Gyroscopic Investing

IE is the only browser my employer allows on its computers, and they haven't upgraded in a long time, so we're stuck with an old version.  I use Chrome at home thanks to your suggestion, and I'm much happier.

By the way, I should have pointed out that for the PP, GTU may be better than GLD due to the discount/premium thingy.  When gold is riding high and you're ready to sell some to rebalance, it will likely be at a premium, so you will get a better selling price.  When gold is low, and you're rebalancing into it, it will likely be at a discount, so you will get a better buying price.  Of course, in practice it won't always work exactly like the theory, but it shouldn't be too far off.

stuper1 wrote: By the way, I should have pointed out that for the PP, GTU may be better than GLD due to the discount/premium thingy.  When gold is riding high and you're ready to sell some to rebalance, it will likely be at a premium, so you will get a better selling price.  When gold is low, and you're rebalancing into it, it will likely be at a discount, so you will get a better buying price.  Of course, in practice it won't always work exactly like the theory, but it shouldn't be too far off.

I agree, and do this myself, but I hedge my bets by also holding IAU and physical.

Also, ouch!



A day after the Fed's soothing words pumped it up, no less.

With a few more days like today, I predict a surge of new interest in the PP. 

Tyler wrote: With a few more days like today, I predict a surge of new interest in the PP. 

Not so fast. The rest of the components didn't offer much support. Equities down 2.07, Gold up .14 and LTT's down .4.

Treasury yields moved up on a 300 point decline AND the stronger dollar. Can you imagine if the EU had cut rates...we'd be down 1000.

The support doesn't necessarily come in lockstep with the declines.  Give it a little while to show up.  I like to use peaktotrough.com, focusing on the line showing the overall PP performance and including say a decade of history along with recent results.  The PP doesn't always go upward, but the down parts are much smaller and briefer compared to most other portfolios.

buddtholomew wrote:

Tyler wrote: With a few more days like today, I predict a surge of new interest in the PP. 

Not so fast. The rest of the components didn't offer much support. Equities down 2.07, Gold up .14 and LTT's down .4.

Treasury yields moved up on a 300 point decline AND the stronger dollar. Can you imagine if the EU had cut rates...we'd be down 1000.

not to mention GTU down .3%    I have a surge of new interest in hitting my head against my desk

I haven't seen stocks move like this since Shakira's "Hips Don't Lie": https://www.youtube.com/watch?v=DUT5rEU6pqM

dragoncar wrote:

buddtholomew wrote:

Tyler wrote: With a few more days like today, I predict a surge of new interest in the PP. 

Not so fast. The rest of the components didn't offer much support. Equities down 2.07, Gold up .14 and LTT's down .4.

Treasury yields moved up on a 300 point decline AND the stronger dollar. Can you imagine if the EU had cut rates...we'd be down 1000.

not to mention GTU down .3%    I have a surge of new interest in hitting my head against my desk

Lol.  Relax guys -- I'm just stirring the pot.  It's a fun day for knee-jerk threads on various investing boards. 

Seems like just yesterday I was feeling bad about taking profits. I had not hit exactly 35% in stocks, and I also only did a half-assed rebalance, preferring to ease into it and finish at the point where the stock share would have hit 35%. That day never came. I really thought stocks would go wild after breaching 2000  (S&P). Needless to say, now I feel great about the premature rebalancing that I did do.

dualstow wrote: Seems like just yesterday I was feeling bad about taking profits. I had not hit exactly 35% in stocks, and I also only did a half-assed rebalance, preferring to ease into it and finish at the point where the stock share would have hit 35%. That day never came. I really thought stocks would go wild after breaching 2000  (S&P). Needless to say, now I feel great about the premature rebalancing that I did do.

That's good to hear. I was waiting for my stock allocation to hit the 35% rebalance band, and it got pretty close--but then, just short of the mark, stocks started falling like a rock.

This is making me consider switching to 20/30 rebalance bands going forward.

Tortoise wrote: That's good to hear. I was waiting for my stock allocation to hit the 35% rebalance band, and it got pretty close--but then, just short of the mark, stocks started falling like a rock.

This is making me consider switching to 20/30 rebalance bands going forward.

Funny -- I had the opposite reaction.  Probably because I've been preparing myself for early retirement by working out strategies to minimize taxes, I tend to view rebalancing these days not as a profit capturing activity but as a (potentially) sizable expense.  If the PP keeps growing within the 15/35 bands while needing a rebalance only very rarely, that would be a fine outcome.  Or maybe I'm just lazy and thankful the markets may save me the effort for a while longer. 

I don't have enough income to worry about taxes from investments. 15% bracket.

Yep.  Once my income drops, it's a new ballgame.  No tax excuses -- it'll be 100% laziness on my part. 

In all seriousness, though, I do like how the bands keep me from making unnecessary transactions.  I plan to stick to them for a while and worry about other things.

For those of you who don't peek at the noise but who read the forum: stocks were up 2.4% today, a 400+point climb for the Dow.

dualstow wrote: For those of you who don't peek at the noise but who read the forum: stocks were up 2.4% today, a 400+point climb for the Dow.

thanks, Janet!

Irrational exuberance?

thanks, Janet!

I'm sorry, I don't get the reference.
----
Irrational exuberance, no doubt! I do hope it carries on a while longer.

dualstow wrote:

thanks, Janet!

I'm sorry, I don't get the reference.
----
Irrational exuberance, no doubt! I do hope it carries on a while longer.

Fed Chairmand Janet Yellen or a cross between Phil Donahue and Danny DaVito.

Oh, of course! Thank you, Budd. And I apologize for the brain freeze, Murphy. 

We're definitely witnessing traditional topping behavior. 

Two V-shaped deflections in the span of about two months.

Recently, it took just two days to erase six days of losses in the S&P 500.

And it took only two days for the R2K to hit an almost 6-month high.

Cocktail party chatter is now about how they are the next Warren Buffett.

So, I say it feels like we're at the bottom of the 7th inning.  If "Game Over" doesn't happen by the next "Sell in May" signal, we're truly witnessing a miracle of epic proportions.

I noticed martin armstrong today had a post of a possible drop until may. I might put a short on.

http://armstrongeconomics.com/2015/01/0 ... -5-months/

Try not to play with your PP. Balance on schedule and try not to think. This is the best way.

I suppose today is a good day for Lowe, who is tired of the steadily climbing stock market. Dow down 316 pts. S&P down 1.64% whoops, numbers are still coming in. Both down more than that.

Very strange, I should be just as upset that stocks are down this much as when gold goes down this much.  But I am not.

I am going to have to think about why that is! 

Maybe because it has become a given that tomorrow will be a 400 point up day...

Maybe not...