PP investors--stay the course

[MediumTex]

The enemy is within.

[frugal]

Dude, sometimes you slay me. 

Just messing around fellas. These ups and downs don't really phase me as much as they used to. 

[WhiteDesert]

They laughed when I said I was going to be a stand-up comic.
They're not laughing now.

Hehe. Nice.

He'll be here all week, folks. Please tip your wait staff.

[Kriegsspiel]

Dude, sometimes you slay me. 

Just messing around fellas. These ups and downs don't really phase me as much as they used to. 

Want.

[dragoncar]

Ooh, are we doing ambiguous posts again?

Here's one:
===============================

I "hate" the PP.  And buddtholoMEW. 

P.S. Just "kidding". 

Tell me you didn't expect a negative post from me after today's decline? I tried not to disappoint, but have learned not to "freak out" when the PP declines.

Came here for your post.  Was not disappoint.

[dragoncar]

It's like every time I have a paycheck coming up, the PP goes "nope! No nw increase for you!"

[Pointedstick]

It's like every time I have a paycheck coming up, the PP goes "nope! No nw increase for you!"

Hey, that means you can buy at depressed prices! 

[frugal]

Go PP go PP go go go!

[dragoncar]

Go PP go PP go go go!

Go PP go PP ... Oh no!

[frugal]

[frugal]

Come on PP 


Grow!!!






I am waitinnnnnnnnnnnnnnnnnnnggggggg 

[frugal]

C'monnnnnnnnnn PP!

So many bad months 

[Rien]

C'monnnnnnnnnn PP!

So many bad months 

HB calls it "Tight Money", and he states that there is no possible way to profit from such a phase. It is the only phase where the PP does poorly. However, other investing methods are likely to do even more poorly.
As Richard Russels states it: He who looses least, wins. Though that hardly makes anybody feel better...

[frugal]

C'monnnnnnnnnn PP!

So many bad months 

HB calls it "Tight Money", and he states that there is no possible way to profit from such a phase. It is the only phase where the PP does poorly. However, other investing methods are likely to do even more poorly.
As Richard Russels states it: He who looses least, wins. Though that hardly makes anybody feel better...

the biggest fear happened

start a system before a DRAWDOWN

How do you have force to proceed?



Regards!

[Rien]

C'monnnnnnnnnn PP!

So many bad months 

HB calls it "Tight Money", and he states that there is no possible way to profit from such a phase. It is the only phase where the PP does poorly. However, other investing methods are likely to do even more poorly.
As Richard Russels states it: He who looses least, wins. Though that hardly makes anybody feel better...

the biggest fear happened

start a system before a DRAWDOWN

How do you have force to proceed?

Regards!

The power of conviction? 

HB also stresses the point that the PP is designed to keep your savings safe in the best possible way, not to make money from your them. This is in clear opposition to just about all other investment philosophies. It is something I want to be aware of and keep in mind at all times.

[frommi]

HB calls it "Tight Money", and he states that there is no possible way to profit from such a phase. It is the only phase where the PP does poorly. However, other investing methods are likely to do even more poorly.
As Richard Russels states it: He who looses least, wins. Though that hardly makes anybody feel better...

How can we be in a phase of tight money, when QE is active?
Tight money makes only sense when there is a phase of high inflation und the central banks want to reduce that. But thats not the case currently. Look at Ray Dalio`s video, than you can clearly see that we are in a reflation and that is a phase where the PP was never before because nobody has data from 1930-1970.

[Rien]

HB calls it "Tight Money", and he states that there is no possible way to profit from such a phase. It is the only phase where the PP does poorly. However, other investing methods are likely to do even more poorly.
As Richard Russels states it: He who looses least, wins. Though that hardly makes anybody feel better...

How can we be in a phase of tight money, when QE is active?
Tight money makes only sense when there is a phase of high inflation und the central banks want to reduce that. But thats not the case currently. Look at Ray Dalio`s video, than you can clearly see that we are in a reflation and that is a phase where the PP was never before because nobody has data from 1930-1970.

I assume you mean the video "how the economy works"? I have seen that.
Just because the Fed replaces dubious assets with money does not mean that there is reflation going on. The Fed is trying to avoid a system collapse which is imo quite different from a reflation.
In the video RD shows that when the Fed has the interest handle at zero they only have the printing press left. But the society does not want this money since it represents debt of which there is already too much. The only one that could start a reflation in these conditions is the government. And they do not seem to be intent on this.

[frugal]

HB calls it "Tight Money", and he states that there is no possible way to profit from such a phase. It is the only phase where the PP does poorly. However, other investing methods are likely to do even more poorly.
As Richard Russels states it: He who looses least, wins. Though that hardly makes anybody feel better...

How can we be in a phase of tight money, when QE is active?
Tight money makes only sense when there is a phase of high inflation und the central banks want to reduce that. But thats not the case currently. Look at Ray Dalio`s video, than you can clearly see that we are in a reflation and that is a phase where the PP was never before because nobody has data from 1930-1970.

frommi

what do you think will happen and what will be PP behaviour?

Regards

[frommi]

I assume you mean the video "how the economy works"? I have seen that.
Just because the Fed replaces dubious assets with money does not mean that there is reflation going on. The Fedx is trying to avoid a system collapse which is imo quite different from a reflation.
In the video RD shows that when the Fed has the interest handle at zero they only have the printing press left. But the society does not want this money since it represents debt of which there is already too much. The only one that could start a reflation in these conditions is the government. And they do not seem to be intent on this.

I meant that video, but reading your comment i think you looked another one.
Why do you think RD made that video, if he doesn`t think we are in a reflation? To me he clearly has done it because he thinks we are in one and to elaborate why printing money is not bad if kept in balance with debt reduction. Thats the whole point of the vid or am i wrong?

@frugal i don`t know . But interest rates going up in the long run would only be natural in these kind of cycles.

[Rien]

I meant that video, but reading your comment i think you looked another one.
Why do you think RD made that video, if he doesn`t think we are in a reflation? To me he clearly has done it because he thinks we are in one and to elaborate why printing money is not bad if kept in balance with debt reduction. Thats the whole point of the vid or am i wrong?

I think the video fails after the short term debt cycle. The longer term debt cycle depends on much more than just the money and debt creation. For example technology, energy and world politics play a large role that can override the cycle at any time.

[buddtholomew]

This portfolio is a gem...down when the equity markets are up and when the equity markets are down. Definitely consistent.

[Libertarian666]

This portfolio is a gem...down when the equity markets are up and when the equity markets are down. Definitely consistent.

I think you should go with something better, like 200% long in emerging markets. The returns are enormous... and often even positive!

[Pointedstick]

This portfolio is a gem...down when the equity markets are up and when the equity markets are down. Definitely consistent.

I think you should go with something better, like 200% long in emerging markets. The returns are enormous... and often even positive!

Perhaps a 100% gold portfolio? Gold was up today.


Or maybe 100% stocks, since the equity markets seem to be your benchmark. Why not just own the benchmark? Then you'll never have to worry about underperforming it!

[Libertarian666]

This portfolio is a gem...down when the equity markets are up and when the equity markets are down. Definitely consistent.

I think you should go with something better, like 200% long in emerging markets. The returns are enormous... and often even positive!

Perhaps a 100% gold portfolio? Gold was up today.


Or maybe 100% stocks, since the equity markets seem to be your benchmark. Why not just own the benchmark? Then you'll never have to worry about underperforming it!

You are joking, but I'm pretty sure that 100% gold has vastly outperformed the stock market over the past 15 years, and without as big a drawdown.

Edit: Here are the results from the backtesting tool at http://www.portfoliovisualizer.com/ for 1998-2012. Guess which is which?

# Initial Balance Final Balance CAGR StdDev Best Year Worst Year Sharpe Ratio Sortino Ratio US Mkt Correlation Intl Mkt Correlation

1 $10,000 $53,784 11.87% 12.06% 30.57% -5.82% 0.83 2.06 0.20 0.33
2 $10,000 $20,411 4.87% 19.44% 31.35% -37.04% 0.22 0.13 1.00 0.94

[Pointedstick]

You are joking, but I'm pretty sure that 100% gold has vastly outperformed the stock market over the past 15 years, and without as big a drawdown.

It sure has. And 100% stocks obliterated gold during the 80s and 90s. 100% bonds has also yielded fantastic capital gains and interest payments for the past 30 years. If only there was some portfolio that combined all three of them…