Interesting article on SWR

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Originally Posted by sengsational I agree that everything will be OK, or better. But I'm on the optimistic side for equities. Not that they'll outdo history, but be on par. I think it's human nature to say everything is used-up, but only because we can't see the cool stuff yet to come. Recall the ideas proposed in the past like, the world only needs a few big computers. And I'm not sure the prosperity of the 50's was agreed upon before the fact. We have some great discoveries now that will turn into huge opportunities, and things that will be discovered that can make life better and make cool things possible. There's no reason to think that this random time in history is the time that humanity will quit innovating.

I don't think a pessimistic financial and political view suggests that one believes that innovating is over. A person would have to be extremely poorly informed to believe that innovation is over. They are two different things. Also, a big factor is where we are now WRT valuations.

Ha

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Originally Posted by Ready Maybe I'm missing something, but since they specifically spell out their assumptions - 8% equities, 5.5% bonds, 20% standard deviation - what numbers are they using to generate the tables if not these numbers? And if they are using these numbers, how are they getting to these failure rates? They are coming up with higher failure rates than Firecalc, which includes the runs during the great depression.

I don't have a clue if they are accurate, or just winging it, since it is not important to me. Firecalc is definitely not the final answer to everything, it uses one historical sequence, in other words what really happened to one economy at one stage of its development and at a certain time of history. These people likely used a Monte Carlo, but again, I don't know and I don't really care. When I posted "it is spelled out", I just meant that they wrote the words that I transcribed. It's a sales document, not a scientific paper.

Maybe they are just liars and are really using a Ouija board?

Ha

[urn2bfree]

Any of the Advisors charging you based on the percentage of your assets that they are managing has a conflict of interest in telling you how big a pot you need. The bigger the pile of money they tell you to accumulate, the more money they get to make. Odd how they always tell you that you need much more than you might calculate if you do it yourself ...