John T. Reed’s news blog
How to ‘beat’ inflation
Posted by John Reed on
Today's WSJ has an article titled "Finding New Ways To Beat Inflation." I'll save you the trouble of reading it. It says to scrimp. . I wrote a whole book on that subject without ever advising readers to simply cut back on consumption. The average Venezuelan has lost 24 pounds due to hyperinflation there. That is the precise definition of scrimping. People die from scrimping. . My advice roughly speaking is to convert USD into non-USD assets like real estate, coins, foreign currency, long-shelf food, milder climate location to minimize heating and air-conditioning inflation, borrow mortgages. The last one enables...
Get rid of your bonds
Posted by John Reed on
I am reading the book In Pursuit of the Perfect Portfolio. I continue to be amazed at supposedly smart guys investing in bonds and recommending bonds. I am now reading the late Jack Bogle (Vanguard) chapter. Even he owned bonds. . He even recommends that old chestnut that the percentage of your savings that is in bonds should equal your age. No. That percentage should always be zero no matter your age. . When there is inflation, you must look at the real (adjusted for inflation) yield. When the nominal (the interest rate written on the bond) bond yield is...
Late interceptor in National Championship should have slid, not scored.
Posted by John Reed on
Football games do NOT only end on the game clock buzzer or the final whistle. . Games also end when the LEADING team has POSSESSION and ENTERS THE TAKE-A-KNEE PERIOD. (When the trailing team is in possession, the game ends on the final whistle.) . My book Football Clock Management book has take-a-knee and QB-sweep-slide tables that tell you when you are in the take-a-knee or sweep-slide period. Sweep slide is a take-a-knee play but one that takes more seconds than the quick take-a-knee. There are high school, college, and NFL tables because of different clock-operation rules at each levels....
What should be in the “perfect portfolio?”
Posted by John Reed on
Today’s WSJ has a review of a new book In Pursuit of the Perfect Portfolio—a survey of all the major academic experts on such things—although I was surprised to not see Burton Malkiel mentioned. . But the review and the book piss me off as I have been pissed off before for assuming that “portfolio” refers only to stuff you can buy from a securities broker. Actually, if the review was comprehensive regarding the nature of the book’s contents, it is not even that broad. It is only about broadly-traded common stocks, no mention of bonds. . This is outrageous....
Never agree to a balloon payment.
Posted by John Reed on
I recently did a zoom with the Chicago CCIA—Chicago Creative Investors Association. It is individual real estate investors. Among other things I told them no balloon payments. 30-year fixed-rate self-amortizing mortgages only. One guy asked what if you cannot find any such mortgages because all the lenders refuse to make 30-year self-amortizing mortgages on apartment buildings? So don’t buy apartment buildings. Balloon payments being all but universal in apartment buildings these days is one of the main reasons for my recent book An American Principal Residence is the Most Advantaged Investment on Earth: Maximize Yours! Chapter two is all the...