An article by JONATHAN CLEMENTS for all you real smart investors out there.

Good article and IMO a bedrock truth. If one cannot see it operating in himself, it is easy enough to see in the democracy of this board. What ideas are popular and what not, what gets lots of assent and what gets ignored. Only rarely would we be able to really know what approach is correct in any absolute way; but we take sides nevertheless.

Even a simple thing like the propensity to hold equity heavy allocations and to go on rebalancing into a down market is an act of faith. As board member Wab sometimes asks-"Hey folks, what if (this downturn) is Japan 1989 and not USA 1987?

For those still working a protracted bust may or may not work out well. Certainly it would not work out for anyone 50+, or anyone already ERed.

Still, without that faith what is one to do?

I believe that most of us have an implicit faith that extreme volatility and lasting downturns have indeed been banished; by the Boomers, by the Fed, by technology and better inventory control, or by (name your personal candidate).

Ha
 
And in the end, his bottom line is this----

<<<<Faced with this sort of uncertainty and our own ignorance, it makes sense to focus on controlling those things that we truly can control. Hold down investment costs. Diversify to reduce investment risk. Minimize taxes. Save aggressively>>>>

Fine advice, but no new ground broken here. :-\

Put another way
1. Buy those index funds.
2. Do you know the tax impact of your investment choices?
3. Do you own something besides the lastest craze?
4. Are you truly saving enough? (think fire cac)
 
I'm more impressed that he got paid to write with such breathtaking cynicism:
"If you are a regular reader of this column, ask yourself this question: Why do you keep reading my articles?
Sure, I like to think I offer brilliant financial insights served up in peerless prose. But the reality is, I am not Warren Buffett -- and I am not Charles Dickens, either. I peddle a limited array of prosaic ideas. Worse still, I revisit these ideas all too frequently."

By gosh, Jon, you're absolutely right. You really did confirm my bias. If you were so smart then you'd BE retired instead of just agonizing over it like John Mauldin!

Scratch another journalist from my playlist. And those deductions for the WSJ subscription are subject to a 2% threshold, too...
 
Nords - I think you are being a little hard on Clements. I am quite confident he could retire if he wanted to, but likely finds that his voice is helping people in a very complex world as they try to invest and save for retirement, college, etc. He answers hundreds of e-mails each week.
 
New Thinking said:
Nords - I think you are being a little hard on Clements. I am quite confident he could retire if he wanted to, but likely finds that his voice is helping people in a very complex world as they try to invest and save for retirement, college, etc. He answers hundreds of e-mails each week.
Click to expand...
Tell him I said he still has to confront the basic credibility conundrum faced by every financial journalist-- "If you're so smart, why ain't you rich?" Another problem is deadline journalism, which we see a lot of in the financial press.

At least Scott Burns has gone out on his own and freely admits he'll never retire. He doesn't have to come up with something before deadline, either.

Tell Mr. Clements I said he should c'mon in, the water's fine...
 
Nords said:
I'm more impressed that he got paid to write with such breathtaking cynicism:
"If you are a regular reader of this column, ask yourself this question: Why do you keep reading my articles?
Sure, I like to think I offer brilliant financial insights served up in peerless prose. But the reality is, I am not Warren Buffett -- and I am not Charles Dickens, either. I peddle a limited array of prosaic ideas. Worse still, I revisit these ideas all too frequently."

By gosh, Jon, you're absolutely right. You really did confirm my bias. If you were so smart then you'd BE retired instead of just agonizing over it like John Mauldin!

Scratch another journalist from my playlist. And those deductions for the WSJ subscription are subject to a 2% threshold, too...
Click to expand...

One persons breathtaking cynicism is anothers refreshing honest. Both Berstein and Jeremy Speigel talked about the collusion between Wall Street and the financial press. A Money magazine filled with articles talking about the two best index funds to equal the averages wouldn't be big sellers. Scott Burns, Jonathan Clements, Terry Savage not menition this board and the Fool's early retire board pretty much repeat the same mantra over and over and over again, 4%, LYBM, Index funds, asset allocation. There is a heck of lot confirmation bias going on when I read the same stuff and nod my head in agreement.
 
He's a yutz............. :p :p

It would be far smarter to read some of Warren Buffet's old letters to Berkshire shareholders.............. ;)

Confirmation bias? Please!! :LOL: :LOL: :LOL:
 
Here's the email I sent off to Jonathan:

Mr. Clements,

What a great article! Good points, well delivered, and you didn't pull any punches. I agreed with every word you said -- just what I've been thinking, oops :) .

Les
 
LOL, Les let us know if Jonathan writes back.
 
clifp said:
One persons breathtaking cynicism is anothers refreshing honest. Both Berstein and Jeremy Speigel talked about the collusion between Wall Street and the financial press. A Money magazine filled with articles talking about the two best index funds to equal the averages wouldn't be big sellers. Scott Burns, Jonathan Clements, Terry Savage not menition this board and the Fool's early retire board pretty much repeat the same mantra over and over and over again, 4%, LYBM, Index funds, asset allocation. There is a heck of lot confirmation bias going on when I read the same stuff and nod my head in agreement.
Click to expand...

You are correct. And it is an approach that appears to work. If anyone has a better approach please let me know.


On the original topic... people react in a negative way to information that does not confirm their understanding and/or bias related to certain topics. The reason why... it represents a threat. It challenges their preception of how things should work.
 
First off... reporters are not 'smart', they are REPORTERS.... some have an education in the field they report, but not all..

Second, very few reporters make much money... I have talked to our media rep who has lunch etc with the local paper... he had said some had not had a raise in 10 years.... they are 'on the rope' all the time.. so, if you are not doing something on the side, you are not making a lot...

Third, there are many people who have a LOT more money than anybody on this board and will never retire... look at Warren Buffet.. look at that guy who made $400 million on his stock options last year... look at ANY CEO of a Fortune 500 company... some people don't want to retire no matter what...
 
Texas Proud said:
Third, there are many people who have a LOT more money than anybody on this board and will never retire... look at Warren Buffet.. look at that guy who made $400 million on his stock options last year... look at ANY CEO of a Fortune 500 company... some people don't want to retire no matter what...
Click to expand...

except death or catastrophe.
 
Not that retiring can defeat death or catastrophe either.

Ha
 
Texas Proud said:
First off... reporters are not 'smart', they are REPORTERS.... some have an education in the field they report, but not all..

Second, very few reporters make much money... I have talked to our media rep who has lunch etc with the local paper... he had said some had not had a raise in 10 years.... they are 'on the rope' all the time.. so, if you are not doing something on the side, you are not making a lot...

Third, there are many people who have a LOT more money than anybody on this board and will never retire... look at Warren Buffet.. look at that guy who made $400 million on his stock options last year... look at ANY CEO of a Fortune 500 company... some people don't want to retire no matter what...
Click to expand...

Fourth, writers . . . . write! It is what they are called to do in this life, what gives them pleasure. A writer might 'retire' from writing for a particular publication or on a particular topic, but they will still write in some form even if it is just local newspaper opinion pieces. Since writers find particular pleasure in knowing that they are being read and have a chance to influence what other people think and do, I'm wouldn't be surprised to learn that writers like Clements and Burns keep writing even if they didn't need the money.

--Linney (married to a writer)
 
clifp said:
LOL, Les let us know if Jonathan writes back.
Click to expand...

If he doesn't like what you've said, he will write back in a hurry. I disagreed about what clements said on one topic before, so I wrote him.

He wrote back 2 minutes later (at 6:00am no less) ripping into me for not reading his article as it was intended and not doing my research, and how I should have re-read it before wasting his time.

Asshat.
 
Khan said:
I have squandered my existence,
For a pocketful of mumbles, such are promises.
All lies and jest.
Still a man hears what he wants to hear and disregards the rest.
Click to expand...

Are you saying we're fighting The Boxer within ourselves while making our investment decisions...
 
fire5soon said:
Are you saying we're fighting The Boxer within ourselves while making our investment decisions...
Click to expand...
Thank you, that was driving me nuts, I couldn't remember was song that was
from.
TJ
 
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