This is the best time in 45 years to invest in the Permanent Portfolio

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Wonk
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This is the best time in 45 years to invest in the Permanent Portfolio

Post by Wonk » Fri Oct 21, 2022 8:26 am

Hello All,

It's been years since I dropped by this forum but I felt the urge to do so in case anyone needed a pep talk. Consider this...

-The permanent portfolio rises steadily in all market environments with one exception: tight money. We're in the tightest money environment since 1980-1982.
-Tight money environments don't last forever.
-A cashless permanent portfolio is drawn down about 24% at present. This is the largest drawdown in 45 years!
-The average length of time for the largest 10 drawdowns in portfolio history is 8.6 months. We're going on 10 months currently.
-The average length of time to be underwater in this portfolio (before a full recovery) is 16 months. The longest was 23 months.
-The average return of the permanent portfolio the year after a loss is over 20%.
-If you go to portfolio visualizer, plug in the assets and look at the 45 year chart, it's back to it's trend--possibly even slightly below trend or undervalued in real terms.

I'm not saying the portfolio has hit bottom. Maybe there's more to go, maybe not. But I'd say with a high degree of certainty that we're a LOT closer to the cycle bottom than any other time in history. Anyone with cash sitting on the sidelines and a time horizon longer than a year needs to be plowing money back into this portfolio rather than listening to talking heads blather about which way everything will go. Block out the noise and tune into the signal.

This is a gift from the financial gods. Don't waste it.
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vnatale
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Re: This is the best time in 45 years to invest in the Permanent Portfolio

Post by vnatale » Fri Oct 21, 2022 9:00 am

Wonk wrote:
Fri Oct 21, 2022 8:26 am

Hello All,

It's been years since I dropped by this forum but I felt the urge to do so in case anyone needed a pep talk. Consider this...

-The permanent portfolio rises steadily in all market environments with one exception: tight money. We're in the tightest money environment since 1980-1982.
-Tight money environments don't last forever.
-A cashless permanent portfolio is drawn down about 24% at present. This is the largest drawdown in 45 years!
-The average length of time for the largest 10 drawdowns in portfolio history is 8.6 months. We're going on 10 months currently.
-The average length of time to be underwater in this portfolio (before a full recovery) is 16 months. The longest was 23 months.
-The average return of the permanent portfolio the year after a loss is over 20%.
-If you go to portfolio visualizer, plug in the assets and look at the 45 year chart, it's back to it's trend--possibly even slightly below trend or undervalued in real terms.

I'm not saying the portfolio has hit bottom. Maybe there's more to go, maybe not. But I'd say with a high degree of certainty that we're a LOT closer to the cycle bottom than any other time in history. Anyone with cash sitting on the sidelines and a time horizon longer than a year needs to be plowing money back into this portfolio rather than listening to talking heads blather about which way everything will go. Block out the noise and tune into the signal.

This is a gift from the financial gods. Don't waste it.


Welcome back, Wonk!

Thanks for all the above!
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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dualstow
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Re: This is the best time in 45 years to invest in the Permanent Portfolio

Post by dualstow » Fri Oct 21, 2022 11:30 am

[LIKE]
Let 2022 be the year of GOLD
Building dream churches with silver spires /And our rogue children are playing loaded dice
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Smith1776
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Re: This is the best time in 45 years to invest in the Permanent Portfolio

Post by Smith1776 » Fri Oct 21, 2022 12:25 pm

PP fo' life.
25% VVL | 25% KILO.B | 25% ZFL | 25% ZFS
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dualstow
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Re: This is the best time in 45 years to invest in the Permanent Portfolio

Post by dualstow » Fri Oct 21, 2022 3:23 pm

Smith1776 wrote:
Fri Oct 21, 2022 12:25 pm
PP fo' life.
I was about to joke that you have that tattooed on your arm a la "Thug Life." Please don't get a tattoo. O0
Let 2022 be the year of GOLD
Building dream churches with silver spires /And our rogue children are playing loaded dice
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Re: This is the best time in 45 years to invest in the Permanent Portfolio

Post by ppnewbie » Sun Oct 23, 2022 2:26 am

Great post!
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Smith1776
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Re: This is the best time in 45 years to invest in the Permanent Portfolio

Post by Smith1776 » Sun Oct 23, 2022 2:39 am

As much as I agree with the OP, the start date sensitivity of the PP is so low that I don't think it's ever a bad time to invest in it.
25% VVL | 25% KILO.B | 25% ZFL | 25% ZFS
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ochotona
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Re: This is the best time in 45 years to invest in the Permanent Portfolio

Post by ochotona » Sun Oct 23, 2022 11:36 am

I also think it's a good time also to be starting with the HBPP.
Kbg
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Re: This is the best time in 45 years to invest in the Permanent Portfolio

Post by Kbg » Sun Oct 23, 2022 7:19 pm

Whoa, Och is back. Good to see you.
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