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Thread: The Stock/Investment Thread

  1. #421
    Senior Member GGT's Avatar
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    Tim, don't be confused by terms like "active management". Even when you buy indexed funds on open trading web sites, you're using some sort of active management (it just might mean a computer algorithm instead of a real person).

    The only 'advice' I can give is.....decide if you're a long term investor or a short term speculator. You can make a ton of money gambling in a hedge fund, or at the casino. Either you want to preserve your capital into the future, or you're willing to lose it all today.

    BTW, it's interesting that there's no Gobal Cannibus ETF, even though medical marijuana is taking on Big Pharma. hmmm

  2. #422
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    Ok, done a big switcheroo.

    Remaining with Fidelity.

    Switched out 100% of my higher risk managed fund into indexed funds; in different regions;
    30% US
    30% Asia Pacific Exc. Japan
    20% UK
    20% Emerging Markets

    Of those 4, the US fund seems to be performing the best when compared to MorningStar.

    No redemption fees or charges for switching out of the fund.

    Am keeping the smaller middle-risk managed fund for now; it does have considerably lower fees than the high-risk fund. Going to see how it performs compared to the index funds.
    Quote Originally Posted by Aimless View Post
    "Scientists raise alarm: bananas can cause EU"

  3. #423
    Good luck! Sounds like a good mix.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  4. #424
    Administrator Dreadnaught's Avatar
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    I agree. I got a bit scared when I saw you're in a fund with negative cash. One of my paranoid bits with mutual funds is they are aggregations of assets, so in theory the fund structure itself can limit liquidity. A fund with debt only has greater exposure to that issue.

    But I think the more important thing to remember is indexes in themselves are merely proxies that have evolved from a much simpler era in stock markets. S&P 500 is just 500 companies when the markets are actually much deeper; for me indexing means I'm either going broad in a particular sector/asset type OR across a whole economy.

    EG, my most-passive mutual fund is the Vanguard Total Stock Market fund. So, my fund mix is chunked-out across international markets, bond markets (short-term, mid-term and high-yield), specific sectors (healthcare, utilities, etc) and total domestic exposure. Actually, the weightings are sort of in reverse order of the sentence before.

    There's inevitably some overlap across these funds, but my goal is to truly broaden exposure beyond the ever-growing (and perhaps over-growing) indexes that mimic the S&P 500.

    Also my condolences for the circumstances that precipitated the inheritance.

  5. #425
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    What are the thoughts of going all cash for a short time right now? My current managed fund (very low expense fees) returns have slowly dropped below S&P 500 returns and I'd like to cash-out the 9.4% return I've gotten this year to give me time to find a nice index fund to put it all in when the time is right. Are there safer options than cash?
    .

  6. #426
    All Worship Ragnarök Loki's Avatar
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    Ideas on where to move money given Trump's upcoming trade wars and general insanity? I currently have everything in US index funds, but that seems to be a terrible idea now. Anything involving China, Mexico, and even Canada would seem to be a risk thanks to Trump. The UK and eurozone have their own set of existential issues. What does that leave?
    Hope is the denial of reality

  7. #427
    Administrator Dreadnaught's Avatar
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    Real estate and corporate bonds?

    I'm pretty short-term pessimistic (because this year hasn't justified the P/E inflation) but medium-term optimistic. Trump is likely better for the economy than Hillary. Or, at least, Hillary was certainly going to continue the era of hyper-regulatory slow-growth. Who the hell knows what Trump will actually do especially on Trade. But it looks like tax reform and regulatory rollbacks are on the agenda which can't hurt.

  8. #428
    All Worship Ragnarök Loki's Avatar
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    I don't really know enough about bonds to make a good decision there. I'm also weary of real estate for a bunch of obvious reasons.

    Yeah, nothing's as good for growth as trade wars. I hear it worked great in the early '30s (under another pro-growth Republican).
    Hope is the denial of reality

  9. #429
    Quote Originally Posted by Loki View Post
    Ideas on where to move money given Trump's upcoming trade wars and general insanity? I currently have everything in US index funds, but that seems to be a terrible idea now. Anything involving China, Mexico, and even Canada would seem to be a risk thanks to Trump. The UK and eurozone have their own set of existential issues. What does that leave?
    I would stick to broad indices and forget trying to second-guess political risk. Trump is even more unpredictable than normal politics and the rest of the world is, as you correctly note, hardly a bastion of stability. I think even trying to favor certain sectors it looks like might do well in the next few years (e.g. defense) is a bit hard to justify given the utter crapshoot that is the outlook under Trump. If you're holding money for the long term, there's no real point in trying to gamble on something so uncertain.

    If it's shorter term money, I'd consider moving into safer asset classes anyways, especially given how long the current economic expansion has been going and the valuations in the stock market. There's not much yield anywhere right now, but I think in the next few years at least a small recession/bear market is highly likely.

    Quote Originally Posted by Dreadnaught View Post
    Real estate and corporate bonds?

    I'm pretty short-term pessimistic (because this year hasn't justified the P/E inflation) but medium-term optimistic. Trump is likely better for the economy than Hillary. Or, at least, Hillary was certainly going to continue the era of hyper-regulatory slow-growth. Who the hell knows what Trump will actually do especially on Trade. But it looks like tax reform and regulatory rollbacks are on the agenda which can't hurt.
    I think it's very hard to know if corporate bonds are a good move - if indeed Trump's corporate tax plans continue apace, it seems likely that blue chip corporate bond issuance will substantially drop, driving down yields.

    I don't have a good enough feel re: real estate to assess whether that's a good idea or not.

    As for the broader effect of a Trump presidency on the economy, I really don't know how growth will look under him. I'm deeply concerned about the deficit and trade, both of which could mean bad things for growth. I'm less certain what will happen on employment and the like, and whether his changed regulatory outlook will have a positive effect on growth in either the medium or long term.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  10. #430
    Senior Member GGT's Avatar
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    I'm pessimistic over the long term, because it reminds me of the bubble and bust cycles we've seen since at least the 70's, without anything but speculation and trends that day-traders and hedge funds make. There's been a Trump bump for sure, but it's not really connected to anything REAL.

  11. #431
    Administrator Dreadnaught's Avatar
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    Quote Originally Posted by wiggin View Post
    I would stick to broad indices and forget trying to second-guess political risk.
    Truth.

    I think it's very hard to know if corporate bonds are a good move - if indeed Trump's corporate tax plans continue apace, it seems likely that blue chip corporate bond issuance will substantially drop, driving down yields.

    I don't have a good enough feel re: real estate to assess whether that's a good idea or not.
    From a long-term perspective I'm okay with that, as I can buy higher yield for lower cost and let it compound. I don't believe in letting capital gains be the only growth-driver in a long-term portfolio.

    From the real estate side, my thinking is higher debt costs and lots of capacity will slow real estate construction, firming-up the cashflow of various REITs for some time. Not an iron-clad theory and not my only approach, but something I'm considering (I also have cash in a Roth IRA that I'd like to put behind something at some point).

  12. #432
    Senior Member GGT's Avatar
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    "Something for nothing, but nothing aint free"....

    I get a kick out of this thread, because I have stocks/investments. But it's also a sad thread, because a large number of people (a growing majority?) do not. They don't have a 401-K plan subsidized by their employer, let alone defined retirement benefits that would be a real "pension". Even working as a "civil servant" (teacher, social worker, fire fighter, police, etc) is on the line, as state budgets are tightening and federal funding is waning.

    I just wanted to say that "privatizing" retirement/pension plans may look good when "the markets" are at all time highs....but it's really just an illusion that mostly benefits Big Banks, investment firms, financial entities, and their political lobbyists. IMO, there really should be a tangible value to putting cash in a savings account that accrues interest over time, promoting saving over speculating.

  13. #433
    Quote Originally Posted by GGT View Post
    I just wanted to say that "privatizing" retirement/pension plans may look good when "the markets" are at all time highs....but it's really just an illusion that mostly benefits Big Banks, investment firms, financial entities, and their political lobbyists. IMO, there really should be a tangible value to putting cash in a savings account that accrues interest over time, promoting saving over speculating.
    There is a kernel of truth here amidst the normal GGishness. Switching from defined benefit to defined contribution plans doesn't really help the typical worker at all; they have to assume all of the market risk and longevity risk, and their costs are higher in general (the economies of scale of large pension funds are hard to beat with a DC plan). I understand why the switch has happened, of course - companies in particular were having trouble funding these large, long term pension commitments with the expected uncertainty in economic/market conditions over 50+ years. To an extent, though, this does benefit the worker - the modern employee hardly stays with a single company for their entire career (DB plans are far less portable than DC plans), DC plans afford you more control over your risk tolerance/etc, and one no longer needs to be tied to the fortunes of a single company. On the whole, I appreciate the increased power and transparency, though I definitely think no one in their right mind would turn down a DB pension plan.

    That being said, most DB plans were unfunded promises while DC plans are cold, hard assets you can invest as you wish. That's a huge advantage IMO, and even if it means workers have to defer some consumption in order to meet their retirement goals, this is just a recognition of the reality that lunches ain't free.

    I think the bit about savings accounts, though, is silly.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  14. #434
    Senior Member GGT's Avatar
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    Why should savings accounts be "silly"....after you've just admitted that DB and DC are practically like playing the lottery?

    Ya know, it used to be that savings accounts paid interest to the account holders, and charged a bit more to people who borrowed from their deposits. But the financial engineers and math quants convinced everyone that monetizing debt could make more profits, and the mortgage industry fell prey to CDOs and MBS. The whole borrowing/credit model shifted, with devastating consequences.

    It's about time that cash savers got a premium on their deposits, instead of being forced into a "lottery" that can wipe out their investment when things go south. The entire credit industry sucks. It sucks even more that you can't get credit without a credit history....

  15. #435
    Quote Originally Posted by GGT View Post
    Why should savings accounts be "silly"....after you've just admitted that DB and DC are practically like playing the lottery?

    Ya know, it used to be that savings accounts paid interest to the account holders, and charged a bit more to people who borrowed from their deposits. But the financial engineers and math quants convinced everyone that monetizing debt could make more profits, and the mortgage industry fell prey to CDOs and MBS. The whole borrowing/credit model shifted, with devastating consequences.

    It's about time that cash savers got a premium on their deposits, instead of being forced into a "lottery" that can wipe out their investment when things go south. The entire credit industry sucks. It sucks even more that you can't get credit without a credit history....
    GGT, the reason that interest rates used to be so high on savings accounts is because inflation was so high (and the federal funds rate was so high) that it warranted it. Both growth and inflation are substantially lower, meaning that the amount of interest banks can profitably pay on a savings account is similarly lower. It's not a conspiracy of 'financial engineers and quants', it's just basic economics.

    No one has ever gotten wealthy from putting money into a savings account - the real returns just aren't high enough to get much from compounding. Savings accounts are one part of a person's financial assets, of course, since they are quite liquid, safe, and return better than cash under a mattress. But no one - ever - has used a savings account to appreciably build their nest egg. In the past, that was done by defined benefit pensions, which used a variety of asset markets (typically a mix of stocks and bonds) to grow company contributions and pay out benefits. Currently, it's mostly done by defined contribution accounts, but the same basic logic holds: capital put to use most effectively will garner the best return.

    DB and DC are not 'playing the lottery' - risk and a crapshoot are not the same thing. Risk adjusted returns from investing in equities are - generally - warranted the greater volatility over long periods.

    As for it being 'about time' people got a premium on their deposits, don't you think banks would pay more in interest if they needed the capital? That's generally what sets interest rates - how easy and cheap it is for banks to raise capital from different sources in order to provide a backstop for their loans. US banks do not actually rely much on wholesale or money-market debt; a huge portion of their capital is tied up in a very deep pool of deposits. That suggests that what is holding interest rates down on deposits is the savings glut, not some nefarious plot to punish savers. If savers put their money to better use (or if our economy had a better underlying growth rate), the cost of deposits would rise and banks would increase the rate they pay out. (Of course, that would also drive up rates for mortgages and other forms of credit as well...)
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  16. #436
    Senior Member GGT's Avatar
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    Banks don't need the capital...because they can make risky monetized bets, and be "bailed out" when they fail, because they're SIFIs. They've sunk their teeth into ordinary people, and will take a pound of flesh for every dollar.

    The mortgage interest rate and credit cart interest rates were high in the 80's -- if you were a new home buyer you felt lucky to get a home mortgage loan under 15%. But you could deduct all sorts of interest payments from your income if you itemized on your tax returns, including any interest paid on credit cards, which was also pretty high. That was stagflation.

    I don't know what it will be called in the Trump era.

  17. #437
    Quote Originally Posted by GGT View Post
    Banks don't need the capital...because they can make risky monetized bets, and be "bailed out" when they fail, because they're SIFIs. They've sunk their teeth into ordinary people, and will take a pound of flesh for every dollar.
    First off, please refrain from using antisemitic imagery in your posts about banks. I doubt you intended so, but it's definitely a bad idea.

    Secondly, banks do need capital - there are regulatory requirements that they hold X amount of capital to cover losses on their loan portfolio. That amount has dramatically increased under Basel III, and SIFIs have even higher capital requirements. This wasn't always the case, but it is now.

    The mortgage interest rate and credit cart interest rates were high in the 80's -- if you were a new home buyer you felt lucky to get a home mortgage loan under 15%. But you could deduct all sorts of interest payments from your income if you itemized on your tax returns, including any interest paid on credit cards, which was also pretty high. That was stagflation.

    I don't know what it will be called in the Trump era.
    It sure seems like you don't like the old mortgage rates but liked the old savings rates. They are two sides of the same coin, GGT.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  18. #438
    Administrator Dreadnaught's Avatar
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    Quote Originally Posted by wiggin View Post
    There is a kernel of truth here amidst the normal GGishness. Switching from defined benefit to defined contribution plans doesn't really help the typical worker at all; they have to assume all of the market risk and longevity risk, and their costs are higher in general (the economies of scale of large pension funds are hard to beat with a DC plan). I understand why the switch has happened, of course - companies in particular were having trouble funding these large, long term pension commitments with the expected uncertainty in economic/market conditions over 50+ years. To an extent, though, this does benefit the worker - the modern employee hardly stays with a single company for their entire career (DB plans are far less portable than DC plans), DC plans afford you more control over your risk tolerance/etc, and one no longer needs to be tied to the fortunes of a single company. On the whole, I appreciate the increased power and transparency, though I definitely think no one in their right mind would turn down a DB pension plan.

    That being said, most DB plans were unfunded promises while DC plans are cold, hard assets you can invest as you wish. That's a huge advantage IMO, and even if it means workers have to defer some consumption in order to meet their retirement goals, this is just a recognition of the reality that lunches ain't free.

    I think the bit about savings accounts, though, is silly.
    I agree defined benefit plans are ultimately a farce. Also because the deferral of the benefit can be taken from you if you lose your job. Granted, most defined benefits are now accorded to government professionals who are un-fireable. Yet still, the idea that you could work a job for decades and then get fired a year before vesting with no retirement savings to show for it is...uncomfortable.

  19. #439
    Senior Member GGT's Avatar
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    Quote Originally Posted by wiggin View Post
    First off, please refrain from using antisemitic imagery in your posts about banks. I doubt you intended so, but it's definitely a bad idea.
    Wait, what? What the hell is "antisemitic imagery" in what I've posted? Seriously, WTF?

    Secondly, banks do need capital - there are regulatory requirements that they hold X amount of capital to cover losses on their loan portfolio. That amount has dramatically increased under Basel III, and SIFIs have even higher capital requirements. This wasn't always the case, but it is now.

    It sure seems like you don't like the old mortgage rates but liked the old savings rates. They are two sides of the same coin, GGT.
    Yeah, I didn't like the old mortgage rates (when they were 12-18%) but I did like the savings rates (when they were above 5%). They aren't two sides of the same coin, any more than "inflation" can be described as good or bad using limited metrics. IMO all economics are relative and contextual. And I'm pretty sure that academic economists haven't kept pace with political economists, and neither have measured consumer economics very well. There's a pretty big divide between theories, measurements, and actualization.

    Even though our GDP is above 2% (consistently higher than most developed nations), our national unemployment rate is under 5% (considered "full employment"), job creation has grown every month for several quarters/years, our federal debt/deficit has been shrinking, our dollar is strong, and "the markets" are at all time highs......there's still the gnawing problem of income inequality, where the majority of growth only benefits the top 10%, and doesn't trickle down to everyone else.

    But don't forget that our housing industry hasn't fully recovered from the CDO/MBS/Credit Default Swap debacle, or that health insurance is still unaffordable for most people without gov't subsidies (aka Obamacare), or that fuel prices are still manipulated by OPEC, or that commodity prices (food) are inflating, or blah blah blah.

    Yeah, I can see how "monetizing debt" has had negative impacts on millions of people. It's part of the globalization and AI/automation era that's left millions of people behind.....and ultimately led to a President Trump "frontier". Yay?

  20. #440
    Senior Member GGT's Avatar
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    Put another way....for those who believe that "capitalism" and "free markets" is the best way to go: how else would you convince people (voters) to do away with Social Security contributions.....if they can't get the same results on their own, by simply making savings deposits, or buying t-bills, that get around the same return (5% or more) than playing the stock market does?

    You can't blame folks for not wanting the rug to be pulled out from under their feet. But that's what "saving" has become--because there's no profit in it. Instead, the only way to "get ahead" is to borrow, get credit, and a credit rating, and pay the bank for the privilege of using your own money on their time. It's a crap game, playing craps.

  21. #441
    Administrator Dreadnaught's Avatar
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    Quote Originally Posted by GGT View Post
    Wait, what? What the hell is "antisemitic imagery" in what I've posted? Seriously, WTF?
    To be honest I missed it too

    Yeah, I didn't like the old mortgage rates (when they were 12-18%) but I did like the savings rates (when they were above 5%). They aren't two sides of the same coin, any more than "inflation" can be described as good or bad using limited metrics.
    They literally are two sides of the same transaction. When prevailing interest rates are 8%, they lend at 8% and attract "safe" capital from savers by offering interest rates slightly below 8%. So the era when you were getting large saving rates was because those savings accounts were being used to lend money at high rates.

  22. #442
    Quote Originally Posted by GGT View Post
    Wait, what? What the hell is "antisemitic imagery" in what I've posted? Seriously, WTF?
    Dude. Does anyone read Shakespeare any more? 'Pound of flesh' is taken from The Merchant of Venice, where the avaricious Jewish banker, preying on the wonderful Christian love-struck Antonio, creates a clause in a loan agreement that upon non-payment of the (usurious) loan, Antonio must give him a literal 'pound of flesh'. He tries to collect on this upon default of the loan, is tried in a kangaroo court, and ends up converting to Christianity. It's one of the most viciously antisemitic portrayals of Jews in English literature, and has provided the basis for many of the resulting stereotypes, especially of Jewish bankers who are unscrupulous and usurious. In fact, Nazis staged productions of Merchant to further this stereotype, centuries after its original writing.

    I understand that 'pound of flesh' has become idiomatic in English nowadays, and in most contexts I would not have remarked upon its use (though I do in general disapprove of such idioms given their etymology). But in a discussion specifically about rapacious banking practices, I am deeply uncomfortable about its usage. I don't think you intended it in this manner, which is why I suggested politely it was not a good idea. Just an FYI for the future.

    Yeah, I didn't like the old mortgage rates (when they were 12-18%) but I did like the savings rates (when they were above 5%). They aren't two sides of the same coin, any more than "inflation" can be described as good or bad using limited metrics. IMO all economics are relative and contextual. And I'm pretty sure that academic economists haven't kept pace with political economists, and neither have measured consumer economics very well. There's a pretty big divide between theories, measurements, and actualization.

    Even though our GDP is above 2% (consistently higher than most developed nations), our national unemployment rate is under 5% (considered "full employment"), job creation has grown every month for several quarters/years, our federal debt/deficit has been shrinking, our dollar is strong, and "the markets" are at all time highs......there's still the gnawing problem of income inequality, where the majority of growth only benefits the top 10%, and doesn't trickle down to everyone else.

    But don't forget that our housing industry hasn't fully recovered from the CDO/MBS/Credit Default Swap debacle, or that health insurance is still unaffordable for most people without gov't subsidies (aka Obamacare), or that fuel prices are still manipulated by OPEC, or that commodity prices (food) are inflating, or blah blah blah.

    Yeah, I can see how "monetizing debt" has had negative impacts on millions of people. It's part of the globalization and AI/automation era that's left millions of people behind.....and ultimately led to a President Trump "frontier". Yay?
    I don't even know how to respond to this. As Dread confirms, they are indeed two sides of the same coin (though with modern banking, the spread between consumer credit/mortgages and savings rates is actually quite a bit smaller), but for the rest, I don't really get what your (wandering) point is. Yes, life is tough nowadays. No, I'm not convinced it is much harder than it was in the past.

    Quote Originally Posted by GGT View Post
    Put another way....for those who believe that "capitalism" and "free markets" is the best way to go: how else would you convince people (voters) to do away with Social Security contributions.....if they can't get the same results on their own, by simply making savings deposits, or buying t-bills, that get around the same return (5% or more) than playing the stock market does?

    You can't blame folks for not wanting the rug to be pulled out from under their feet. But that's what "saving" has become--because there's no profit in it. Instead, the only way to "get ahead" is to borrow, get credit, and a credit rating, and pay the bank for the privilege of using your own money on their time. It's a crap game, playing craps.
    No one has suggested getting rid of Social Security contributions; it's one of the most beloved government programs. And the way to get ahead is to get educated, work hard and earn well, budget carefully, save diligently and invest one's savings. Pretty much how it has always worked.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  23. #443
    Senior Member GGT's Avatar
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    Quote Originally Posted by wiggin View Post
    Dude. Does anyone read Shakespeare any more? 'Pound of flesh' is taken from The Merchant of Venice, where the avaricious Jewish banker, preying on the wonderful Christian love-struck Antonio, creates a clause in a loan agreement that upon non-payment of the (usurious) loan, Antonio must give him a literal 'pound of flesh'. He tries to collect on this upon default of the loan, is tried in a kangaroo court, and ends up converting to Christianity. It's one of the most viciously antisemitic portrayals of Jews in English literature, and has provided the basis for many of the resulting stereotypes, especially of Jewish bankers who are unscrupulous and usurious. In fact, Nazis staged productions of Merchant to further this stereotype, centuries after its original writing.
    Even if people did read Shakespeare and take his plays literally......I doubt they'd come away with your interpretation of "pound of flesh" as antisemitic, but against avarice, greed, or usury in general. I knew Hitler's Germany used literature as propaganda, but didn't know certain stereotypes had such longevity.

    I understand that 'pound of flesh' has become idiomatic in English nowadays, and in most contexts I would not have remarked upon its use (though I do in general disapprove of such idioms given their etymology). But in a discussion specifically about rapacious banking practices, I am deeply uncomfortable about its usage. I don't think you intended it in this manner, which is why I suggested politely it was not a good idea. Just an FYI for the future.
    Thanks for the explanation. When I think about the historical usage of "pound of flesh", the first thing that comes to my mind is black slaves on the auction block. Either way, it's a denouncement of "rapacious bankers" that exploit any group of people for profit.


    I don't even know how to respond to this. As Dread confirms, they are indeed two sides of the same coin (though with modern banking, the spread between consumer credit/mortgages and savings rates is actually quite a bit smaller), but for the rest, I don't really get what your (wandering) point is. Yes, life is tough nowadays. No, I'm not convinced it is much harder than it was in the past.

    No one has suggested getting rid of Social Security contributions; it's one of the most beloved government programs. And the way to get ahead is to get educated, work hard and earn well, budget carefully, save diligently and invest one's savings. Pretty much how it has always worked.
    Republicans have been chomping at the bit to get rid of "entitlement" programs like SS and Medicare since their inception. And they've also been waiting for the opportunity (all branches of government controlled by one party) to de-fund public programs for health and education. It's framed as "unleashing free market capitalism" but it's bullshit propaganda created by special interest groups and their lobbyists.

    I'm just stating the facts. Big banks, financial speculators, and traders/hedgers only care about profits. Their profit model isn't based on any social or civil fairness. In fact, it behooves them to pay lobbyists who influence legislation in their favor.


  24. #444
    Administrator Dreadnaught's Avatar
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    I highly doubt GGT was making a Merchant of Venice reference at even an unconscious level.

  25. #445
    Quote Originally Posted by Dreadnaught View Post
    I highly doubt GGT was making a Merchant of Venice reference at even an unconscious level.
    I doubt it as well. I just think that loaded language like that should be used with care, and that ignorance is hardly an excuse. Just like if I asked someone to get their 'cotton picking hands' off of something, or if I suggested I had been 'gypped' in a recent deal, I would also be guilty of using loaded language in appropriately, even if I hadn't taken the time to think about the etymology of the phrase.

    My comment was informational, not accusatory.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  26. #446
    Senior Member GGT's Avatar
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    Quote Originally Posted by wiggin View Post
    I doubt it as well. I just think that loaded language like that should be used with care, and that ignorance is hardly an excuse. Just like if I asked someone to get their 'cotton picking hands' off of something, or if I suggested I had been 'gypped' in a recent deal, I would also be guilty of using loaded language in appropriately, even if I hadn't taken the time to think about the etymology of the phrase.

    My comment was informational, not accusatory.
    Uh huh, and before we know it you'd be saying "get off your lazy ass" was loaded language, too? I appreciate learning new interpretations of speech, and will never use a pound of flesh in easy conversation, because you've explained why it's demeaning to Jews. FYI, I was taught that calling someone a Jew was derogatory.

    I've also been trying to figure out why using the term "Indian" is respectful and derogatory at the same time. The US mint is introducing new Lady Liberty coins. One of them will use the term "Indian", even though I'm under the impression that "Indian" is considered offensive, and there's at least one campaign to change the name of professional sports teams.
    Last edited by GGT; 01-15-2017 at 09:45 AM.

  27. #447
    Administrator Dreadnaught's Avatar
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    A few weeks ago I bought a Vanguard ETF focusing on intermediate term corporate bonds: https://personal.vanguard.com/us/fun...FundIntExt=INT

    While there's risk of fed rate increases hurting the value, I suspect the impact would be mitigated. And it's a sort of hedge against the stock market rally fizzling. In short, I'm happy with the price moving in either direction; if it becomes more valuable, well that's a win. If it declines, the monthly dividends will be able to buy more bonds at lower prices. I don't have near-term concerns about corporate America having liquidity issues.

  28. #448
    There's also supply to think about. IIRC the supply of decent quality corporate bonds has been decreasing at a pretty fast clip recently, driving up prices in the face of continuing demand. (This was a Bloomberg piece and I can't find it right now, but I think the gist was that there's a lot of maturing debt and not too many places to put the money.) Obviously this is somewhat dependent on the whims of the companies - if they choose to raise a lot of debt to, say, finance a big acquisition (Kraft?) that would have a substantial effect on short term supply issues.

    Anyways, I think it's more than just the fed on this one. Lots of factors involved, but in principle an investment quality corporate bond ETF isn't the worst idea.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  29. #449
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    That's a good point. And helps clarify my views, which is that I actually don't want price appreciation because I'm looking for long-term compound gains from dividend reinvestment. But I might get that short-term price appreciation anyway.

    All this being said, my shyness about the stock market continues to have short-term opportunity costs.

  30. #450
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    My corporate bond funds have been pretty stable, and my junk bond funds have appreciated more than I expected That said, the recent stock rally continues to worry me (albeit I'm capturing a paper gain mostly in my 401K).

    I recently downsized my home because I fetishize https://5kids1condo.com/. Now I have more cash but I am gunshy about investing it. I put a healthy chunk into Lending Club, which is something I think Wraith recommended a while back. The rest I feel like I'm just going to dollar-cost average over the next year, but I'm feeling fuzzy about how to allocate so I'm mostly landing at 50% domestic stocks (small, mid, large), 10% REITs, 10% international and 30% corporate bond funds.

    I'm happy about the home sale, because I wanted to offload a place that doesn't quite serve my needs except during some stretches of time where I can easily squeeze people and build children's character by instilling in them a yuppie communitarianism. Though making investment decisions is also scary. Inshallah there will be tax reform.

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