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Old 08-08-2014, 10:31 AM   #1
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Hello!

Hi I am a 33 yr old. early retirement has been my long time dream for me. I grew up poor and therefore am used to saving money and/or forcibly trained on delayed gratification. Given that back ground, I now have the will power to save and work hard to get what i want. My goal is to early retire so that I can focus my efforts on building AI. I have read Jeff Hawkins (On Intelligence, On Intelligence: Jeff Hawkins, Sandra Blakeslee: 9780805078534: Amazon.com: Books) book and have been quite inspired to make this invention happen. For those that don't know, Jeff Hawkins basically invented the smartphone. Was 10-15y ahead of Steve Jobs. So he's the real deal.

What do I bring to you all?
I work in the bond market, so feel free to ask me related questions. I think bonds will outperform equities, adjusted for volatility. All you have to do is compare two times 10y bond yields (do 2x to adjust for lower bond volatility) to the inverse of the shiller PE and figure out whats a better yield (right now stocks are). Please read about Shiller PE and expected stock returns. Pretty heavy correlation (see link below). Basically, if you pay more for something, returns are gonna be lower. The number one factor in any stock picking is the price you pay...I am not sure why people don't get that anyways..

73-Year Chart Comparing Estimated Shiller PE Returns to Actual Returns | Greenbackd

and AQR (one of the most successful hedgefunds) Shiller PE paper (particularly the table on page 3). Basically the point is that future stock returns are very correlated to Shiller PE.

https://www.aqr.com/Portals/1/Resear...liffAsness.pdf

Shiller PE it self can be found here: Shiller PE Ratio
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Old 08-09-2014, 05:26 AM   #2
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Welcome from another n00b.
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Old 08-09-2014, 08:14 AM   #3
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Welcome to you both. I look forward to hearing more from you.
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Old 08-09-2014, 08:15 AM   #4
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Welcome to the community! I think you will find the knowledge on this forum to be very informative. With that being said, a majority of the the members (IMHO) are index fund, rebalance "rinse and repeat" type investors (myself included) and not individual stock, market timers.

There is actually a thread going on now regarding Shiller PE that you might be interested in.

Using Shiller PE to Time the Market


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Old 08-09-2014, 09:13 AM   #5
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