Two things this morning.First up is the Boomer Angst special on The Network the other night. I have to say that I was expecting a lot more people don't plan to fail they fail to plan tag lines so kudos for that.
My brother and I spent some time chatting about the show yesterday. I noticed no mention of living below your means and Larry felt that not enough attention was paid to real estate but the one comment (he missed it and I filled him in on it) was flat out wrong.
We both agreed that "get out of debt" could have used a little more meat on the bone as far as how to do that.
One related topic that I don't think came up but whether it did or not is something I have been thinking more about which is the unexpected. Last week we had to get two new tires for our pickup truck and it cost $400. It was just one of those things that comes up but go look at your check book (or more likely Quicken), how many just one of those things have come up in the last year?
Plumbing issues beyond your experience level, new tires for your car or dogs who eat rocks (this has never happened to us) don't know you are retired and living on a fixed income. This sort of thing could be very problematic for executing a well devised retirement plan.
The other topic is along the lines of alternative assets from an article in Barron's about investing in things like art, wine and fiddles (well, rare violins). The article mentioned the MEI Moses Art Index which I think I had heard of but don't really know anything about.
In looking for the MEI Moses site I found a couple of older articles about art funds, that appeared to actually buy and sell pieces of art, that implied the funds struggled.This chart is from the MEI Moses site (I do not know why it only goes to 2006) and you can see several instances of meaningful divergence from equities.
I had a tough time finding return numbers for the art index, there is some info here but it was not crystal clear to me the exact time covered but as of some date in 2007 the art index outperformed the S&P 500 total return for one, five and ten years.
I have no idea what anyone should expect in the future but the return seems like it has been steady so an ETN indexed to MEI Moses (I do not know how a provider would hedge such a thing) could have a place in a portfolio once it was properly studied.
From a slightly bigger picture this ties into finding close to equity returns from things that are not equities for some portion of your portfolio. If you could get a steadier 6% or 7% from things that don't look like equities would you be interested? Some folks would be and if this ever becomes easily investible maybe it can be one of those things.
The picture at the top of the post is in downtown Juneau. Thanks for all the kind comments about Kramer. As some folks commented this goes with having dogs (or cats). A few days of sadness are worth all the positives of having dogs. You expect to outlive your dog (which is why they are not like children) so you know they will pass away at some point. Thanks again.
5 comments:
The Moses spike in about 1988 could have been by Gordon Gecko just before he went to jail :)
I attend science fiction conventions and the SF art market crashed in 1991 by 2/3 on prices. It hasn't recovered since then except for maybe inflation. It's just like the Japanese endless bear market. The western art market appears to be a bit healthier with prices about 10x more than the smaller SF market.
Paul
Here's a research paper on a stamp index. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=968343
good stuff everybody.
the stamp idea is interesting too. although based on the CNBC coverage could Bill Gross crash the stamp market? lol
lest anyone add 1+1 and get eleven i think people should be open to learning about anything, art and stamps included, but that does not mean they should invest in those things.
We bought a painting in 1957 for an amount I ca not recall but it was evaluated in 1971 for 8K$, evaluated again in 1991 for 25K$; and we have it on extended loan with a large civic art gallery that has it assessed at 37K$. We'll likely give it to them in return for an income tax receipt and we are in a 50% bracket. That's an average annual value increase of 7% over 27 years but we will only benefit from half of that in a tax return. Not a great deal. Right?
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