Finally finished going through the giant Bogleheads thread. Whew! It made for great subway reading. I hope many of the discussions, information, and wonderfully entertaining literary turns of phrase have found their way into the new PP book.
From the recent posts on this forum, though, it seems there just isn't a whole lot else to say about the PP, reflecting its elegant simplicity.
I would just like to comment about one thing. Several posters (including me) have said, repeatedly, that starting the PP feels like you're going against virtually every financial expert opinion, and about to make the worst financial mistake ever. It takes holding your nose and jumping straight into ice cold water. But then, after a few months, you realize how smooth it actually is.
The PP had another effect that's worth a comment though: it pushes you into being a much more disciplined and responsible investor. The 25% cash requirement, which is unique among the "simple" portfolios, would be very hard to maintain without the PP's imposed discipline in these days of near zero interest rates, what with the constant temptations of alternatives that promise a better return.
The best part is that it doesn't feel like discipline at all - it's actually a relief to have a sensible template to follow, and the increased sense of security is as much from that as it is from the smooth, steady returns.
In praise of simplicity
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In praise of simplicity
"Democracy is two wolves and a lamb voting on what to have for lunch." -- Benjamin Franklin
Re: In praise of simplicity
I know...it makes me feel like an investing genius, even though I'm just following HB's recipe.sophie wrote: The PP had another effect that's worth a comment though: it pushes you into being a much more disciplined and responsible investor.
"All men's miseries derive from not being able to sit in a quiet room alone."
Pascal
Pascal
Re: In praise of simplicity
That BH thread is a great resource.
I think that you will find the PP book a bit less spicy, but with great information density.
When it comes to the PP, there is a LOT to cover if you want to provide a good user manual. I think that Craig and I were surprised at how you could write 300-400 pages about the PP and still just be skimming the surface of most PP-related topics.
I think that you will find the PP book a bit less spicy, but with great information density.
When it comes to the PP, there is a LOT to cover if you want to provide a good user manual. I think that Craig and I were surprised at how you could write 300-400 pages about the PP and still just be skimming the surface of most PP-related topics.
Q: “Do you have funny shaped balloons?”
A: “Not unless round is funny.”
A: “Not unless round is funny.”
Re: In praise of simplicity
Do I sense a sequel? 
Re: In praise of simplicity
Links to really good threads would be helpful, though finding the boggle ones and some of the more recent ones here (and of course the FAQ here) is straightforward.
It was good being the party of Robin Hood. Until they morphed into the Sheriff of Nottingham
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WildAboutHarry
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Re: In praise of simplicity
Harry's vision was pretty clear and simple. The "pure" HBPP is T-bills held directly, T-Bonds held directly, physical gold (preferably with some held out of country), and an total market/S&P 500 mutual fund. Today's investing marketplace has made it very difficult to implement that pure vision.MediumTex wrote:When it comes to the PP, there is a LOT to cover if you want to provide a good user manual. I think that Craig and I were surprised at how you could write 300-400 pages about the PP and still just be skimming the surface of most PP-related topics.
I am eagerly awaiting the book.
It is the settled policy of America, that as peace is better than war, war is better than tribute. The United States, while they wish for war with no nation, will buy peace with none" James Madison
Re: In praise of simplicity
I think that one of the things we tried to do was to anticipate many PP objections and address them as well as we could.WildAboutHarry wrote:Harry's vision was pretty clear and simple. The "pure" HBPP is T-bills held directly, T-Bonds held directly, physical gold (preferably with some held out of country), and an total market/S&P 500 mutual fund. Today's investing marketplace has made it very difficult to implement that pure vision.MediumTex wrote:When it comes to the PP, there is a LOT to cover if you want to provide a good user manual. I think that Craig and I were surprised at how you could write 300-400 pages about the PP and still just be skimming the surface of most PP-related topics.
I am eagerly awaiting the book.
The problem with the PP for most people is getting them to actually do it.
Q: “Do you have funny shaped balloons?”
A: “Not unless round is funny.”
A: “Not unless round is funny.”
Re: In praise of simplicity
Another problem many face is that they simply don't have access to the purest assets. Many 401(k)s for instance are pretty bad. Many bond funds are named one thing but do other things behind the scenes, etc. So part of the book also is to help people understand how to avoid these issues if possible, but also work within what they have even if not perfect.
But yes, simplicity rules. I have no doubt in my mind that simpler portfolios will beat complicated ones over time. There are less moving parts to break and assets can be chosen to be held as directly as possible to avoid manager risks.
But yes, simplicity rules. I have no doubt in my mind that simpler portfolios will beat complicated ones over time. There are less moving parts to break and assets can be chosen to be held as directly as possible to avoid manager risks.
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jackely