Dave Ramsey said what??...

[Mr._johngalt]

John,

Since you don't invest in the market, what is your fund invested in? - Pork Bellies?

I never said I didn't invest in "the market". I just own no publically traded
"equities" (stock). That particular fund is their High Yield Corp. Bonds.

JG

 

[shiny]

But I figure, everyone's got to start somewhere, and if Dave Ramsey is the start to someone's financial education, then maybe more of them will wind up where most of you are, knowledge-wise.

That's true, for some folks just getting out of debt is a biggie.

 

[Cut-Throat]

That's true, for some folks just getting out of debt is a biggie.

Yup! - That's where I had to start. The main problem that I have with Dave Ramsey, is you have to join a religion to get out of debt and have financial security.

 

[saluki9]

I never said I didn't invest in "the market". I just own no publically traded
"equities" (stock). That particular fund is their High Yield Corp. Bonds.

JG

Well, if its the High Income Trust, thats a pretty good fund you own.

AF has some really good funds. They also offer load free versions of all their funds for fee based advisors too.

 

[Mr._johngalt]

Well, if its the High Income Trust, thats a pretty good fund you own.

AF has some really good funds. They also offer load free versions of all their funds for fee based advisors too.

Yeah, I don't do nearly the research that a lot of folks do, but that
fund has been ranked near the top of that genre since I bought it.
No prescience. Mostly just luck.

JG

 

[Mr._johngalt]

Yup! - That's where I had to start. The main problem that I have with Dave Ramsey, is you have to join a religion to get out of debt and have financial security.

Yeah, I've noticed that. One of his columns got me so worked up I was
going to write and set him straight. My computer was down and after
I was back in business I said "The hell with it!" I can't decide if he is
overly narrow-minded because of events in his past, or just thinks
"this system is makin' me rich so I better stick with it."

Here is the deal. "Debt" per se is neither good nor evil. In fact,
in many many venues you can make a fortune by just using OPM
and borrowing to the max. Now, you need some brainpower to do this,
but that's how most fortunes are made IMHO (Donald Trump comes to mind).
So, when Dave gets off on one of his "Debt is just terrible, etc" rants.......................well, it's simply not true. Credit (debt) is largely what
drives capitalism/free enterprise. If he has pointed this out, I must have missed that column.

JG

 

[Cut-Throat]

Yeah, I've noticed that. One of his columns got me so worked up I was
going to write and set him straight. My computer was down and after
I was back in business I said "The hell with it!" I can't decide if he is
overly narrow-minded because of events in his past, or just thinks
"this system is makin' me rich so I better stick with it."

Here is the deal. "Debt" per se is neither good nor evil. In fact,
in many many venues you can make a fortune by just using OPM
and borrowing to the max. Now, you need some brainpower to do this,
but that's how most fortunes are made IMHO (Donald Trump comes to mind).
So, when Dave gets off on one of his "Debt is just terrible, etc" rants.......................well, it's simply not true. Credit (debt) is largely what
drives capitalism/free enterprise. If he has pointed this out, I must have missed that column.

JG

I was not talking about Debt! (Which he is also against) - But really Religion - He pushes the Christian dogma so much on his show, that it is almost embarrassing!

 

[Mr._johngalt]

I was not talking about Debt! (Which he is also against) - But really Religion - He pushes the Christian dogma so much on his show, that it is almost embarrassing!

Yes, but his "debt hysteria" bothers me even more. This may be because
I was a big time debtor back in my working days (not now), or maybe
because my SIL is a hard core Christian conservative; thus I am used to
the "Christian dogma" and so it doesn't bother me much.

JG

 

[treypar]

Today I heard him talking about taking out 8% withdrawal based upon a 12% return (past history) in growth & income and balanced mutual funds.

 

[Cut-Throat]

Today I heard him talking about taking out 8% withdrawal based upon a 12% return (past history) in growth & income and balanced mutual funds.

He's getting conservative. He used to talk about a 12% withdrawal with a 12% return. His audience was not sophisticated enough to be bothered by inflation.

 

[treypar]

Most of his audience is so deeply in debt that they are trying to avoid bankruptcy or just survive.

 

[azanon]

You made the assertion. It's your burden of proof.

You claimed that "several" American funds would make a "mockery" of Vanguard funds. Which are they and what time period?

A couple of years ago i looked into American funds because my brother-in-law owns them exclusively... out of curiosity. All i recall from my research was how much better many of them were compared to my American Century and Janus funds. Vanguard is notoriously average since it is common knowledge that the reason most buy Vanguard is to index (aka as buying the average).

I'm too lazy to do that again on account of this thread. Just trust me; they have several great ones, load even included in that.

I dont mean to start yet another index vs active management debate, but I will say I prefer a real person picking my stocks as opposed to a computer. Call it a personal preference.

 

[Cut-Throat]

I dont mean to start yet another index vs active management debate, but I will say I prefer a real person picking my stocks as opposed to a computer. Call it a personal preference.

Even though about 96% of them cannot beat the index!

 

[azanon]

Even though about 96% of them cannot beat the index!

Check your research. Its more like 70%. A figure that would concern me if i were forced to randomly pick my actively managed fund.

10 minutes of reserach for a given fund earns you an extra 1-2% for years. I think its worth the tradeoff. There are proven superstar fund managers out there. You just have to make a little bit of effort to find them.

 

[wildcat]

For all of you American Funds fans -

Sure, nice historical record on several funds. I listened to their CIO speak at a conference and I do respect their style. However, Capital Research has grown to be one of largest asset mgt firms in the country over that time span. A lot easier to outperform with a smaller asset base. Given that it promotes actively managed funds, I wouldn't expect that outperformance to continue due to the severity of asset bloat.

So IMHO:
Asset bloat (esp on those popular funds) + higher expenses than index funds/VG ETFs = underperformance, thus making the American funds not worth the investment. But I could be wrong.

Full disclosure:
After reading Dog's (still up for a wager this weekend?? ) post, I now hope Dave & his envelopes & Ray and his buckets go to hell.

 

[wildcat]

Check your research. Its more like 70%. A figure that would concern me if i were forced to randomly pick my actively managed fund

Depends on the time horizon grasshopper.

 

[azanon]

Don't get me wrong, I admit personal hangups with loads and always filter them out when picking one myself. That being said, I find it quite difficult to fault my brother-in-law's choice to go with them since i know he has been with them for years, and the upfront loads have probably gone to obscurity by now. And that's because the ones he has were pretty much beating mine.

 

[wildcat]

Holy sh!t!!! JG is back. When did that happen??

In his honor I am doing a triple post. Here's to ya JG.

 

[azanon]

Depends on the time horizon grasshopper.

For the time horizon of 2001+, I believe active managed funds are actually beating index. Put any average growth fund against an S&P500 index for 2000+ to see what i mean.

So thanks for pointing that out; i'm overestimating that percertage for some time periods.

None of this changes my general point; i'm not forced to randomly pick my active managed fund. The day that i am, i will gladfully switch to index because it'd be illogical not to, and i'm a logical atheist.

 

[ats5g]

For the time horizon of 2001+, I believe active managed funds are actually beating index. Put any average growth fund against an S&P500 index for 2000+ to see what i mean.

So thanks for pointing that out; i'm overestimating that percertage for some time periods.

None of this changes my general point; i'm not forced to randomly pick my active managed fund. The day that i am, i will gladfully switch to index because it'd be illogical not to, and i'm a logical atheist.

eh, you might want to recheck the figures "since 2001" according to Standard and Poors, from their 3rd quarter 2006 scorecard:

Over longer time horizons, we continue to observe index outperformance. Over the past three years, the S&P 500 has outperformed 68.1% of large-cap funds, the S&P MidCap 400 has outpaced 66.9% of mid-cap funds, and the S&P SmallCap 600 has outperformed 81.1% of small-cap funds. Similarly, over the past five years, the S&P 500 has beaten 70.9% of largecap funds, the S&P MidCap 400 has outperformed 83.6% of mid-cap funds, and the S&P SmallCap 600 has outperformed 80.5% of small-cap funds.

Note the 5 year figures.

Hey, if ya'll want to go with active management, more power to you. However, there are plenty of no-load active funds with just as good records as the American Funds. But, let's face facts, there is simply no way to tell which active funds will continue with their outperformance, and which won't. If there were, I'm sure any broker or newsletter personality that's peddling them would be glad to make up the underperformance of any funds he/she recommends from their personal funds. yeah right...

- Alec

 

[Dawg52]

Full disclosure:
After reading Dog's (still up for a wager this weekend?? ) post, I now hope Dave & his envelopes & Ray and his buckets go to hell.

Cat,
My bullies are pitiful again this year but the cats don't look much better. Lets wager a cold one. Payoff, somewhere down the road.

 

[samclem]

A post by TimDex at the Diehards forum seems germane:
_________________________________________________________
Reading the WSJ this morning---an article on investors chasing the rising market by buying Dow indexes. It included a quote that one doesn't often hear from people with stock brokerages:

"Individual investors tend to have a big leg up on Wall Street firms because they can take a longer time horizon," says Richard Bernstein, chief U.S. investment strategist at Merrill Lynch. "If you use that leg up to invest in indexes for the long term, it can work well."
_________________________________________________________
Taylor opined that Mr Bernstein might soon be out of a job.
It can be dangerous to tell the truth!

 

[CaptCurmudgeon]

Re: Dave & Christian Dogma

One of Dave's oft quoted Bible verses warns about debtors being slaves to their creditors. This dogma lines up with every religion I know of, including atheism. Well, maybe not capitalism. Whoever has been deeply in debt knows that feeling intimately well.

He has helped a whole lot of people where no direction or practical guidance was forthcoming by the education system, a consumer society or that wonderful example of fiduciary responsibility, the U.S. of A govmint.

I do not believe he is trying to throw his faith in the face of his audience, I believe he is just trying connect with some of his listeners.

 

[Nords]

However, there are plenty of no-load active funds with just as good records as the American Funds.

I only want to invest with the no-load active funds that offer rebates for underperforming their benchmarks.

Until then I'll stick with indices & ETFs.

 

[Mr._johngalt]

Holy sh!t!!! JG is back. When did that happen??

In his honor I am doing a triple post. Here's to ya JG.

Back at ya bro.

JG