Sour grapes

[Mman]

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If have to adjust for inflation. Nominal gains are meaningless. Plus, there's a problem with investing continuously...volatility impairs the long term compounding. Spitznagel Blasts 'Buy-And-Hold': "It's More Like Hope & Prayer" From Here

http://2o9ub0417chl2lg6m43em6psi2i.wpengine.netdna-cdn.com/wp-content/uploads/2017/01/graf-2.png

Can you at least admit the intentional stupidity of this graph that ignores the impact of dividends? Reinvested dividends add more than 4% PER YEAR to that return number. The inflation adjusted return for that 100 years is 6.7% when you include dividends.

You are being intentionally obtuse and misleading. Either that or you aren't smart enough to understand. Volatility is helpful for someone regularly investing over time since it allows them lots of chances to buy lower than the long term average. But even if you are just here to be a troll, it's at least valuable to reply to your inane posts so that less knowledgeable folks that come along can actually be educated correctly.

 

[Dr. Galazkiewicz]

Can you at least admit the intentional stupidity of this graph that ignores the impact of dividends? Reinvested dividends add more than 4% PER YEAR to that return number. The inflation adjusted return for that 100 years is 6.7% when you include dividends.

You are being intentionally obtuse and misleading. Either that or you aren't smart enough to understand. Volatility is helpful for someone regularly investing over time since it allows them lots of chances to buy lower than the long term average. But even if you are just here to be a troll, it's at least valuable to reply to your inane posts so that less knowledgeable folks that come along can actually be educated correctly.

Actually if you crunch the numbers volatility hurts more than it helps. For example, if you drop 50% you have to go up 100% to get even. If you drop 67%, then 200% to recover. It's not so much you get to buy cheaper, it's all the underwater positions that will drag your overall performance down.

 

[Mman]

Actually if you crunch the numbers volatility hurts more than it helps. For example, if you drop 50% you have to go up 100% to get even. If you drop 67%, then 200% to recover. It's not so much you get to buy cheaper, it's all the underwater positions that will drag your overall performance down.

the numbers have been crunched. Guess what, the "if it goes down 50% it has to go up 100% to get even" is taken into account. The stock market goes up over time. That's what happens. So that means that by definition for every 50% drop we've seen, it's gone up more than 100% afterwards. And when it's down, that's when your investments are going to do even better going forward.

just give up

You have failed basic math and logic in this thread. Stop doubling down on being incorrect.

 

[Raryn]

Actually if you crunch the numbers volatility hurts more than it helps. For example, if you drop 50% you have to go up 100% to get even. If you drop 67%, then 200% to recover. It's not so much you get to buy cheaper, it's all the underwater positions that will drag your overall performance down.

You need to learn the difference between geometric and arithmetic means. And to take into account reinvested dividends (as appropriately mentioned above).

Not to mention that with the S&P at least, as your time period goes up, volatility goes down. One week volatility? Huge. One year volatility? Big. Twenty year volatility? Modest. Fourty year volatility? Small.

 

[Dr. Galazkiewicz]

You need to learn the difference between geometric and arithmetic means. And to take into account reinvested dividends (as appropriately mentioned above).

Not to mention that with the S&P at least, as your time period goes up, volatility goes down. One week volatility? Huge. One year volatility? Big. Twenty year volatility? Modest. Fourty year volatility? Small.

interesting you stopped at 40 years. That's the problem. You've only experienced the happy side of the eurodollar bubble.

 

[Dr. Galazkiewicz]

the numbers have been crunched. Guess what, the "if it goes down 50% it has to go up 100% to get even" is taken into account. The stock market goes up over time. That's what happens. So that means that by definition for every 50% drop we've seen, it's gone up more than 100% afterwards. And when it's down, that's when your investments are going to do even better going forward.

just give up

You have failed basic math and logic in this thread. Stop doubling down on being incorrect.

Are you familiar with Hussman's work? The projected returns at certain PE values. You don't want to know what that graph is saying now.

 

[Dr. Galazkiewicz]

You can see the eurodollar bubble right on this graph. S&P has seen a dead cat bounce since the GFC, but is going to plumb the 10 gram level.

 

[Mman]

Are you familiar with Hussman's work? The projected returns at certain PE values. You don't want to know what that graph is saying now.

Hussman? You bringing out that tool? People that followed his advice and invested with him have decades of underperformance to show for it. I wouldn't hitch myself to that wagon. Go back and read his stuff from 2009-2012. It's priceless in hindsight.

just admit your trolling is wrong and move along. You should actually go read and follow the advice you claimed in the original post to have gotten from Bogleheads.

actually, screw it. Invest in his total return fund. It's returned 2.69% per year over the last decade (4.52% since 2002) for the low, low cost of 0.84% AUM. You could've bought a 20 year treasury in 2002 that yielded almost 6%. He's literally less effective than a risk free investment.

 

[Dr. Galazkiewicz]

Hussman? You bringing out that tool? People that followed his advice and invested with him have decades of underperformance to show for it. I wouldn't hitch myself to that wagon. Go back and read his stuff from 2009-2012. It's priceless in hindsight.

just admit your trolling is wrong and move along. You should actually go read and follow the advice you claimed in the original post to have gotten from Bogleheads.

actually, screw it. Invest in his total return fund. It's returned 2.69% per year over the last decade (4.52% since 2002) for the low, low cost of 0.84% AUM. You could've bought a 20 year treasury in 2002 that yielded almost 6%. He's literally less effective than a risk free investment.

Central banks stepped in and MTM was suspended. That's what has been levitating markets as well as debt-binging buybacks. The Hussmans will look stupid until they don't and then the reality of the collapse will there for all to see.

When assets are to be priced to reflect reality, you want to be ahead of that. The day after could be too late. It can happen quick. Perhaps on a Sunday night. This could unfold as a political decision as opposed to a market decision ala FDR or Nixon.

 

[atomi]

The financial idiocy on this thread is astounding coming from educated professionals. You are seriously taking advice from internet personalities on investing web forums? You know those are populated by trolls, scammers, and like minded idiots? You know how these supposedly genius fund managers make their money? It's not from their own investing. It's from profiting off idiots like you. If you want to throw your money away chasing past returns at the expense of stupid high expense ratios and suffer extreme underperformance all the while panic selling when the market drops and panic buying when the market is reaching all-time highs, go right ahead. You wouldn't be the first. You'd have a lot more fun and frankly better odds at the craps table at Harrah's. Dice setters have more rational arguments than you.

 

[Dr. Galazkiewicz]

The financial idiocy on this thread is astounding coming from educated professionals. You are seriously taking advice from internet personalities on investing web forums? You know those are populated by trolls, scammers, and like minded idiots? You know how these supposedly genius fund managers make their money? It's not from their own investing. It's from profiting off idiots like you. If you want to throw your money away chasing past returns at the expense of stupid high expense ratios and suffer extreme underperformance all the while panic selling when the market drops and panic buying when the market is reaching all-time highs, go right ahead. You wouldn't be the first. You'd have a lot more fun and frankly better odds at the craps table at Harrah's. Dice setters have more rational arguments than you.

Thank you for your input.

 

[The Physician Philosopher]

:troll:

 

[Mman]

Central banks stepped in and MTM was suspended. That's what has been levitating markets as well as debt-binging buybacks. The Hussmans will look stupid until they don't and then the reality of the collapse will there for all to see.

When assets are to be priced to reflect reality, you want to be ahead of that. The day after could be too late. It can happen quick. Perhaps on a Sunday night. This could unfold as a political decision as opposed to a market decision ala FDR or Nixon.

a fool and his money are soon parted. There is 0.0% chance that people investing with Hussman over decades will have a satisfactory return on their investments. None. You can scream stupid stuff for decades and be right once or twice and say "told you so" after the fact. That doesn't mean you were right the other 99% of the time and that 99% is where the money is made long term.

Perhaps you could all help us out and make some specific predictions we can look back at 5 years from now to judge you on.

 

[Dr. Galazkiewicz]

a fool and his money are soon parted. There is 0.0% chance that people investing with Hussman over decades will have a satisfactory return on their investments. None. You can scream stupid stuff for decades and be right once or twice and say "told you so" after the fact. That doesn't mean you were right the other 99% of the time and that 99% is where the money is made long term.

Perhaps you could all help us out and make some specific predictions we can look back at 5 years from now to judge you on.

The Hussman people will look like losers until the monster gains are made very quickly. The crowd that doesn't realize asset prices are being artificially levitated will look like geniuses until years of gains are lost in a very short amount of time. Ask yourself, are your gains still at risk? Have you left the table? You haven't made diddly until it's realized.

 

[Dr. Galazkiewicz]

https://www.richardduncaneconomics.com/money-revolution/

Duncan doesn't name it but what's referring to is the Eurodollar. The explosion of credit emitted by banks not under control of the Fed is in large part what has levitated USD assets since the "irrational exuberance" of Greenspan's days.

And guess what? This system died in 2007. The true cause of the GFC and nothing has been fixed since. The inevitable collapse merely forestalled by central bank intervention.

 

[Mman]

The Hussman people will look like losers until the monster gains are made very quickly. The crowd that doesn't realize asset prices are being artificially levitated will look like geniuses until years of gains are lost in a very short amount of time. Ask yourself, are your gains still at risk? Have you left the table? You haven't made diddly until it's realized.

Hussman has been thrown many bear markets and still come out looking like a loser. His own funds cover the 2001/2 and 2008 downturns and they still suck.

He just makes money off people stupid enough to believe his world is ending talk. Apparently he snagged you too. Not something to be proud of.

As for me, I have no "gains still at risk" that I will need to spend in the next 30 years. And I will bet you $5,000,000 that the S&P will be substantially higher 30 years from now than it is today.

 

[Stroganoff]

After I picked my jaw up off the floor, I decided to re-read the original post:

Did I just get sucked into a top during January? Having sat out the market all these years, I had recently read all the books recommended by the Bogleheads and all my friends were bragging about how much money they making. I was missing out. Now I'm down and it looks like the market is going to negative 5000. Will I owe money if it goes below zero?

There's no way in hell that this Dr. Galazkiewicz guy "read all the books recommended by the Bogleheads" and still managed to post essentially the exact opposite. No way in hell.

I'll be brutally honest: I'd like to someday get through the Bogleheads' book reading list. There's a dozen or so highly recommended books, and they're all on my Amazon wishlist but I just haven't pulled the trigger and put in the effort. I'm lazy when it comes to reading physical books. I've definitely spent a good combined 100 or so hours devouring the Bogleheads Wiki (highly recommended and free!) as well as the forums (pretty addictive if you obsess like me and open up a new tab for each interesting thread that catches your eye), and I've learned a ton from Bogleheads wisdom. Just not from the books. But even I know better than to spout the garbage the OP spouts. It sounds like a perfect advertising pitch, "I read all the Bogleheads books [establishes credibility or commonality with the audience], but what I really think is...."

Join date is February 28, 2018. And many of this guy's posts are Finance-related. Maybe an alternate/secondary account of an existing SDN user? Or maybe he's got a hidden ulterior financial interest to promote some of these people? I don't know. It's just not adding up. The accusations of troll seem accurate (in my opinion), but I still have to be that annoying 5-yo and ask why. What does the OP get out of creating an account on SDN just to post poor financial advice?

 

[atomi]

I had to re-read the posts in this thread as well. Pretty clear this guy is trolling or in the worst case actually a paid shill. He mentions some obscure name of Chris Cole that nobody has ever heard of, as if we are supposed to know who he is. Google him and you get a pro skateboarder. Keep digging through pages and pages of google and you eventually get some obscure 30-something kid fund manager and a youtube video of him sweating with dilated pupils. The really hilarious thing is that this guy goes on and on about volatility, while the OP starts this thread by saying that he just lost a lot of money by holding a triple leveraged index ETF. Yes, theoretically you can make money by holding a leveraged ETF if the market slowly and steadily trends up or down. But in a volatile market with 1000 point swings every other day, any fool can see that these will quickly become worthless. So you gotta ask yourself, what does this guy have to gain by name dropping obscure fund managers? Is he just trolling? I don't know -- that's a lot of effort just for kicks.

These niche fund guys always end up being total duds. They get one good streak, and then ride their whole career on that. I got suckered into Berkowitz's fund when I was younger. Will never make that error again. I invest in index funds as well as buying and hold blue chips with high dividends ala Dogs of the dow style, one of the only systems that has consistently beaten the S&P, and partially reinvest and then invest dividends into index funds. I do make a few occasional stock picks to spice things up a little. It's really not that hard.

 

[Dr. Galazkiewicz]

Yes, theoretically you can make money by holding a leveraged ETF if the market slowly and steadily trends up or down.

Actually all these triple levered etfs will trend to zero. Even a bull 3x ETF in a bull market. It 's the daily volatility that erodes it.

 

[Dr. Galazkiewicz]

What percentage of revenue would that be? (hint: it's tiny)

 

[Mman]

that didn't answer the question

 

[Mman]

Actually all these triple levered etfs will trend to zero. Even a bull 3x ETF in a bull market. It 's the daily volatility that erodes it.

yes, that's why you never should invest in levered ETFs. Leveraged ETFs are designed to lose money over time because of daily volatility. Has nothing to do with long term investing.

 

[Dr. Galazkiewicz]

I watched this last night. Got me thinking. 3T in flows to come out of US markets. Yikes!

And then this. We have 15T in marketable debt now.

 

[WholeLottaGame7]

LOL, I don't know what it was like reading this thread in real-time, but in retrospect it's a D+ exercise in trolling. He held the line for like 4 or 5 posts and then couldn't help himself and caved in to his true agenda. Pretty certain this guy is Crixus or Toe Cheeze from the WCI forums.

 

[Mman]

LOL, I don't know what it was like reading this thread in real-time, but in retrospect it's a D+ exercise in trolling. He held the line for like 4 or 5 posts and then couldn't help himself and caved in to his true agenda. Pretty certain this guy is Crixus or Toe Cheeze from the WCI forums.

he sure watches a lot of stupid youtube videos and reads a lot of dumb articles. It's like you have to try hard to be that incorrect. Good thing he's really into the Bogleheads philosophy though 🤣