Re: Another new thread-- Bernstein's asset allocat
Lots of good ideas and great discussion in this thread. Here's some of my simple thoughts.
1) Investing in the US economic engine is still the best investment going. The wind may be taken out of her sails by Japan or India or China for 5 or 10 years at a time, but the US economic/political/social structure has such great advantage that it's still the long term best bet. That's why the US stock market keeps going up in the long run.
2) Diversification (asset allocation) is the best way to get through the rough spots in the long term upward climb.
3) The optimum diversification (asset allocation) has been different for every rough spot in the past and it is likely to be different still for the next one. Asset allocation prescriptions are arrived at through a minipulation of some part of historical data that may or may not be ideal for the future. Although I am often convinced in the short run (right after I've read the reasoning) that some author has a good plan, I always find holes in the logic when I start looking at the prescription more closely. I don't take any of them too seriously. After points 1 and 2, and reading a few prescriptions for asset allocation, you may as well develop your own. When you read all the prescriptions used by all the successful investors on this board, it should be clear that it is points 1 and 2 that matter -- not the details of asset allocation.
The posters of this board may now begin calling me names and spitting on me.
Lots of good ideas and great discussion in this thread. Here's some of my simple thoughts.
1) Investing in the US economic engine is still the best investment going. The wind may be taken out of her sails by Japan or India or China for 5 or 10 years at a time, but the US economic/political/social structure has such great advantage that it's still the long term best bet. That's why the US stock market keeps going up in the long run.
2) Diversification (asset allocation) is the best way to get through the rough spots in the long term upward climb.
3) The optimum diversification (asset allocation) has been different for every rough spot in the past and it is likely to be different still for the next one. Asset allocation prescriptions are arrived at through a minipulation of some part of historical data that may or may not be ideal for the future. Although I am often convinced in the short run (right after I've read the reasoning) that some author has a good plan, I always find holes in the logic when I start looking at the prescription more closely. I don't take any of them too seriously. After points 1 and 2, and reading a few prescriptions for asset allocation, you may as well develop your own. When you read all the prescriptions used by all the successful investors on this board, it should be clear that it is points 1 and 2 that matter -- not the details of asset allocation.
The posters of this board may now begin calling me names and spitting on me.