PSA: I now have a 3-year period with no gains

[KevinW]

Why do that? 

Please stop.

+1

[Jack Jones]

This is why I complain about absent management here at the forum. After Craig and MT spent so much time and energy promoting the PP and setting up a website for it they now disappear for months at a time as if they never had such a great effect on getting us to join in. When the PP has underperformed the general stock market by over a hundred percent is when we need to hear from them. Not when things are going well.  I'm not talking about a full time commitment here, just an occasional post or two on a regular basis. I'd actually like to know why they stopped doing that.  Have they themselves become demoralized with the PP?

Perhaps you'd feel better if you realized that they don't owe you anything. Their book didn't come with a lifetime support contract.

[buddtholomew]

Why do that? 

Please stop.

+1

Why don't you read what he wrote or are you just being selective?

[MediumTex]

i am not picking on them or the pp but in general things only work until they don't whether it is moving averages , technicals or the best trading system in the world .

the pp had a great run because of 40 years of falling interest rates except for a few bumps and a strong stock market .

well perhaps it too met its waterloo . it just took a lot longer .

The PP's best years in nominal terms have happened when interest rates were rising.

"It only works when interest rates are falling" is not a valid criticism of the PP.

they did not rise very long , just look at that slope  . that is bliss for long term treasury's over the long haul .

If you take the chart back to 1972, you will see that rates rose for a decade before they peaked in the early 1980s.

It was during that decade that the PP delivered its highest returns in both real and nominal terms.

[MediumTex]

forget the charts , it all boils down to this :
the question you have to ask yourself is do you believe conditions are such that you want to stick with it or does your gut tell you there may be better options .

that is all that matters . driving and looking in the rear view mirror may mean nothing today with any asset class things are so different than the past including global interaction on the various pieces of the pp .

I agree with this statement, except the part about things being so different now.

To me, current conditions are exactly the same as we have been dealing with since 2008.  Nothing new here at all.

The PP showed it could weather this storm in 2008, and then it showed that it could thrive in a deflationary environment after that. 

[KevinW]

Why don't you read what he wrote or are you just being selective?

Before saying something, please consider asking yourself: will this add productively to the discussion? If not, it would be a kindness to not say that thing.

We have a nice community here. A little common courtesy would go a long way.

[buddtholomew]

Why don't you read what he wrote or are you just being selective?

Before saying something, please consider asking yourself: will this add productively to the discussion? If not, it would be a kindness to not say that thing.

We have a nice community here. A little common courtesy would go a long way.

So did you read it? You get what you give...

[dualstow]

Why don't you read what he wrote or are you just being selective?

It looks like I might be the 'he' in question -- hard to untangle these quote nests sometimes -- so just to clear the air:

- I really do mean that for the time being, the theory that global conditions will overwhelm the pp are just that, a theory. I don't understand why your interpretation of current economic events have any more weight than mortalpawn's or anyone else's. ?
- If I offended you by saying that I like to buy in "when Budd is running in the streets", I didn't mean to. It's just a bad pun, but it's also the truth. I like to put money into the pp when it's low and unpopular. Isn't that what we're supposed to do, after all? We do it with the four assets (rebalancing bands), so why not w/ the pp itself?

[buddtholomew]

Why don't you read what he wrote or are you just being selective?

It looks like I might be the 'he' in question -- hard to untangle these quote nests sometimes -- so just to clear the air:

- I really do mean that for the time being, the theory that global conditions will overwhelm the pp are just that, a theory. I don't understand why your interpretation of current economic events have any more weight than mortalpawn's or anyone else's. ?
- If I offended you by saying that I like to buy in "when Budd is running in the streets", I didn't mean to. It's just a bad pun, but it's also the truth. I like to put money into the pp when it's low and unpopular. Isn't that what we're supposed to do, after all? We do it with the four assets (rebalancing bands), so why not w/ the pp itself?

Yes, you're right and I apologize.
I've been buying lagging assets as well after I get tired from running in the streets.

[AdamA]

Don't waste your breath Math.
The diehards here will tell you everything is great.

But isn't this the right attitude?  You sort of have to be a "diehard" of whatever investment strategy you choose. 

Whether it's 100% stocks,  50/50 BH, the PP or any other strategy, the argument could be made that more damage is done by running from strategy to strategy every time you get scared than from picking one and sticking it to it, even if it's not the optimal portfolio. 

[dualstow]

No harm done. And we've both got roofs over our heads and food in the fridge. That means we're doing way better than most of the world's population.

[MediumTex]

No harm done. And we've both got roofs over our heads and food in the fridge. That means we're doing way better than most of the world's population.

That's not enough.

I want to see you two share a grudging fist bump.

[MediumTex]

Don't waste your breath Math.
The diehards here will tell you everything is great.

But isn't this the right attitude?  You sort of have to be a "diehard" of whatever investment strategy you choose. 

Whether it's 100% stocks,  50/50 BH, the PP or any other strategy, the argument could be made that more damage is done by running from strategy to strategy every time you get scared than from picking one and sticking it to it, even if it's not the optimal portfolio.

Absolutely.

One of the risks I am willing to take with the PP is that I have hitched my wagon to a tortoise.

I'm okay with the notion that I am going to be passed regularly by other wagons being pulled by other means.

The worst investment decisions I have ever made have not involved choosing the wrong portfolio, it has been switching portfolios at the wrong time.

[AdamA]

When the PP has underperformed the general stock market by over a hundred percent is when we need to hear from them. Not when things are going well.  I'm not talking about a full time commitment here, just an occasional post or two on a regular basis. I'd actually like to know why they stopped doing that.  Have they themselves become demoralized with the PP?

What is it you'd want to hear from them?

[dualstow]

I want to see you two share a grudging fist bump.

Not fair. Have you seen the size of his arms? 

[MediumTex]

When the PP has underperformed the general stock market by over a hundred percent is when we need to hear from them. Not when things are going well.  I'm not talking about a full time commitment here, just an occasional post or two on a regular basis. I'd actually like to know why they stopped doing that.  Have they themselves become demoralized with the PP?

What is it you'd want to hear from them?

Yeah.

I have recently been posting about topics ranging from interest rate trends, reasons to own gold, how the PP will do in a sustained deflationary environment, whether God exists, and a geriatric strip club/bingo parlor with a featured dancer who shoots the next bingo ball from her special purpose (they are actually making a documentary about this amazing place called "Dancing at the Blue Hair-guana").

[mathjak107]

i believe a local nyc club here got closed down because a dancer shot one in someones pizza .

not that i think thats a problem    lol

[MediumTex]

i believe a local nyc club here got closed down because a dancer shot one in someones pizza .

not that i think thats a problem    lol

It's all fun and games until someone gets an eye put out.

[mathjak107]

talk about being cock eyed .

[sophie]

Wow you guys...can I ask why portfolio badness should make everyone so irritable?  It really should not be ruining your day like this.

Totally agree with goodasgold.  I think we've all seen enough of Tyler's charts that any portfolio (Desert, PP, Bogleheads, 100% stocks, etc) can produce negative real returns over multi-year periods.  If anyone can tell me what portfolio can absolutely guarantee strong returns over all three+ year periods, please do tell.

Frankly I kind of expected something like this.  2008 produced a huge boost to gold and Treasuries that resulted in several years of outsized returns for the PP.  As for many others on this forum (me included), these returns looked like a wonderful bit of magic and it attracted us to the PP.  Many of us bought into the PP just after that glorious "PP bull market".  Now, these assets are reverting to where they probably should be.  Not so good for us latecomers!

I still think the fundamentals of the PP are sound.  It is currently behaving as if there is a "tight money" condition prevailing.  At this point I'm planning to stay in and continue to plow new savings into lagging assets.  I have the feeling that something very, very interesting will happen eventually, and if you imagine yourself 5 years from now looking back at today, you may well regret having sold off those unconventional gold and bond assets.

[mathjak107]

except we are not in a tight money situation , we are in the loosest money situation in history at zero . that says to me something is wrong if we are now getting opposite results in the pp .

you can't have the tail wag the dog . you are trying to find an economic condition to apply to the pp  when that label is the exact opposite of conditions .

[Reub]

I'd like to see the same conviction from them as when they were making hundreds and hundreds of posts on the Bogleheads site and writing a book on the subject. After all, they created this website and persuaded most of us to invest in this manner. I just feel that for the two of them to disappear literally for months at a time when the PP has gone absolutely nowhere for 3 years and has returned  100+% less than stocks since 2009 borders on negligence. It just seems that they have less or no interest in the PP these days and possibly for us.

When will I be banned again for these comments?

[mathjak107]

i think we all get your  point and no need to chastise them  they only brought folks an education on it ..  after all no one should make investments or stay in investments they think are not meeting goals .

the concept of the  pp was fine for decades . it was never a growth vehicle , it was a positive real return vehicle and it did just that .

but anyone who thinks anything works forever as the world changes without seeing if it is still up to par and makes sense  is the problem not the fact they are not hand holding or running a support group .


they introduced you to someone else s strategy  and gave you an education on it . that does not mean the world will not change an make it no longer work in the manner it was designed .

in fact it is only my opinion that it no longer works well .

[drumminj]

After all, they created this website and persuaded most of us to invest in this manner. I just feel that for the two of them to disappear literally for months at a time when the PP has gone absolutely nowhere for 3 years and has returned  100+% less than stocks since 2009 borders on negligence.

Yikes.  Perhaps I'm mis-reading your tone (and a few folks seem to express this expectation), but what is it that Craig or Tex owe you?  Did they say "Reub, you should be in the PP!!!".  I'm guessing no -- you *chose* to allocate your investments in the PP, based on input you surely got from several sources - BH, here, books, etc. But it was your choice!

If anyone who expresses an opinion you choose to incorporate into your own world-view is guilty of negligence due to not continually defending that opinion (for the rest of their life?), then why would anyone ever express an opinion?

I read the massive BH thread. I've read Craig and Tex's book.  I've read HB's books.  No one owes me anything though -- I made the choice on my own to allocate my funds this way.  I bought into the thinking and arguments, and determined they made sense to me.  If they don't work out, it's my own judgement/decision to blame -- not the folks simply expressing their personal opinions.

If you want someone to make the decisions for you that you can blame after the fact, hand your funds to a money manager and pay their fees.  You can at least claim they have a fiduciary responsibility to you!!!

[sophie]

I don't know about you, but they didn't persuade me.  I gathered all the info available, examined asset performance charts, and made my own decision.  No one should choose an investment plan based on someone else's opinion.  Unfortunately I learned that the hard way in 1999, when I ended up losing about $100K in retirement funds.  And then like a completely pig-headed idiot, I got a refresher course when I bought a stock at my Wall Street uncle's urging, and lost about $20K.

In comparison to those experiences, 3 years with only small gains evokes little more than mild disappointment.  Not to mention that I'm loving being totally immune to the panicked-sounding headlines, and about as insured as I'll ever be against the big losses that can really wipe you out.