I'm Done!

[dualstow]

Mine was set up on March 13, almost exactly two months ago.  It's down about 1.4%.  But I'm still glad I'm in it, and plan to keep contributing.

...It probably helps that I moved to this from 100% gold, so obviously the status quo would have been much, much worse.  Picked a good time to admit that market timing doesn't work!  :-)

Hah! So you accidentally had very good market (diversification) timing.

[Alanw]

Down, down, down...further into the abyss. Is hope a strategy?

Budd,
Having savings and investable assets can either be a blessing or a curse.  Some will see it as a blessing and a means to an end where they will enjoy attempting to achieve positive returns and eventually enjoy the fruits of their labor and the savings that have accrued over the years.  Others that have achieved a fair amount of financial assets will worry continuously about how and what to invest in and be so fearful of loss that they would be better off never having accumulated the assets in the first place.

The trick is finding a balance.  If you feel you need to invest rather than be in all cash or bonds, the PP appears to be a good low risk alternative.  Being in all cash or bonds as well as many other investment alternatives would seem to be much riskier than the PP.

I have a number of friends that have earned a lot of money during their working lives and have spent every nickle of it.  They have had fancy cars, big houses and lavish vacations.  Now, they have virtually nothing in retirement funds and must work to maintain their lifestyle.  I have other friends who have saved and invested over their lives and now have options as far as work and lifestyle.  I do not wish to presume which method is correct.  What works for some may not work for others.  Again, the trick is finding a balance.

For me, saving and investing over the years has provided many options now that would not have been possible had I consumed beyond my means, but I do not wish to worry so much abount losing my retirement funds that I cannot enyoy my life. If a certain set of events were to occur that I were to lose most or all of my retirement funds, I would adjust my lifestyle and look for other work or income opportunities.  I intend to be happy no matter how much or how little money I have.

P.S.  I still look at my portfolio way to often.

[t-bear52]

It's funny. Didn't try but felt like I must have tried to time the market!! I went all in at Gold's top in March. Down 2.26 %. Bad timing in the short term. I'm sure it will come around!

I still look too often but glad to be in PP.  But I have my  moments........... 

[Pointedstick]

I find it difficult to believe that other PP investors do not experience similar visceral emotions when the portfolio declines over a time period (2-5 days or more). Have others bought into the PP philosophy enough to see declines and not have any doubt? I realize that I have an emotional tie to money, but am I the exception. What other coping mechanisms do others use besides looking less frequently (head in the sand).

Something that helped me was realizing that I hadn't actually lost anything until I sold. It's easy to panic when you see the numbers going down, but it's all funny money until you actually sell; that's when you lock in your gains or losses. Once I started thinking about it this way, it became much easier for me to talk myself down from pulling the trigger to "get out while I still can", thus locking in the loss.

I know you've mentioned before that your PP is replacement income for if you ever lose your job, and you react negatively to your balance decreasing because it lessens your ability to weather prolonged unemployment, which is totally understandable. But here's a question: do you actually fear the imminent loss of your job? Or is is just a more generalized worry? It seems like you need to decouple the portfolio from the emotional roller coaster it's attached to by either realizing that your job is at least reasonably secure, working to make it secure, or cushioning yourself from its loss by cultivating contacts in the industry or learning skills for a new job. Or even start a side business. I started one at the beginning of the year and it's done wonders for my mental health. If I lost my job, at this point I could very nearly replace my income, and I could move to a much cheaper area, too.

[MikeK]

Hi all,

I started my CA PP in mid-January 2012.

Ditto!  Of course Gold was the hardest pill to swallow and it's currently down 10%!  However, I'm planning on putting more of my assets in the PP and figure that Gold is 'on sale' now comparatively to when I bought it 3.5 months ago....

When I start to feel anxious about it, I try to look at the bigger picture and another 10 years before we have to draw from the portfolio.
I also find this forum itself calming to feel the support and hear the knowledge of people that have been investing in the Permanent Portfolio for years and have alot more financial and investment knowledge than I.

Very good perspective to keep!  And I also appreciate the wisdom of those on this forum when the doubts start to creep in....

mike

[metta2006]

Can I seek some advice from the experienced? I'm stressed out and I'm not sure how to be a worry free ppier.

I really wish I didn't have to check the market everyday and got stressed out because I don't really have time and energy for this. But the reason why I keep checking is that I still have more money to invest and wanted to do DCA over 10months. And every month I'm trying to buy the assets that have gone down. And I buy them and they keep going further down. So now I'm discouraged to buy gold and stocks as they keep drifting lower but then I'm reluctant to buy LTT as it seems very overpriced.

When you are just adding more money to the pp, does it make sense to buy lagging assets but not sell the well performing asset (in this case LTT)? Is it still rebalancing and supposed to work?

If you have half of your cash invested in pp and 10K to add every month for the next 10 month, would you pick a random day and just buy 3 assets to bring them all up to 25%? Or would you check the market often and try to buy lagging assets little by little (considering that I don't have to worry about trading fees). What would be the best DCA strategy that will not cause much stress? I decided to DCA because for psychological reason but then now I'm too stressed out about making decisions what to buy and when everyday and every month especially when I have little time to do trading during the day.

I thought about buying all assets at once, but the one thing I would rather not do is to buy more than 1oz gold at a time as I need to show my ID to the dealer. But I have been buying gold at dips but it keeps going lower.

Thanks a lot in advance!

[sk55]

Hi metta,

you could space out your DCA more..  i do mine every 3 months, that way i don't have to stress about what to buy to often.

Stop watching the pundits on cnbc helps alot too!

Since i started using PP, i have a more detached attitude towards the markets, i see these pull backs as an opportunity to buy more assets at better price.

[Gosso]

Hi metta,

you could space out your DCA more..  i do mine every 3 months, that way i don't have to stress about what to buy to often.

That's good advice.  I have a few short term bonds expiring on June 1, so I have set this date as a forced rebalancing point to deploy my build-up of cash (I'm at 32% cash at the moment, which is far too conservative for myself).

Metta, you could try setting a few predetermined dates on when you'll add new money.  This takes all the guess work out of it -- you have even odds of picking a low, medium, or high spot.

[MediumTex]

Nice day for the PP so far.

[Xan]

Huzzah!

[moda0306]

I always buy 2x PP funds when Budd has one of his meltdowns... It's proven a remarkable timing tool.  I think HB actually might have approved.

Jk, Budd.

[buddtholomew]

I always buy 2x PP funds when Budd has one of his meltdowns... It's proven a remarkable timing tool.  I think HB actually might have approved.

Jk, Budd.

I don't appreciate this comment even if it was made jokingly. From now on I will not share my personal emotions with other members of this board.

Edited to remove inappropriate comment.

[Alanw]

I always buy 2x PP funds when Budd has one of his meltdowns... It's proven a remarkable timing tool.  I think HB actually might have approved.

Jk, Budd.

I don't appreciate this comment even if it was made jokingly. From now on I will not share my personal emotions with other members of this board. To you Moda, go fcuk yourself! j/k

Easy Budd,
We enjoy your comments. I'm sure Moda had nothing malicious in mind so keep posting.

Check out a MT thread from last August "I did it for doodle".  I thought that one was rather humorous.

[buddtholomew]

I always buy 2x PP funds when Budd has one of his meltdowns... It's proven a remarkable timing tool.  I think HB actually might have approved.

Jk, Budd.

I don't appreciate this comment even if it was made jokingly. From now on I will not share my personal emotions with other members of this board. To you Moda, go fcuk yourself! j/k

Easy Budd,
We enjoy your comments. I'm sure Moda had nothing malicious in mind so keep posting.

Check out a MT thread from last August "I did it for doodle".  I thought that one was rather humorous.

What makes you think I was not joking around as well? I used j/k at the end of my sentence...isn't everything OK now? It's called being passive-aggressive and is definitely not appreciated!

[moda0306]

I always buy 2x PP funds when Budd has one of his meltdowns... It's proven a remarkable timing tool.  I think HB actually might have approved.

Jk, Budd.

I don't appreciate this comment even if it was made jokingly. From now on I will not share my personal emotions with other members of this board. To you Moda, go fcuk yourself! j/k

Not sure how much you were joking, but I certainly didn't mean to offend you or undermine your emotions, though in hindsight that's obviously what was happening.  My friendships are built on a lot of picking fun at the people I like/love the most and them to me... I'm known to take it too far from time to time.

I should have realized that this is a pretty tough emotional issue for you... not something people should poke fun at.  Sorry and I hope the emotions subside.  I don't have enough savings to get emotional about much ... so I can only sympathize... which I sometimes clumsily lack until I've said something stupid.

[buddtholomew]

I always buy 2x PP funds when Budd has one of his meltdowns... It's proven a remarkable timing tool.  I think HB actually might have approved.

Jk, Budd.

I don't appreciate this comment even if it was made jokingly. From now on I will not share my personal emotions with other members of this board.

Not sure how much you were joking, but I certainly didn't mean to offend you or undermine your emotions, though in hindsight that's obviously what was happening.  My friendships are built on a lot of picking fun at the people I like/love the most and them to me... I'm known to take it too far from time to time.

I should have realized that this is a pretty tough emotional issue for you... not something people should poke fun at.  Sorry and I hope the emotions subside.  I don't have enough savings to get emotional about much ... so I can only sympathize... which I sometimes clumsily lack until I've said something stupid.

Thank you for taking the time to apologize. Water under the bridge unless the portfolio ends in the red this afternoon I'm also removing my comment from the above post as it was clearly written in anger and inappropriate.

[Alanw]

I don't appreciate this comment even if it was made jokingly. From now on I will not share my personal emotions with other members of this board. To you Moda, go fcuk yourself! j/k

Easy Budd,
We enjoy your comments. I'm sure Moda had nothing malicious in mind so keep posting.

Check out a MT thread from last August "I did it for doodle".  I thought that one was rather humorous.

What makes you think I was not joking around as well? I used j/k at the end of my sentence...isn't everything OK now? It's called being passive-aggressive and is definitely not appreciated!

Sorry, I missed the j/k.
Just trying to keep it light and looking for the humor in most of life's situations.

[melveyr]

I think I enjoy the PP the most when LTT are doing the heavy lifting. I feel like its a big middle finger to most of the financial media and "very serious" economists. The chart of TLT is just remarkable.

[MediumTex]

Easy Budd,
We enjoy your comments. I'm sure Moda had nothing malicious in mind so keep posting.

Check out a MT thread from last August "I did it for doodle".  I thought that one was rather humorous.

What makes you think I was not joking around as well? I used j/k at the end of my sentence...isn't everything OK now? It's called being passive-aggressive and is definitely not appreciated!

Sorry, I missed the j/k.
Just trying to keep it light and looking for the humor in most of life's situations.

The bottom line is today is a good day.  I'm sure budd is feeling relieved, even if it's only for today (I have no idea what tomorrow will bring).

One of the things I like about the PP is the indifference toward the markets that it gradually cultivates in an investor.  Once you get it, it's wonderful--there is almost a zen-like quality to looking at something that others perceive almost exclusively through a prism of greed and/or fear, and to feel neither of these emotions in the slightest.  I'm not saying that to suggest that the PP is somehow a risk-free approach to investing, I'm just saying that this state of mind has been a pleasant by-product of PP investing and it is something that I hope others can experience as well.  

IMHO, this low level of stress is the very best thing about the PP.  I honestly don't care that much about the difference between 7% a year and 15% a year when compared to my day-to-day overall peace of mind.  If you told me I could have 15% a year return on my investments and live a life filled with mental anguish and psychological distress, or I could have a 7% return and live a life of inner peace and equanimity, I would take the 7% return every time, because I know that what typically happens is that anyone who signs up for the 15% program tends to quit in exhaustion at the worst possible time and rarely actually gets the 15% return that was promised in the first place.  

How many of you have seen this pattern, either in yourselves or in others of being gripped by fear or greed at the worst possible time?  Once you become sensitized to it, it's almost painful to watch in others--people suddenly begin to look like shell-shocked gamblers wandering around a casino at 4:00am looking for that streak of luck that left them around midnight while pit bosses who all resemble Lloyd Blankfein try to conceal their glee.  Once you fully grasp what a scam most of "investing" actually is, it's sort of like in They Live when Roddy Piper first put on the glasses.

[moda0306]

I think I enjoy the PP the most when LTT are doing the heavy lifting. I feel like its a big middle finger to most of the financial media and "very serious" economists. The chart of TLT is just remarkable.

^ That.

We might see our reckoning, melveyr, but I'd be willing to bet a tidy sum on the interest rate & inflation debate.

[Gumby]

I don't think it's entirely wrong to say that Permanent Portfolio dips tend to result in Permanent Portfolio rallies. Of course, that's not a given, but it does tend to happen more often than not. So, while Budd's emotions are doing a roller coaster ride, you can kind of see where the roller coaster is going most of the time.

[murphy_p_t]

i have to admit that i sold some EDV...right around its recent low...I'm glad I only sold 1/2 the position.

[AdamA]

I don't appreciate this comment even if it was made jokingly. From now on I will not share my personal emotions with other members of this board.

Budd--

I hope you don't stop posting. I think it's admirable that you post your honest feelings for us all to see.  I'm sure you're not the only one who has thoughts like this.  This thread has been around for months and is now 12 pages long, so obviously people are getting something from it.

[MediumTex]

I don't appreciate this comment even if it was made jokingly. From now on I will not share my personal emotions with other members of this board.

Budd--

I hope you don't stop posting. I think it's admirable that you post your honest feelings for us all to see.  I'm sure you're not the only one who has thoughts like this.  This thread has been around for months and is now 12 pages long, so obviously people are getting something from it.

Ditto.  Budd's comments have facilitated a great discussion.

[MachineGhost]

Budd,

The PP dropped something like 15% in 2008, mid-year.  I would load up much more heavily on T-bills and start maxing out your I Bonds until a 15% dip in everything else doesn't bother you.

25%.  

Gold dipped 66% historically, so 25% of 66% is -16.5% which is pretty close to 1981 when the PP closed out the year at -12.5% or so.  Rising real rates are the PP's #1 enemy.  Real rates don't have to be positive or above 2%, just the upward direction alone is enough for the market to discount such a future.

I don't even look at the portfolio values in Quicken when I load it unless I absolutely have to, but the annoying temptation is like a naked woman.

Budd, you've got to practice the art of selective ignorance and compartmentalization to avoid emotional entanglements and cultivate a sense of serenity.  The PP is hedged all ways from one, but only in the long run.