William J. Bernstein's Post 2009 Thoughts

[pb4uski]

This drop was far, far faster than the other periods which took many months if not years to reach the down 30% from peak, so I get the running scared part.

Many ER folks here retired after 2008 as that is already 12 years ago!

Yes, this drop was much faster... and that is what has rattled people, along with the uncertainty as to what will happen.

Here is the S&P 500 since it peaked back on February 19 of this year. This is through Thursday’s close. It is down about 29% in 4 weeks.

Now, here is the S&P 500 from back in the Global Financial Crisis. This was the last time the world’s economy was in total panic mode. The headline reasons were different. There was not a global health crisis. It was the reckoning of years of leverage in the financial system, and the bubble popped. This is just about the same point in the down-cycle for stocks. It just took a month this time, versus about a year last time.

https://www.forbes.com/sites/robisb...vs-2020-a-warning-to-the-greedy/#68eabe794b62

 

[Running_Man]

In addition, Bill Bernstein's constructed portfolio's over the last 10 years since 2009 have under performed by quite a bit, earning no quite 6 percent per annum despite the heavy stock allocation in the biggest bull market in history.)
Both his No-Brainer portfolio (still the base 75% stocks he basically believes is best investment for the average investor) and the Coward's portfolio (60% stocks not 75 hence the name Cowards) are both behind a basic 40/60 Blend portfolio with VTI/BND and almost 2.2 percent per annum behind a 60/40 blend.

And for this under performance you can have Billy run your portfolio too for only a 0.35% fee over the fees of funds you get entered into and a 7 million dollar portfolio on average (that's 25K per year per portfolio for Billy to balance for you and have an annual portfolio review - preferred long term comparison is for portfolio's to start with 2004 but in most cases each portfolio has an index that directly matches the portfolio for comparison with small variances and from 2004 they tend to just ever so slightly over perform--- though most are 2.2% below the basic 60/40 VTI/BND.

Lazy Portfolios and ETF composition

 

[Elbata]

Bernstein: "As in the depths of the Great Depression, there are now generous returns to be had for the brave, the disciplined, the liquid. If there was ever a time to own a prudent portfolio that includes equities for the long term, it is now."

The market falls like this rarely. Over the long term, I'm betting on America.