Gyroscopic Investing

moda0306 wrote:I think you'll find it 100x more interesting here for the intellectual diversity on display.

Yes, this is a wonderful forum for its intellectual diversity. It's amazing what happens when you get a portfolio that is so well balanced... Inflationistas, Deflationistas, Conservatives, Liberals and Libertarians can suddenly talk and bounce ideas off of each other without being so biased by their own portfolios. Try having the same conversation with someone who's so heavily invested in one particular asset and you'll see what I mean.

Gumby,

I think this might be a chicken/egg dilemma.

I tend to believe that we're more predisposed to the PP based on our intellectual curiosity, not the other way around, but there's probably some of both.

Whatever the reason, this board is pretty great, IMO... there's just a natural filtering process to stupidity that doesn't exist elsewhere, and it appears to be self-sustaining at this point.

moda0306 wrote: Gumby,

I think this might be a chicken/egg dilemma.

I tend to believe that we're more predisposed to the PP based on our intellectual curiosity, not the other way around, but there's probably some of both.

Whatever the reason, this board is pretty great, IMO... there's just a natural filtering process to stupidity that doesn't exist elsewhere, and it appears to be self-sustaining at this point.

Yes, good point. Although, from my experience, the PP has allowed me to see the world differently (Macro views on LTTs, Gold, etc).

Doug, I hear you. Sometimes it seems that the PP stands for "Progressive's Portfolio", despite all that HB said.

Reub,

This will probably taint this thread a bit, but you seem to be one of the few here who doesn't like the fact that people think differently than you on this board, as evidenced by several glib responses in the middle of more thoughtful conversations.

If you find it unsettling and bothersome that there is a broad spectrum of political thought here, I'm sure there are places better suited to your political attitude, and you can simply stick to discussing investing and other topics that you can actually add some value to.

What we have is about 1,000x better than a libertarian echo-chamber (or a liberal one at that), but frankly you don't add to the political discussions here.  Your repeated attempts to poison the rhetoric here wouldn't be appreciated by HB.  Maybe just stick to the investing posts and leave the political ones for people trying to actually have an intelligent conversation, not just throw out insults.

Everyone is at different stages of understanding of all things political and economic, and these levels of understanding are normally always in the process of evolving.

Today's statist might be tomorrow's libertarian.

Even if someone's current beliefs don't match up exactly with HB's, at some point in the future they might.

There is no point in stopping the discussion because someone strikes a note that is out of synch with HB's thinking.

MediumTex wrote: Everyone is at different stages of understanding of all things political and economic, and these levels of understanding are normally always in the process of evolving.

Very true.  In high school I was rather liberal.  College abruptly changed my views and I became much more conservative.  I was convinced most federal spending was either too wasteful or wrongheaded with certain exemptions like the military or environmental protection.  Then I joined the military and after twenty years I adjusted my previous views on environmentalism and the military, and have become much more libertarian. 

I'm not saying my current views now constitute "The Truth", they're only correct from my point of view.  However, the opinion of anyone who hasn't changed their viewpoints several times over their life is suspect.  After all, fanatics never change their opinions but reasonable people when confronted with a different set of facts do change their opinion. 

I think I'm open to new ideas.  I did adopt the PP after 20 years of Bogleheadism. 

I'd be really worried if the portfolio only appealed to people with certain political views.  The fact that it draws support from across the spectrum gives me more confidence in the underlying principles.

Wow. I'm very impressed with the level of thought and dialog being presented in this forum...I've heard it said that what we need to consider is not just the type of government or economic structure we labor under but rather the integrity of the people who are making important decisions.

dragoncar wrote: I'd be really worried if the portfolio only appealed to people with certain political views.

Amen.

When you are asked to invest in gold AND long-term treasuries, it really weeds out the riff-raff that have an unrelenting political agenda and little else.

Reub, you are clearly passionate about your politics and clearly make the point that you consider much of what is said on here to be very misguided. But your answers are so consise (a couple of words) that they only communicate that and do not explain WHY other views are wrong. Personally I do think your posts are worthwhile because they flag up the fact that what others (often me) are saying is not generally agreed on. But I think they could be so much more with a bit of explanation thrown in. Please keep posting.

I come here for the PP, not for political commentary. Please excuse me if my political responses are somewhat terse. It is because I am annoyed at having to read politics in a PP forum. Maybe the Bogleheads are onto something by banning politics in their forums. I will just try to stay out of the political discussions in the future.

Reub wrote: I come here for the PP, not for political commentary. Please excuse me if my political responses are somewhat terse. It is because I am annoyed at having to read politics in a PP forum. Maybe the Bogleheads are onto something by banning politics in their forums. I will just try to stay out of the political discussions in the future.

Like it or not, politics has a huge impact on our variable portfolios, now more than ever.  I don't mind discussions of economics or how politics impacts out investments as long as it's constructive and a variety of opinions are included.  Of course , partisan bickering over non-economic policy (abortion, social security, Iraq, etc) is probably best left to the Rachel maddow's and Sean Hannity's of the world. 

The Bogleheads forum goes way overboard in censuring any poitical discussion whatsoever.  Geez, Taylor Larimore locked one of my threads because I had the temerity to opine that TIPS wouldn't protect anyone's portfolio from hyperinflation.  His private email to me was that my thread was locked for being "too political." ?!?!?!  It would be sad if this forum became that Hitleristic. 

FarmerD wrote:
Like it or not, politics has a huge impact on our variable portfolios, now more than ever.  I don't mind discussions of economics or how politics impacts out investments as long as it's constructive and a variety of opinions are included.  Of course , partisan bickering over non-economic policy (abortion, social security, Iraq, etc) is probably best left to the Rachel maddow's and Sean Hannity's of the world. 

The Bogleheads forum goes way overboard in censuring any poitical discussion whatsoever.  Geez, Taylor Larimore locked one of my threads because I had the temerity to opine that TIPS wouldn't protect anyone's portfolio from hyperinflation.  His private email to me was that my thread was locked for being "too political." ?!?!?!  It would be sad if this forum became that Hitleristic. 

i agree  "some politics" rationally discussed. improves the site and it is a part of economics and investment, the bogleheads are way overboard in there moderation and i was turned off by it and not interested in posting there because of it, i think if we try to avoid inflammatory statements and personal attacks and give each other gentle reminders when we forget, the political discussions are fine, 

also i would say some self congratulation is in order, the posters here do a great job of keeping potentially flame war worthy topics civil and informative.. 

Reub, I take your point that it is perhaps polite to limit politics to threads in the "other" section of the site. I have strayed on threads such as the thread about a gold standard on the "gold" part of the thread. Maybe that "gold standard" thread should have been in the "other" section and not in the "gold" section? I do find it hard to disentangle politics from everything else. Trying to understand why any of the PP assets do what they do means trying to understand economics and there isn't really ever a dividing line between economics and politics.

Here's an interesting question about the American Jobs Act that ZeroHedge posed today:

On a side note, any chance the jobs bill is causing layoffs to increase?  If cash for clunkers can change the timing of car purchases, why can't layoffs be tied to this bill?  Lay someone off and if the jobs bill gets passed, you can hire them back and get some government kickers to subisidize the "new hire".

Gumby wrote: Here's an interesting question about the American Jobs Act that ZeroHedge posed today:

On a side note, any chance the jobs bill is causing layoffs to increase?  If cash for clunkers can change the timing of car purchases, why can't layoffs be tied to this bill?  Lay someone off and if the jobs bill gets passed, you can hire them back and get some government kickers to subisidize the "new hire".

I think that line of thinking presupposes that the jobs act will actually pass.

Does anyone think that the current Republican House would EVER pass a $450 billion spending bill right now for ANYTHING?

MT,

Most of it is a payroll tax cut... and let's not forget an even nicer SE tax cut (6.2% tax reduction from dollar one of net income).

That said, the rhetoric on the right today seems to be that permanent tax reform is what's needed to get the economy moving, not short-term tax cuts.

I like the idea of tax reform, but I really don't think there's much reason to expect it will send our economy rocketing again.  It will eliminate some of the crony-capitalism, but I just don't see the "jobs math" working out.

I have to imagine some compromise will come of this, because SE/payroll taxes are a pretty big burden on the middle class and small business, and repubs balking at it will not be taken to kindly by those that would otherwise see $1,000-$2,000 more in income in 2012 as a result of this bill.

Further, a couple making $100k each in wage income will get back $6,200.

It's not like this is a welfare-moms credit... it should be popular with a vast majority of the population.

moda0306 wrote: Further, a couple making $100k each in wage income will get back $6,200.

It's not like this is a welfare-moms credit... it should be popular with a vast majority of the population.

I don't disagree, and I am enjoying my 2011 payroll tax cut very much.

But, isn't there something a little weird about taking two entitlement programs that are in incredibly poor condition financially (i.e., Medicare and Social Security) and reducing their funding streams even more in the form of a payroll tax cut?

Over the longer term, isn't this sort of approach just going to make fixing the funding for these programs even more difficult?

I think that among people who understand the problems facing these two programs, it is obvious that the only solution to their long term solvency is to raise the payroll tax, cut benefits, and push back the date of eligibility for benefits under these programs.  If that is the only path forward, enacting these one-year-at-a-time payroll tax cuts seems like a sort of dumb exercise.

Again, though, I am enjoying the tax cut, whether it makes any sense or not.

These cuts are to the payroll tax, but the programs receive funding from the general fund to make up for the shortfall.

moda0306 wrote: These cuts are to the payroll tax, but the programs receive funding from the general fund to make up for the shortfall.

So if the payroll tax is no longer covering the cost of the programs, doesn't that mean that we have basically arrived at zero hour for these programs--i.e., from here forward they are going to be a drag on the overall federal budget just like they have been a boon as a result of their surpluses since the last payroll tax reform in the early 1980s?

I guess you could say that until we re-raise the payroll tax cut, SS (the part that was cut) is now dipping into the general fund, but I think if we had them all we'd still be net-paying into SS... either way, at full 6.2% FICA I think it's very close.

So I think that the SS trust fund over the next 40 years or so will be cashing in on all the treasury bonds it purchased.