Cactus
Well-known member
Re: Movin' to Europe...
That's scarey, Boghie. I thought you were all about measuring risk.
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Boghies Account Talk
- Thread starter Boghie
- Start date
Boghie
Well-known member
Re: Movin' to Europe...
Cactus,
I do like risk measurement. I was just at work and knew I wanted to buy a bit more Europe/Japan and lose a bit of the risk of the Treasury slow rolling my access to my 'G Fund' assets. Not that I think that will happen, but the risk of the Treasury locking 'G Fund' assets in place is higher now than at any period I know. Normally, the 'extraordinary measures' are taken at the beginning of the Debt Ceiling argument - not at the end. That kinda means that the process is no longer 'extraordinary', eh...
I knew that a small 15% move split among three asset classes would not dramatically destabilize my overly conservative allocation.
In the end, the prior allocation was:
While my new allocation is:
The 'I Fund' should not be affected by this stupidity. In fact, there might be a flight to safety.
Cactus,
I do like risk measurement. I was just at work and knew I wanted to buy a bit more Europe/Japan and lose a bit of the risk of the Treasury slow rolling my access to my 'G Fund' assets. Not that I think that will happen, but the risk of the Treasury locking 'G Fund' assets in place is higher now than at any period I know. Normally, the 'extraordinary measures' are taken at the beginning of the Debt Ceiling argument - not at the end. That kinda means that the process is no longer 'extraordinary', eh...
I knew that a small 15% move split among three asset classes would not dramatically destabilize my overly conservative allocation.
In the end, the prior allocation was:
- Expected Return: 2%
- Expected Risk: 4%
While my new allocation is:
- Expected Return: 4%
- Expected Risk: 6%
The 'I Fund' should not be affected by this stupidity. In fact, there might be a flight to safety.
Boghie
Well-known member
Sad, very sad - It took so long to build
Re(1): 'The Tom Clancy Thread', The Belmont Club, Richard Fernandez
Always read The Belmont Club...
There is much to remind me of President Carter in President Obama.
Re(1): 'The Tom Clancy Thread', The Belmont Club, Richard Fernandez
Always read The Belmont Club...
There is much to remind me of President Carter in President Obama.
Boghie
Well-known member
Re: Sad, very sad - It took so long to build
Well...
The Federal Gubmint has already spent every dime of our 'G Fund' and Pension assets. The Treasury is clamoring that they will go broke within the month and be unable to pay interest on the debt and Social Security. Taken together, those two expenses will amount to $98 Billion. Revenue for October 2013 should be around $206 Billion - and along with a September surplus of about $120 Billion we should be in fine shape.
But, to be fair, since September is a quarterly tax month let us use $30 Billion of the surplus for October. Thus, we can count on about $236 Billion in spendable cash for October.
After paying off our debt interest and Social Security obligations we have $138 Billion to spend on the rest of government. That should be doable. It's a cut of about $50 Billion off expected spending...
So, what is the problem behind this stream of thought. Here it is in a nutshell. The Treasury 'has' to pay us back for the spending they have already expensed from our retirement fund. If they cannot borrow from the FED (75% of our debt is bought by the FED now) to cover the money they borrowed from our retirement funds than a few things happen. The one I am most concerned about is a freeze on IFTs. Thus, even though it is risky, I am thinking of moving another 10% - 20% out of my 'G Fund' and into C/S/I where they cannot make a grab. They will always allow us back into the 'G Fund', but once in we might be residing in the Roach Motel.
Therefore, tomorrow I think I will IFT to:
Well...
The Federal Gubmint has already spent every dime of our 'G Fund' and Pension assets. The Treasury is clamoring that they will go broke within the month and be unable to pay interest on the debt and Social Security. Taken together, those two expenses will amount to $98 Billion. Revenue for October 2013 should be around $206 Billion - and along with a September surplus of about $120 Billion we should be in fine shape.
But, to be fair, since September is a quarterly tax month let us use $30 Billion of the surplus for October. Thus, we can count on about $236 Billion in spendable cash for October.
After paying off our debt interest and Social Security obligations we have $138 Billion to spend on the rest of government. That should be doable. It's a cut of about $50 Billion off expected spending...
So, what is the problem behind this stream of thought. Here it is in a nutshell. The Treasury 'has' to pay us back for the spending they have already expensed from our retirement fund. If they cannot borrow from the FED (75% of our debt is bought by the FED now) to cover the money they borrowed from our retirement funds than a few things happen. The one I am most concerned about is a freeze on IFTs. Thus, even though it is risky, I am thinking of moving another 10% - 20% out of my 'G Fund' and into C/S/I where they cannot make a grab. They will always allow us back into the 'G Fund', but once in we might be residing in the Roach Motel.
Therefore, tomorrow I think I will IFT to:
G: 30% - Stuff in here could be locked. Not likely, but a risk
F: 0% - lots of gubmint debt, but not likely to be frozen
C: 30% - American Private Sector is growing
S: 15% - American Private Sector is growing
I: 25% - Seem to have less correlation with American Gubmint spending
Expected Annual Return (after inflation): 5%
Expected Risk: 7%
Thus, an expected annual return of between -2% through +12%
F: 0% - lots of gubmint debt, but not likely to be frozen
C: 30% - American Private Sector is growing
S: 15% - American Private Sector is growing
I: 25% - Seem to have less correlation with American Gubmint spending
Expected Annual Return (after inflation): 5%
Expected Risk: 7%
Thus, an expected annual return of between -2% through +12%
Boghie
Well-known member
Re: Sad, very sad - It took so long to build
I know what you mean. Especially when I let politicians define my actions...
The way I'm thinking about it is that I am too young to have 45% of my assets in the 'G Fund' boat anchor anyway. I've missed a lot of growth this year by watching the goobers out east. And, I want to have a 0% chance of those LOPs (Low Output People) locking 45% of my assets in a dead fund. Yowser.
Without this mess I would have probably moved between 5% and 10% out this month.
I know what you mean. Especially when I let politicians define my actions...
The way I'm thinking about it is that I am too young to have 45% of my assets in the 'G Fund' boat anchor anyway. I've missed a lot of growth this year by watching the goobers out east. And, I want to have a 0% chance of those LOPs (Low Output People) locking 45% of my assets in a dead fund. Yowser.
Without this mess I would have probably moved between 5% and 10% out this month.
Boghie
Well-known member
Re: Sad, very sad - It took so long to build
I know what you mean. Especially when I let politicians define my actions...
The way I'm thinking about it is that I am too young to have 45% of my assets in the 'G Fund' boat anchor anyway. I've missed a lot of growth this year by watching the goobers out east. And, I want to have a 0% chance of those LOPs (Low Output People) locking 45% of my assets in a dead fund. Yowser.
Without this mess I would have probably moved between 5% and 10% out this month.
I know what you mean. Especially when I let politicians define my actions...
The way I'm thinking about it is that I am too young to have 45% of my assets in the 'G Fund' boat anchor anyway. I've missed a lot of growth this year by watching the goobers out east. And, I want to have a 0% chance of those LOPs (Low Output People) locking 45% of my assets in a dead fund. Yowser.
Without this mess I would have probably moved between 5% and 10% out this month.
Cactus
Well-known member
Re: Sad, very sad - It took so long to build
I've often wondered about that. Do they even have to freeze it? Can't they just grab the whole pot and just pay us as if we were in the chosen funds. It's all bits in a computer after all. What's to stop them from grabbing it all now and promising to pay it all back with the same worthless IOU's everyone else gets?
maverick06
Member
Re: Sad, very sad - It took so long to build
"worthless IOU's" you mean the green ones with presidents on them???
"worthless IOU's" you mean the green ones with presidents on them???
Cactus
Well-known member
Yes, that does need clarification. Ordinarily this would mean getting paid back with inflated dollars. Here I am referring to our government possibly defaulting on its debt and not paying us at all. Not right away. It's just giving us IOUs like Excepted Employees are getting now.
Boghie
Well-known member
Re: Sad, very sad - It took so long to build
Cactus,
The F/C/S/I assets are not bits in a computer program. They are equity holdings in your specific account. BlackRock is simply a brokerage house (a bank) that holds those records for you. You actually own the stock in the various companies. The Treasury would have to sell those stocks (not borrow against them - ie. securitize) to get money. That ain't even close to legal.
The reason that the 'G Fund' assets can be 'raided' is that they are actually Social Security Bonds. Social Security gives you the bond and you give them money. They then disburse that money out to Social Security recipients. Then they receive Social Security contributions and they pay you with interest. The Treasury can float the payment of those bonds and interest and stuff IOUs in your account. It is wierd how they do it to our retirement funds, but it is somewhat legal. And, as of now they have grabbed it all and there is nothing left.
The odds of these goobers locking 'G Fund' assets it almost 0%, but I want it to be 0% for those assets I want invested.
I've often wondered about that. Do they even have to freeze it? Can't they just grab the whole pot and just pay us as if we were in the chosen funds. It's all bits in a computer after all. What's to stop them from grabbing it all now and promising to pay it all back with the same worthless IOU's everyone else gets?
Cactus,
The F/C/S/I assets are not bits in a computer program. They are equity holdings in your specific account. BlackRock is simply a brokerage house (a bank) that holds those records for you. You actually own the stock in the various companies. The Treasury would have to sell those stocks (not borrow against them - ie. securitize) to get money. That ain't even close to legal.
The reason that the 'G Fund' assets can be 'raided' is that they are actually Social Security Bonds. Social Security gives you the bond and you give them money. They then disburse that money out to Social Security recipients. Then they receive Social Security contributions and they pay you with interest. The Treasury can float the payment of those bonds and interest and stuff IOUs in your account. It is wierd how they do it to our retirement funds, but it is somewhat legal. And, as of now they have grabbed it all and there is nothing left.
The odds of these goobers locking 'G Fund' assets it almost 0%, but I want it to be 0% for those assets I want invested.
MrJohnRoss
Well-known member
Boghie
Well-known member
Re: Sad, very sad - It took so long to build
BT, a good thing...
A very, very good thing...
Those $8 dollar shares have made a huge difference. They are worth over $22 right now. Buying in when folks were really squealing has been a tremendous advantage.
Again, thank you for showing me the value of enhanced GDA during the crying times...
BT, a good thing...
A very, very good thing...
Those $8 dollar shares have made a huge difference. They are worth over $22 right now. Buying in when folks were really squealing has been a tremendous advantage.
Again, thank you for showing me the value of enhanced GDA during the crying times...
Boghie
Well-known member
I missed documenting a move in the AutoTracker - but the market has gone nowhere. I thought I did it, but I was just mind streaming the day before the move. On Oct 15th, I went:
G: 30%
F: 0%
C: 30%
S: 15%
I: 25%
Average Annual Return: 5%
Average Risk: 7%
I would probably be right where I am on the AutoTracker. Anyway, sitting in the high 300s probably takes me out of the running for this year:embarrest:. Thus, I'll be all magnanimous and take myself out of the running...
But, I just made the following move (and AutoTracker is down for maintenance):
G: 25%
F: 0%
C: 32%
S: 17%
I: 26%
It is still:
Average Annual Return: 5%
Average Risk: 7%
While the return/risk is the same in actuallity it is shading heavily toward 6%/8%. Hoping for Christmas...
G: 30%
F: 0%
C: 30%
S: 15%
I: 25%
Average Annual Return: 5%
Average Risk: 7%
I would probably be right where I am on the AutoTracker. Anyway, sitting in the high 300s probably takes me out of the running for this year:embarrest:. Thus, I'll be all magnanimous and take myself out of the running...
But, I just made the following move (and AutoTracker is down for maintenance):
G: 25%
F: 0%
C: 32%
S: 17%
I: 26%
It is still:
Average Annual Return: 5%
Average Risk: 7%
While the return/risk is the same in actuallity it is shading heavily toward 6%/8%. Hoping for Christmas...
Boghie
Well-known member
At home with the awesome power of Quicken at hand, the actual risk/return turned out to be:
Now, as Cactus pointed out in his essay on risk computation, the statistic of 'Risk' is really a variant of variance. Eh... 'Risk' is actually merely a standard deviation measure. Basically, they plot out the annual returns and create a bell curve (which is actually kinda pointy with investment returns) and determine both the norm (the center point) and all the points +33% an -33%. That is, about 67% of the time your return with my current allocation should fall between -3% and +13%. I have found that Quicken presents these numbers as inflation adjusted (using a 3% normal inflation), so a normal return to normal people should be between 0% and 16% with the center point at 8% (no relation to the Average Risk noted above, just a coincidence).
Congrats to those above the average return and even beyond the + side of the normal deviation. You dun well
Average Annual Return: 5%
Average Risk: 8%
Average Risk: 8%
Now, as Cactus pointed out in his essay on risk computation, the statistic of 'Risk' is really a variant of variance. Eh... 'Risk' is actually merely a standard deviation measure. Basically, they plot out the annual returns and create a bell curve (which is actually kinda pointy with investment returns) and determine both the norm (the center point) and all the points +33% an -33%. That is, about 67% of the time your return with my current allocation should fall between -3% and +13%. I have found that Quicken presents these numbers as inflation adjusted (using a 3% normal inflation), so a normal return to normal people should be between 0% and 16% with the center point at 8% (no relation to the Average Risk noted above, just a coincidence).
Congrats to those above the average return and even beyond the + side of the normal deviation. You dun well
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