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Dear
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 Flaws in Vanguard's
Withdrawal Strategy
Vanguard advertises that its mission is to simplify
investors' retirement decisions. In a recently published study,
however, it oversimplified the critical choices investors and their advisors
face in constructing a portfolio for the withdrawal phase of
retirement.
Flaws in Vanguard's Withdrawal Strategy
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Gold and the Decade to Come
Gold is an asset
class unto itself. It is not only a barometer of confidence in governments
and the financial system, but also a reserve asset, an alternative
currency, and a store of value. Those characteristics make gold an
ideal diversifier because it has low correlation to most financial
assets, both in expansionary and recessionary periods. Indeed, the
return pattern to gold investments is not only uncorrelated to most
traditional financial assets, but makes gold uniquely positioned to
outperform when you want diversification the most--during periods of
crisis. This white paper offers a perspective on the role gold
plays in a diversified portfolio as well as our observation of the
supply and demand forces at play that will affect gold investments
over the next decade. We thank American Century Investments for
their sponsorship.
Gold
and the Decade to Come
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A Top Economist's
Nightmare Scenario
Remember the
1970s? Stagflation like we saw then could return to the U.S. if
unsustainable public debt levels trigger a selloff of government
bonds and dollar-denominated holdings, according to a recent study by
John C. Cochrane. Cochrane, a finance professor at the University of
Chicago, is perhaps best known for his response to Paul Krugman's
article in the New York Times on why mainstream economics failed to
anticipate the financial crisis.
A
Top Economist's Nightmare Scenario
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Why Client Events
Aren't Appreciated
Selective,
by-invitation events targeted to top clients pay the biggest
dividends in goodwill and additional business, but it's often hard to
get bigger clients out to 'mass' events, says Dan Richards. The
challenge is breaking through - when it comes to events for top
clients, you need to pick one of two strategies.
Why
Client Events Aren't Appreciated
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The SEC's 12b-1 Proposal is
Based on Misguided History, Flawed Economics
The SEC's stated aims of its proposed Rule 12b-1 reform
are laudable: increasing transparency, reducing investor fees, and
increasing competition among mutual funds. However, John
Robinson's review of its 278-page proposal found major flaws,
including a misinformed historical pretext and naive economic
analysis.
The
SEC's 12b-1 Proposal is Based on Misguided History, Flawed Economics
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Tax Location in
Today's Uncertain Environment
The tumultuous
political climate in Washington has heightened anxiety around the
country, and the uncertainty left when Congress adjourned without
tackling any of the looming tax changes has left taxpayers and
investors wondering just what is in store for 2011. Though the
crystal ball remains cloudy, and while taxes may rise for no one,
everyone, or just the wealthiest Americans, steps taken today can
help tax planners and their clients be better prepared - no matter
what the politicians do.
Tax
Location in Today's Uncertain Environment
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Identify the Human
Factor
One of the most
overlooked steps in goal-setting and goal-achievement is the human
element in the planning process. Once you have clearly defined your
desired outcome, and once you have identified and categorized the
obstacles you have faced or expect to face, you must turn your
attention to the people involved. This is the third of five
articles in the S.H.I.F.T. series
Identify
the Human Factor
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Four New Ways to Beef
Up Your LinkedIn Profile
If you have
logged into LinkedIn in the last couple of weeks, you may have
noticed some new changes. The professional networking site has
new sections for individual profiles, and Kristen Luke explains how
to use them.
Four
New Ways to Beef Up Your LinkedIn Profile
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Letter to the Editor
In a letter to
the Editor, a reader highlights a few generalizations in a recent
article on that, he says, unfortunately cast the entire universe of
529 plans in a uniformly unpleasant light.
Letter
to the Editor
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Highlights from Market
Commentaries
Below are the three most widely read commentaries during
the last week:
 Run
Turkey, Run
The
Fed's announcement of a renewed commitment to quantitative easing has
been well-telegraphed, and the market's reaction is likely to be
subdued. We are in a 'liquidity trap,' where interest rates or
trillions in asset purchases may not stimulate borrowing or lending
because consumer demand is just not there. The Fed's announcement
will likely signify the end of a great 30-year bull market in bonds
and the necessity for bond managers and, yes, equity managers to
adjust to a new environment.
Run Turkey, Run by Bill Gross of
PIMCO
 Night
of the Living Fed
This
is a summary of Grantham Mayo Von Otterloo chairman Jeremy Grantham's
3Q 2010 newsletter. Grantham notes that in the third year of a
presidential cycle, risky, highly volatile stocks have outperformed
low-risk stocks by an average of 18 percent per year since 1964.
Levels of 1400 or 1500 on the S&P 500 one year from now are about
a 50/50 bet. The biggest threats to this possibility are that
Congress will initiate a new trade war, or that the Federal Reserve
will start a currency dispute with quantitative easing.
Night of the Living Fed by
Jeremy Grantham of GMO
Bernanke
Leaps into a Liquidity Trap
The
belief that an increase in the money supply will result in an
increase in GDP relies on the assumption that velocity will not
decline in proportion to the increase in monetary base. Unfortunately
for the proponents of 'quantitative easing,' this assumption fails
spectacularly in the data - both in the U.S. and internationally -
particularly at zero interest rates. Once short-term interest rates
drop to zero, further expansions in base money simply induce a
proportional collapse in velocity.
Bernanke Leaps into a Liquidity Trap by
John P. Hussman of Hussman Funds
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