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WBraun
climber
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Dec 19, 2017 - 07:47am PT
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All the stock market crashes were created on purpose by the criminals that Fritz feeds ......
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Fritz
Social climber
Choss Creek, ID
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Topic Author's Reply - Dec 19, 2017 - 08:27am PT
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WBraun! Re your remark: All the stock market crashes were created on purpose by the criminals that Fritz feeds ......
Yeah, whatever. Luckily, us smoking fuking ducks have no control over the market. I didn't worry I was feeding criminals, but if you define corporations as criminals, I am complicit in feeding them, so they can feed me.
Edit!
And then I can help feed Government employees like you, by paying taxes on my criminal earnings.
Wait! Doesn't that make you complicit too?
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Reilly
Mountain climber
The Other Monrovia- CA
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Dec 19, 2017 - 10:05am PT
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it's obvious that free markets don't work
There’s no free anything, except maybe street drug markets. All other markets are regulated to some degree. You like cauliflower? It came to yer store via a ‘market’, with LOTS of regs. Hell, even the air we breathe is courtesy of a market of sorts. Ask any Beijing resident.
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Lituya
Mountain climber
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Dec 19, 2017 - 11:13am PT
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Lituya, have been down to Mexico lately? I guess all of the 9.6% of the world that lives in dire poverty must all be in Baja
I go there regularly 2x year for work or fun. Mostly MC, Puebla, or Veracruz area. Beautiful. Never been to Baja. Even Climbed Orizaba again last February at age 55. Mexico’s problems have little to do with capitalism and everything to do with a culture that tolerates corruption.
Since you asked, have you been you Venezuela lately? Might be good for you to see your ideas in action.
.Should we return to those old days of libertarian free market pollution control?
Uhhhhhhh, no. Did anyone suggest we should?
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Gary
Social climber
Desolation Basin, Calif.
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Dec 19, 2017 - 11:42am PT
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Reilly, that's true. Fortunately.
ituya wrote:Since you asked, have you been you Venezuela lately? Might be good for you to see your ideas in action.
I'd prefer to go to one Forbe's Magazine's best cities in the world to live in list to see my ideas in action.
Why don't you go to Indonesia to see your ideas in action?
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Larry Nelson
Social climber
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Dec 19, 2017 - 12:42pm PT
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Fritz,
For those youngsters:
"The most powerful force in the universe is compound interest."
Albert Einstein
Edit
Gary,
You mean go to Singapore to see Reilly's world
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Fritz
Social climber
Choss Creek, ID
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Topic Author's Reply - Dec 31, 2017 - 10:41am PT
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Yesterday, I figured out what our stocks & mutual funds achieved in 2017 & I'm feeling fairly happy. Since about 40% of our portfolio is in Vanguard's safer bond funds, our return is well below that of the S & P 500 index, which was up about 20.65%.
We managed a 12.39% gain this year on our stock & bond portfolio, & our average annual gains over the last 22 years are: 9.47%
Here's where most of the money is planted, in Vanguard low fee mutual funds.
And what happens in 2018? I predict a 15% - 20% correction in the market at some point next year. I'm firm in predicting the U.S. stock market will either be up or down from its present point, by the end of 2018.
With lower tax rates, I will be more aggressive at lowering our percentage of stocks to around 50% of our portfolio, but plan on staying invested, come what may.
Vanguard is not sounding real excited about the future:
■ The most pronounced risk to the status quo resides in the United States, where an already tight labor market will grow tighter, driving the unemployment rate well below 4%. This, followed by a cyclical uptick in wages and inflation, should justify the Federal Reserve’s raising rates to at least 2% by the end of 2018. Expectations of additional rate hikes would inevitably follow, ending an era of extraordinary monetary support in
the United States and possibly leading markets to price in more aggressive normalization plans elsewhere. None of this is status quo.
■ For 2018 and beyond, our investment outlook is one of higher risks and lower returns. Elevated valuations, low volatility, and secularly low bond yields are unlikely to be allies for robust financial market returns over the next five years. Downside risks are more elevated in the equity market than in the bond market, even with higher-than-expected inflation.
■ In our view, the solution to this challenge is not shiny new objects or aggressive tactical shifts. Rather, our market outlook underscores the need for investors to remain disciplined and globally diversified, armed with realistic return expectations and low-cost strategies.
Best wishes for a happy financial New Year folks!
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Bruce Morris
Trad climber
Soulsbyville, California
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Dec 31, 2017 - 11:53am PT
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I like that bit of wisdom, Moose, "buy at the dip". That's what I'm holding out and waiting for. Waiting to ponce! Last time, I bought a repossessed race car in a warehouse in Florida for $9Gs. Who knows what goodies and toys are going to be littering the landscape when the next big dip comes down? Maybe a condo in Palo Alto? Hope so!
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unlocked gait
Gym climber
the range
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Dec 31, 2017 - 12:15pm PT
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my emotional detachment from money
has proven itself the greatest
stride in my maturity as a human.
i don't deny it. i don't run from it.
but i also, don't fear it.
and i'm wealthy beyond measure.
so much so that my personal
monetary wealth flows
laterally to those whom
suffer real shortage.
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Bruce Morris
Trad climber
Soulsbyville, California
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Dec 31, 2017 - 01:55pm PT
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It's funny though how all these climbers were so anti-ego and anti-materialistic in the 60s and 70s and now they're all bots goose-stepping to the seductive tune of security linked to the rise and fall of the stock market. I think it's because you can no longer count on getting an easy, predictable job with all kinds of benes and a retirement package like a white WWII daddy with the GI Bill and FHA home loans. No more super low tuition and 0% interest student loans either. Therefore, you have to be real cautious and hold on like smug little SOB.
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Reilly
Mountain climber
The Other Monrovia- CA
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Dec 31, 2017 - 02:21pm PT
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Bruce, how do we know when the ‘dip’ is dippest?
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Fritz
Social climber
Choss Creek, ID
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Topic Author's Reply - Dec 31, 2017 - 02:41pm PT
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Wait for the dip!
Damn!
Missed it again!
I last caught a dip, when we bought some Caterpillar stock in Feb. 2009.
Damn! That felt "GUD!"
And while "market-timers" were waiting for just the right dip, those of us staying fully invested, were sleeping fairly easily at night.
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Jim Clipper
climber
from: forests to tree farms
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Dec 31, 2017 - 11:00pm PT
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Unlocked gait, do you work in south lake tahoe?
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Bruce Morris
Trad climber
Soulsbyville, California
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Dec 31, 2017 - 11:06pm PT
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Bruce, how do we know when the ‘dip’ is dippest?
There's always a first dip and just when everybody thinks the worst is over, it takes a real nose dive and wipes 'em out for good. Sort of like the "two trauma process" in the development of irreversible, catastrophic schizophrenia. That's the golden moment to pounce, pick up some nice abandoned toys and move into the market again.
Nobody gets it right unless blind lady luck is on their side.
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Mungeclimber
Trad climber
Nothing creative to say
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Mc'Weege is back!
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Lorenzo
Trad climber
Portland Oregon
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http://www.businessinsider.com/warren-buffett-wins-million-dollar-bet-against-hedge-funds-2018-1
"In 2007, Warren Buffett entered a million-dollar bet with the fund manager Protégé Partners that the S&P 500 would beat a basket of hedge funds over the next decade.
His S&P 500 index fund compounded a 7.1% annual gain over 10 years, beating an average increase of 2.2% by the basket of funds selected by Protégé Partners.
Buffett's prize money will go to Girls Inc. of Omaha, Nebraska.
Buffett has taken issue with hedge funds' high fees and their promise of outperforming the market."
Screw the S&P. What I want is a piece of Buffet’s Berkshire Hathaway, which has outperformed the S&P by a factor of about 1,000.
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blahblah
Gym climber
Boulder
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Screw the S&P. What I want is a piece of Buffet’s Berkshire Hathaway, which has outperformed the S&P by a factor of about 1,000.
What you wanted was Berkshire Hathaway in the distant past. Returns have been very comparable to S&P for many years now. Obviously they were much higher a long time ago, but do you think that past performance will repeat? Look at Buffet's recent bets--not very impressive.
Buffet seems to enjoy his celebrity and being an "oracle,"--I suppose I'd listen to his advice to invest in index funds and not try to pick a hot stock picker (which Buffet hasn't been for a long time).
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NutAgain!
Trad climber
South Pasadena, CA
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"Buying on the dip" works if you can predict the future.
Otherwise, a strategy that effectively achieves that end result is called Dollar Cost Averaging.
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Lorenzo
Trad climber
Portland Oregon
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What you wanted was Berkshire Hathaway in the distant past.
The recent past would do.
The five previous years returned 11.5%
The ten most recent years returned 9.8%
Both substantially better than either side of the bet mentioned.
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blahblah
Gym climber
Boulder
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The recent past would do.
The five previous years returned 11.5%
The ten most recent years returned 9.8%
Both substantially better than either side of the bet mentioned.
I'm sorry but you seem somewhat ill-informed on this topic.
S&P 500 return for 5 years is 15.8%, 10 years 8.5%. See https://personal.vanguard.com/us/funds/snapshot?FundId=0540&FundIntExt=INT&ps_disable_redirect=true
So, assuming your numbers are right, the 10 year Berkshire returns are somewhat better, and the 5 year returns are significantly worth.
The somewhat better 10 year returns are certainly not a game changer--and are right where an actively managed fund that's slightly beat the 500 would be.
For example, I was lucky enough to guess that Vanguard's Primecap fund would do well and invested in years ago (more than 10 years). It's 10 year return is 11.1%, nearly identical to your vaunted Berkshire.
It should be clear from looking at the graph you posted that Berkshire absolutely killed it for a long time, but that time has long passed, and it's recent returns have been comparable to market. Maybe somewhat better, but apparently significantly worse over the medium term (5 years).
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