Worst investing year ever...

General Discussion on the Permanent Portfolio Strategy

Moderator: Global Moderator

User avatar
Xan
Administrator
Administrator
Posts: 2165
Joined: Tue Mar 13, 2012 1:51 pm

Re: Worst investing year ever...

Post by Xan » Thu Dec 27, 2018 11:45 am

dualstow wrote:
Thu Dec 27, 2018 11:41 am
Xan wrote:
Thu Dec 27, 2018 9:48 am
dualstow wrote:
Thu Dec 27, 2018 8:53 am
A belated Merry Xmas and happy new year to you, Budd.
It's not belated; Christmas is twelve days long, starting Christmas Day. There's a song about it and everything.
Fair enough. O0 So are you celebrating the other eleven days, beside the partridge and turtledoves and whatnot?
Well, the tree is up, the house is decorated, the outside lights are up until the Epiphany. And on Sunday we'll be singing all the Christmas songs at church.
User avatar
dualstow
Executive Member
Executive Member
Posts: 8016
Joined: Wed Oct 27, 2010 10:18 am
Location: next to emotional support peacock
Contact:

Re: Worst investing year ever...

Post by dualstow » Thu Dec 27, 2018 12:06 pm

Sounds nice!
Venezuela’s Gold is Vanishing into Africa
User avatar
buddtholomew
Executive Member
Executive Member
Posts: 2048
Joined: Fri May 21, 2010 4:16 pm

Re: Worst investing year ever...

Post by buddtholomew » Thu Dec 27, 2018 3:43 pm

buddtholomew wrote:
Thu Dec 27, 2018 8:15 am
Stocks down, Gold and LTT’s up at end of pre-market.

Will the day end this way or should we expect to see a reversal with stocks ending up, Gold and LTT’s flat to down? The question to ask yourself...”is this pattern actionable.”
Can we continue to ignore this pattern?
Borderline ridiculous, right?
Intra-day PP swing of -.71% to +.48% (quite impressive, too bad I was taking a nap to watch it happen in real-time) ;D
DragonJoey3
Full Member
Full Member
Posts: 55
Joined: Wed Dec 05, 2012 3:00 pm

Re: Worst investing year ever...

Post by DragonJoey3 » Fri Dec 28, 2018 2:50 pm

buddtholomew wrote:
Thu Dec 27, 2018 3:43 pm
buddtholomew wrote:
Thu Dec 27, 2018 8:15 am
Stocks down, Gold and LTT’s up at end of pre-market.

Will the day end this way or should we expect to see a reversal with stocks ending up, Gold and LTT’s flat to down? The question to ask yourself...”is this pattern actionable.”
Can we continue to ignore this pattern?
Borderline ridiculous, right?
Intra-day PP swing of -.71% to +.48% (quite impressive, too bad I was taking a nap to watch it happen in real-time) ;D
Hey Bud! Hope you had a Merry Christmas. Here is my perspective on what is happening.

1. The FED is raising interest rates (by definition that's bad for long-term treasuries) so LTT is going to be DOWN
2. Point #1 means that inflation is less likely, the FED is trying to get ahead of inflation and plans to raise rates to combat it so gold is DOWN
3. The market fears that the fed is a bit over-zealous and aiming towards deflation so the market is DOWN
4. Cash is king! Literally every asset class has suffered except CASH this year it seems. CASH is UP, and T-bills are yielding over 2.4% for me now

So going back to the basis of the portfolio, what economic circumstance are we in?

Prosperity? (seems like that is coming to an end, certainly the era of easy money is)
Recession? (maybe in the future, but certainly not in one right now)
Inflation? (again seems the fed has that under control, or trying at least)
deflation? (seems like the most likely of the 4 states)

The PP remains apathetic to all of this and thus we still hold long-term treasuries despite rising rates, and we hold gold despite inflation expectations being hampered by those same rates, and we hold cash just in case as this thread talks about everything else is down.

Cash (T-bills in particular) will go down as one of the best performing asset classes of 2018. That in my opinion is a strong sign of the wisdom of the PP.

Full Disclosure: I have migrated to the "Golden Butterfly" approach as advocated by Tyler on his website because I felt that I was under-exposed to equities for my higher risk tolerance. i.e. I considered the risk of losing out on returns greater than the risk of me selling in a bear market.
User avatar
I Shrugged
Executive Member
Executive Member
Posts: 585
Joined: Tue Dec 18, 2012 6:35 pm

Re: Worst investing year ever...

Post by I Shrugged » Fri Dec 28, 2018 6:52 pm

^^^
Great post.
User avatar
mrbk2fi
Junior Member
Junior Member
Posts: 8
Joined: Tue May 22, 2018 1:05 pm

Re: Worst investing year ever...

Post by mrbk2fi » Fri Dec 28, 2018 6:55 pm

+1

I also have extra exposure to equities. My equity exposure is 30% US 30% ROW (including emerging markets). The remaining 40% is divided equally between Gold, LTT, and STT.

I am very comfortable with this tilt toward equities and international stock exposure.
User avatar
sophie
Executive Member
Executive Member
Posts: 2986
Joined: Mon Apr 23, 2012 7:15 pm

Re: Worst investing year ever...

Post by sophie » Sat Dec 29, 2018 10:56 am

Ha, only on this forum can a 30-40% stock allocation be considered going out on a limb :-)

At the family Christmas party, the subject of the stock market came up. At one point someone asked me "How come you're so calm about this? We're all stressed out because our retirement accounts are vanishing before our eyes!"

Thank you Harry Browne! And Tyler, because I'm working toward Golden Butterfly-land also.
User avatar
dualstow
Executive Member
Executive Member
Posts: 8016
Joined: Wed Oct 27, 2010 10:18 am
Location: next to emotional support peacock
Contact:

Re: Worst investing year ever...

Post by dualstow » Sat Dec 29, 2018 11:10 am

O0
Venezuela’s Gold is Vanishing into Africa
User avatar
Tyler
Executive Member
Executive Member
Posts: 1699
Joined: Sat Nov 12, 2011 3:23 pm
Contact:

Re: Worst investing year ever...

Post by Tyler » Sat Dec 29, 2018 12:21 pm

sophie wrote:
Sat Dec 29, 2018 10:56 am
At the family Christmas party, the subject of the stock market came up. At one point someone asked me "How come you're so calm about this? We're all stressed out because our retirement accounts are vanishing before our eyes!"

Thank you Harry Browne! And Tyler, because I'm working toward Golden Butterfly-land also.
;D

Congrats on setting a good example! Data only goes so far, and IMO there's no better way to evangelize wise investing techniques than to have people take notice of your distinctive lack of stress.
PortfolioCharts.com : a picture is worth a thousand calculations
Jeffreyalan
Full Member
Full Member
Posts: 83
Joined: Sat Sep 10, 2016 1:50 pm

Re: Worst investing year ever...

Post by Jeffreyalan » Sat Dec 29, 2018 10:52 pm

Any love here for The Desert Portfolio that has outperformed the PP since 2008 with less volitility?
bedraggled
Executive Member
Executive Member
Posts: 532
Joined: Sat Sep 13, 2014 4:20 am

Re: Worst investing year ever...

Post by bedraggled » Sat Dec 29, 2018 11:24 pm

Hi, Folks and Tyler,

Am i wrong but it seems the Desert Portfolio has been removed from Portfoliocharts.com.

The Desert Portfolio is a lovely portfolio.

I may not be looking in the correct place. Wouldn't be the first time.

Thanks.
User avatar
Tyler
Executive Member
Executive Member
Posts: 1699
Joined: Sat Nov 12, 2011 3:23 pm
Contact:

Re: Worst investing year ever...

Post by Tyler » Sat Dec 29, 2018 11:44 pm

bedraggled wrote:
Sat Dec 29, 2018 11:24 pm
Hi, Folks and Tyler,

Am i wrong but it seems the Desert Portfolio has been removed from Portfoliocharts.com.

The Desert Portfolio is a lovely portfolio.

I may not be looking in the correct place. Wouldn't be the first time.

Thanks.
Good eye. Yes, I recently removed the Desert Portfolio from Portfolio Charts. It's still a wonderful asset allocation, but as the site grows I'm being a little more picky about the portfolios I curate for the list. Having things like books I can point to helps keep things looking professional. ;)

But as thanks to Desert and the rest of the group here, here's a permanent link to the page with the historical data: https://portfoliocharts.com/portfolio/desert-portfolio/
PortfolioCharts.com : a picture is worth a thousand calculations
Post Reply