name the fund, but perhaps you, as a long-time reader of our websites, know the name: Vanguard Wellington.
You might also know what Vanguard founder, the late, great, Jack Bogle, meant when he said: “The grim irony of investing is that we investors as a group not only don’t get what we pay for, we get precisely what we don’t pay for.”
The captains of the investing universe are living their “best life” at whose expense?
Yours, of course. You invest, they win. Read more below.
The Fed is Sacrificing Retirees to Save the Banks
You may have heard three cheers from Wall St. recently when JPMorgan Chase & Co. announced its "highest-ever quarterly profit." The bank, America's largest at the moment, got an extra boost by recognizing that some loans it had previously written off were actually going to pay. Good for the bank, right? Sure, but to make it happen the Fed is holding interest rates at nearly zero and sacrificing savers and retirees to save big banks. There are no plans to change course or to have banks share in the pain being suffered by America's savers and retirees. The NY Times reported this morning … [Read more...]
How Are You Doing on a Local Level?
How are you doing on a local level? Are you taking small steps every day to secure your situation? You don’t have to change your world in a day. Here are some thoughts looking out at my backyard: The local paper ran an article this week titled Firearm Interest Up Locally. The catalyst for the increased interest seems to be the election, and much like post-9-11, respondents are saying they were looking to buy anyway, this just made them take action. Applications to the Newport Rifle Club are way up, especially by female applicants, with demand for training by both genders way up as … [Read more...]
February RAGE Gauge: Americans Focusing on What’s In Front of Them
You think Americans are feeling elevated risk? You wouldn't know it by looking at the stock market. But how are you doing on a local level? Are you taking small steps every day to secure your situation? You don’t have to change your world in a day. Focus on what's right in front of you. That's what's most important. Here are some thoughts looking out at my backyard: Are you seeing local prices higher or lower? Here, the price for food at the grocery store is up, while remaining pretty steady at restaurants. What isn't going up is the yield you're earning on the S&P 500. Yields are … [Read more...]
There’s Always a Way Forward for Americans Like YOU
How did you learn how to make money? In reviewing a package of financial documents with a prospective client last week, he included his social security estimates. It was like finding a piece of gold as far as I was concerned. Why? Because it showed me that he began working at age 16. I was able to see what he made of himself during a lifetime of work. It’s better than reading a best seller. I said to him, “It’s nice to see how much you’ve been able to save all these years, but what stands out the most is I see you started working when you were 16-years old.” He replied, “I guess that’s what … [Read more...]
Do You Remember When NASDAQ Dropped by 82%?
If you’re not a client of mine, and know someone that’s loaded with tech stocks, help them take a look at the overlap in their portfolio. Have them look at their mutual funds and ETFs, and read the prospectus. Look at the top ten holdings. Chances are they’re all loaded with the same small group of GROWTH stocks. Remember, even trees don’t grow to the sky. There’s a shelf life, there’s a limit. If you stick with a VALUE approach (you are if you’re with me) then you’re building in discipline, like a New Year’s resolution, by sticking to a plan. Combine this approach with the Prudent Man rule, … [Read more...]
The Death of the Dollar and America’s AA Credit
Here’s a way forward. Help spread the word about what’s going on in America. As the Fed continues to debase the dollar, the stage is set for its inevitable death along with America’s AA government bond rating. At what point will investors, not just American investors, seek investment shelter in more attractive waters? When investors can cross borders with a few keystrokes, what’s keeping them from investing outside of America? The Biden/Harris cabal is loaded with ex-tech titans and a former Fed head. One who is stuffed to the gills from speaking fees paid by banks. The same banks that … [Read more...]
Don’t Be on Their Radar, Get Out of Debt Now
If they’re going to penalize you for saving, you had better learn how to play their game. Because indebted Americans are their bread and butter. Charging outrageous interest rates on credit card debt and paying zero on savings is one of the ways they stick it to you. And imagine all the information they have on you. It’s scary to say the least. That’s why I want you to stop playing their game. If you’re in debt, I want you to devise a plan to get out of it. Whether it’s a six-month, one-year, five-year, or ten-year plan, I want you out of debt. Because when the world can change literally … [Read more...]
Why Buying Bonds Matters in Times Like These
In times like these, you need to be in touch with your money. Literally, overnight, we’re on the cusp of losing the Senate and much, much more. Making sure your financial plan is airtight is front and center like never before. I want you to get out a piece of paper (do it now) and draw a line down the middle. Write down what you own on the left side, and what you owe on the right. Your goal is to make sure that what you owe is not only less than what you own but that it gets down to ZERO. You’re not being helped by the Fed holding rates at zero. When you lose money simply by saving … [Read more...]
When Dollars are Plentiful YOU Proceed with CAUTION
When dollars are created out of the air, they’re wasted. When dollars are too easy, there’s too much of them. And they’re misallocated. What could possibly go wrong? The virtue of making money year after year after year, and saving a little bit as you go, is that you don’t need to make monumental decisions about what to do with it. You create a plan. You save on a consistent basis and over time you look back and are pretty amazed at what you’ve amassed. (You can teach a grandchild how to do this here). The more government injects itself into the money equation, the more the natural law … [Read more...]