Thanks for your comments - most interesting. Tyler - I see you consider the PP as a simplified risk parity approach. After much reading of Bridgewater papers, I am not sure if HB meant the permanent portfolio to be a risk parity approach, rather he might have just came up with a similar allocation u...

Am I correct in saying Risk Parity and the PP are completely different approaches? PP - focuses on assets the do well in different economic climates Risk Parity - attempts to have equal volatility in each asset class that do well in different economic climates. For instance, on this actuarial site: ...

When the seas are calm, nobody is looking for a safe harbour.....

Be careful what you wish for, you might actually get it

Hal, I don't think Ray Dalio was talking about countries working together in a group debt forgiveness cooperation agreement (GRO-DE-FO-CON-AG) when he talked about beautiful deleveraging. He was talking about households and individual governments. Households here in the US have actually reduced the...

My first thought is that if the US essentially starts defaulting on its debt, the greenback would lose its place as the world's number one currency. In that case, if Harry Browne's thinking was correct, the price of gold should skyrocket. The world economies are quite tightly coupled, and everyone ...

You may wish to do a search on Clive and bond ladder.
I remember he covered this in detail a few years back.

However, you may wish to check how your particular country's insurance scheme is funded.....

Have a look at Table 1 on page 52 of the link. https://www.rba.gov.au/publications/bul ... 1211-5.pdf

For example, no funds have been put aside in Australia to fund the scheme.

[align=][/align]Another cautionary tale on why to hold treasuries and not to chase returns....

https://en.wikipedia.org/wiki/Pyramid_Building_Society

Many friends were financially ruined because of this.

PS. Check out the interest rates on the flyer. Sounds too good not to invest!

This may be worth a read. Final of a 5 part series.

http://idiosyncraticwhisk.blogspot.com. ... eling.html

Thanks for the analysis jhogue, Could you expand a bit on why you believe Hedged International Bonds are less desirable than Australian Gov't Bonds. Same reason as Tyler? I would imagine PP'rs in Canada would face the same issue. Also, If it is best to hold just Australian Bonds, what are your thoug...

Thanks Mark and Tyler, Yes, I live in Australia, so the AUD is certainly not a major world currency ! I am leaning towards not using Hedged International Bonds, rather diversifying internationally via the Equity portion. A very good point about the "Hedge" itself being a speculative produc...

Good to hear from you Mark, Vanguard has many good research papers on hedging Eg. https://personal.vanguard.com/pdf/ISGHC.pdf Yes, you are correct - there is a cost to hedging in increased fees, however... In a flight to safety scenario, a small country's bond market AND stock market would be sold d...

If you can find Clives posts from a few years back, he went into this in some detail. Maybe you can use the wayback machine https://archive.org/web/ if they have dropped of this site. From memory..... He suggested using a five year bond ladder to replace the cash/LT section of the PP. What I can rem...

Hoping some of the wiser folk could explain if hedged bonds make any sense in a non US permanent portfolio. So... Using Australia as an example. The prospective PP investor goes to the Vanguard website and finds the following two choices for bonds https://www.vanguardinvestments.com.au/retail/ret/in...

My all time favourite....

The Obsolete Man - Old Twilight Zone Episode
https://vimeo.com/15365268

europeanwizard wrote:Do you guys actively trade on gold? Maybe as part of your variable portfolio?

Yes, in my VP.

Try this site for some ideas.
https://www.youtube.com/user/belangp/videos

Suggestions from others welcome!

<snip> There is another simple option: Cash in the PP is for liquidity, only secondarily for interest. If I was in your shoes, I would not accept a negative yield on my cash or less than 1% to tie up my money for a year. I would take 25% of my portfolio in 100 euro notes and put them into a safe dep...

A bit of the history here....

https://www.globalfinancialdata.com/gfdblog/?p=2750

For the average person 1. Without the benefit of hindsight Probably just a 50/50 stock bond portfolio as per Benjamin Grahams principles. No ETF's then so you would actually get to use the valuation methods in his book. I think almost all countries were on a pure gold standard then with the exceptio...

Hmmm. I think I would go with what has worked in the past. Jim Rickards interviewed some "old money" in Europe recently and the answer was: <snip> We talk about the ‘old money’ in the U.S. , the 100 year money, and the ‘new money’. When you go to Europe, some of that money is 400 or 500 ye...

So... just a quick note to support Blue Ruins post. Gold does indeed act as a "insurance policy" if a currency should fail. The concerns about a currency failing is not new. Have a look at the link below, esp. Pg's 75 -78 The book was from the 1890's. https://archive.org/details/coinsfinan...

If it's not a Roth, there is such a thing as having too much in non-taxable. Now, it does all depend on what amounts you have saved by the time you hit the RMD age, but if you're projected to be quite affluent you really don't want to kick this can down the road. You want to plan for the tax implic...

Thanks Libertarian666,

Did you have any hard criteria to judge against when you exited the PP? Eg. P/E ratio >30, negative bond yields etc.

Or was it more of "This cannot go on forever" type feeling?

I asked the original question because I am interested in posters thought processes. Barrett is right. In the original post I was wondering about rebalancing into assets that could go all the way to zero. I suppose I see the PP as a bit like the Titanic. At the time "IT WAS" the safest ship...

Every gambler knows That the secret to survivin' Is knowin' what to throw away And knowin' what to keep 'Cause every hand's a winner And every hand's a loser I am sure many of you have heard that snippet from "The Gambler" lyrics. Now, since it's inception, the PP has been a winner howeve...