Historical Returns with Dollar Cost Averaging

Research on Safe Withdrawal Rates

Moderator: hocus2004

JWR1945
***** Legend
Posts: 1697
Joined: Tue Nov 26, 2002 3:59 am
Location: Crestview, Florida

Historical Returns with Dollar Cost Averaging

Post by JWR1945 »

I was surprised recently while looking at the accumulation phase of investing. There were several instances in which dollar cost averaging would have lost money at 15 years. This has caused me to reexamine my recommendations for investments during the next few years.

Normally, I would have almost always recommended dollar cost averaging into stocks. There are always exceptions due to individual circumstances, but this is different. We are most likely entering into an extended bear market. We need to revise our short- and intermediate-term recommendations. These are general updates, not limited to a few special cases.

Data Collection

I used my latest Deluxe Calculator V1.1A07, which is a modified version of the Retire Early Safe Withdrawal Calculator, Version 1.61, dated November 7, 2002.

I started with an initial balance of $1000 and made annual withdrawals equal to minus 100% of the initial balance (plus inflation). This corresponds to making annual deposits equal to plus 100% of the initial balance (plus inflation). I allocated 100% of the portfolio to stocks (as represented by the S&P500 index with all dividends reinvested). I set expenses equal to 0.00%.

I collected data on the balances at 5, 10, 15 and 20 years starting from 1871. In addition, I converted these balances into the percentage increases as compared to the amounts invested. That is, at five years, the total investment is $5000. I divided the balance at five years by $5000, subtracted 1 and then multiplied by 100%. This means that a balance of $6000 at 5 years is reported as a 20% increase (as compared to deposits totaling $5000). Similarly, at ten years the total investment was $10000. I divided the balance at ten years by $10000, subtracted 1 and then multiplied by 100%. And so on.

I reported negative percentage increases (i.e., losses) using parentheses. This makes them easy to identify.

Summary

There are several sequences that did worse than inflation-matched cash equivalents (i.e., TIPS and/or ibonds at an interest rate of 0.00%). Those in recent times started in the 1960s. Poorly performing portfolios consistently included the year 1975 as part of the dollar cost averaging period.

There were several additional sequences in earlier times during which dollar cost averaging did worse than inflation-matched cash equivalents.

I find it significant that the period of poor performance easily extends to ten and fifteen years. In 1899, 1901 and 1962, twenty years was not sufficient to equal inflation-matched cash equivalents.

Dollar cost averaging was superior most of the time. It was not superior all of the time. There are times when it is appropriate to preserve capital.

There is a weak relationship between the dollar cost average bonus and the percentage earnings yield in the first year of a sequence. R-squared ranges from 0.18 to 0.26. It takes an earnings yield above 6 to guarantee a positive advantage over 10 or 15 years. This corresponds to a P/E10 level of 17. It takes an earnings yield above 8 to assure an advantage at 5 years. This corresponds to a P/E10 level of 12 to 13.

Extrapolating (visually), today's P/E10 levels suggest that the odds of getting an advantage from dollar cost averaging (versus inflation-matched cash equivalents) is only slightly better than 50-50%.

At today's valuations and with today's stock market outlook, it is a good idea to consider alternatives to dollar cost averaging into the market as a whole. One attractive approach is to purchase income streams directly by focusing on dividends (i.e., using one of our dividends-based strategies). Buying TIPS and ibonds (while being careful about taxes) is an attractive alternative for those who may need to convert (some of) their holdings directly into cash quickly.

Have fun.

John R.
JWR1945
***** Legend
Posts: 1697
Joined: Tue Nov 26, 2002 3:59 am
Location: Crestview, Florida

Post by JWR1945 »

Dollar cost averaging $1000 per years for 5, 10, 15 and 20 years.

Year, 5-Year Balance, 10-Year Balance, 15-Year Balance, 20-Year Balance

Code: Select all

1871   7756    24870    39583    51984
1872   6191    20864    39679    59051
1873   7040    21282    36678    56616
1874   8633    20651    37276    50966
1875   9587    18434    37609    49758
1876  10822    20867    29865    44493
1877  10705    24914    40634    51581
1878   9336    19952    33953    51177
1879   6584    14757    22268    44493
1880   6855    18019    26819    44599
1881   7324    13492    22644    44688
1882   8379    17526    25020    53573
1883   7808    17020    28839    52246
1884   8085    15629    35083    44382
1885   7966    14915    27476    49539
1886   6397    13727    30051    53010
1887   7275    13289    31358    46125
1888   7433    16090    31917    38073
1889   6665    19113    26462    47589
1890   6436    15024    29583    43725
1891   6987    19043    36504    46734
1892   6176    17975    28773    40032
1893   8318    20313    26513    46319
1894   9271    15590    30571    37746
1895   7334    17545    28307    31677
1896   8638    20245    28477    38959
1897   8681    17103    26277    33463
1898   7728    12658    24552    22622
1899   5513    13710    18852    18700
1900   7817    16027    20088    21963
1901   8127    14711    22703    18037
1902   6875    13645    19641    20244
1903   5952    14804    15481    28988
1904   7390    12726    14350    27300
1905   7118    11435    14430    33311
1906   6689    13302    12248    37110
1907   7240    13411    16052    43774
1908   6923     9191    19648    55521
1909   5554     8322    18068    71778
1910   5904    10023    25955    74011
1911   7023     8670    28875    57676
1912   6247    10025    29573    35307
1913   4751    13524    40999    36788
1914   5069    13922    58459    53777
1915   5351    16835    50204    45688
1916   4484    17800    37075    59439
1917   5440    18559    23054    69276
1918   7356    25097    23431    48024
1919   7123    33648    32588    51788
1920   9375    31745    31039    57213

Code: Select all

1921  11218    26588    46528    52184
1922   9897    14296    47523    34960
1923  11000    12469    28523    33479
1924  14169    17394    30850    37649
1925  10229    13422    27675    38205
1926   7641    18980    23966    49335
1927   4695    21984    18442    34320
1928   4522    14111    19123    30086
1929   6559    15308    21574    30834
1930   6562    16886    26507    38767
1931  10322    15672    35976    48095
1932  13041    13054    26562    53699
1933   7424    12205    20860    50392
1934   7161    12979    20446    46089
1935   7146    14707    23792    64407
1936   5654    17822    26839    74471
1937   4775    13114    29889    73815
1938   5897    12788    34026    67123
1939   6817    13295    32478    85130
1940   7636    15137    43974    83747
1941   9232    16656    48811    75938
1942   6917    18836    48900    86380
1943   6163    20043    41876    77749
1944   6215    18562    51589    83237
1945   6966    24617    49723    86366
1946   7080    24895    41198    74795
1947   8580    26076    48898    68324
1948   9518    23179    45706    74322
1949   8751    28413    48914    71272
1950  10089    23875    44518    49566
1951  11004    21922    43168    45384
1952  10033    23270    35662    46022
1953   7972    19573    35119    46480
1954   9751    20965    33810    33310
1955   8397    20147    25222    21295
1956   7607    19214    22891    25121
1957   8280    16093    23548    25259
1958   7573    17098    25629    21471
1959   7788    16083    18211    21523
1960   8185    13041    12678    21343
1961   8268    12694    16136    23470
1962   6796    13068    16392    19731
1963   7223    14197    13989    24002
1964   7007    10526    14665    27009
1965   5753     7543    14827    27285
1966   5719     9786    16349    31919
1967   6343    10512    14330    40312
1968   6848     9062    17513    36813
1969   5212     9663    19713    39767
1970   4088    10282    20641    45822
1971   5587    11753    24889    42637
1972   5933    10210    30957    52347
1973   5032    12066    27047    50029
1974   5651    13807    29412    52157
1975   6302    14920    34841    51993
1976   6618    16890    30632    63424
1977   5627    20320    36427    72286
1978   6892    18049    35377    83973
1979   7213    18093    34193    95578
1980   7131    19717    31554    99736
1981   8083    17366    38635    85304
1982  10042    21428    45684    69717
1983   8094    19451    50045    
1984   8118    19020    57646    
1985   8514    16999    57906    
1986   7191    20208    47921    
1987   8041    21724    35623    
1988   7866    25053       
1989   7692    28566       
1990   6875    28258       
1991   8653    24146       
1992   9191    17833       
1993  10431          
1994  11682          
1995  11369          
1996   8420          
1997   6262          
Percentage increases follow.
JWR1945
***** Legend
Posts: 1697
Joined: Tue Nov 26, 2002 3:59 am
Location: Crestview, Florida

Post by JWR1945 »

Percentage increases over amount invested when dollar cost averaging of $1000 per years for 5, 10, 15 and 20 years.

Year, 5 Years, 10 Years, 15 Years, 20 Years

Code: Select all

1871   55.13    148.70    163.89    159.92
1872   23.82    108.64    164.53    195.26
1873   40.80    112.82    144.52    183.08
1874   72.65    106.51    148.51    154.83
1875   91.75     84.34    150.73    148.79
1876  116.45    108.67     99.10    122.47
1877  114.09    149.14    170.89    157.91
1878   86.72     99.52    126.35    155.89
1879   31.69     47.57     48.45    122.46
1880   37.09     80.19     78.80    123.00
1881   46.48     34.92     50.96    123.44
1882   67.57     75.26     66.80    167.86
1883   56.15     70.20     92.26    161.23
1884   61.70     56.29    133.89    121.91
1885   59.32     49.15     83.17    147.70
1886   27.94     37.27    100.34    165.05
1887   45.50     32.89    109.05    130.63
1888   48.66     60.90    112.78     90.36
1889   33.29     91.13     76.41    137.95
1890   28.72     50.24     97.22    118.63
1891   39.74     90.43    143.36    133.67
1892   23.52     79.75     91.82    100.16
1893   66.36    103.13     76.76    131.59
1894   85.42     55.90    103.80     88.73
1895   46.68     75.45     88.71     58.39
1896   72.75    102.45     89.85     94.79
1897   73.61     71.03     75.18     67.32
1898   54.56     26.58     63.68     13.11
1899   10.25     37.10     25.68    (6.50)
1900   56.35     60.27     33.92      9.81
1901   62.53     47.11     51.36    (9.81)
1902   37.50     36.45     30.94      1.22
1903   19.03     48.04      3.20     44.94
1904   47.80     27.26     (4.33)    36.50
1905   42.36     14.35     (3.80)    66.55
1906   33.77     33.02    (18.35)    85.55
1907   44.79     34.11      7.02    118.87
1908   38.45     (8.09)    30.98    177.61
1909   11.08    (16.78)    20.45    258.89
1910   18.07      0.23     73.04    270.05
1911   40.47    (13.30)    92.50    188.38
1912   24.93      0.25     97.15     76.54
1913   (4.97)    35.24    173.33     83.94
1914    1.38     39.22    289.73    168.89
1915    7.03     68.35    234.69    128.44
1916  (10.33)    78.00    147.17    197.19
1917    8.81     85.59     53.69    246.38
1918   47.12    150.97     56.21    140.12
1919   42.45    236.48    117.26    158.94
1920   87.50    217.45    106.93    186.06

Code: Select all

1921  124.37    165.88    210.19    160.92
1922   97.94     42.96    216.82     74.80
1923  120.00     24.69     90.15     67.40
1924  183.38     73.94    105.66     88.25
1925  104.58     34.22     84.50     91.02
1926   52.83     89.80     59.77    146.68
1927   (6.09)   119.84     22.95     71.60
1928   (9.57)    41.11     27.48     50.43
1929   31.17     53.08     43.83     54.17
1930   31.24     68.86     76.71     93.84
1931  106.44     56.72    139.84    140.47
1932  160.83     30.54     77.08    168.49
1933   48.49     22.05     39.07    151.96
1934   43.22     29.79     36.31    130.44
1935   42.92     47.07     58.61    222.03
1936   13.07     78.22     78.92    272.35
1937   (4.50)    31.14     99.26    269.08
1938   17.93     27.88    126.84    235.61
1939   36.34     32.95    116.52    325.65
1940   52.73     51.37    193.16    318.74
1941   84.63     66.56    225.40    279.69
1942   38.34     88.36    226.00    331.90
1943   23.27    100.43    179.17    288.74
1944   24.29     85.62    243.93    316.18
1945   39.32    146.17    231.49    331.83
1946   41.59    148.95    174.66    273.98
1947   71.60    160.76    225.99    241.62
1948   90.37    131.79    204.71    271.61
1949   75.02    184.13    226.09    256.36
1950  101.78    138.75    196.79    147.83
1951  120.07    119.22    187.79    126.92
1952  100.66    132.70    137.75    130.11
1953   59.44     95.73    134.13    132.40
1954   95.01    109.65    125.40     66.55
1955   67.95    101.47     68.14      6.47
1956   52.13     92.14     52.61     25.60
1957   65.60     60.93     56.99     26.30
1958   51.46     70.98     70.86      7.35
1959   55.76     60.83     21.41      7.61
1960   63.70     30.41    (15.48)     6.71
1961   65.35     26.94      7.57     17.35
1962   35.92     30.68      9.28     (1.35)
1963   44.45     41.97     (6.74)    20.01
1964   40.14      5.26     (2.23)    35.04
1965   15.05    (24.57)    (1.15)    36.43
1966   14.38     (2.14)     9.00     59.60
1967   26.86      5.12     (4.47)   101.56
1968   36.96     (9.38)    16.75     84.06
1969    4.24     (3.37)    31.42     98.83
1970  (18.24)     2.82     37.61    129.11
1971   11.73     17.53     65.92    113.18
1972   18.65      2.10    106.38    161.73
1973    0.63     20.66     80.31    150.14
1974   13.03     38.07     96.08    160.78
1975   26.04     49.20    132.27    159.96
1976   32.35     68.90    104.21    217.12
1977   12.54    103.20    142.85    261.43
1978   37.83     80.49    135.85    319.86
1979   44.25     80.93    127.95    377.89
1980   42.61     97.17    110.36    398.68
1981   61.67     73.66    157.56    326.52
1982  100.85    114.28    204.56    248.59
1983   61.88     94.51    233.63    
1984   62.35     90.20    284.31    
1985   70.28     69.99    286.04    
1986   43.83    102.08    219.47    
1987   60.82    117.24    137.49    
1988   57.32    150.53       
1989   53.83    185.66       
1990   37.49    182.58       
1991   73.06    141.46       
1992   83.82     78.33       
1993  108.63          
1994  133.64          
1995  127.38          
1996   68.41          
1997   25.24          
Have fun.

John R.
hocus2004
Moderator
Posts: 752
Joined: Thu Jun 10, 2004 7:33 am

Post by hocus2004 »

"Dollar cost averaging was superior most of the time. It was not superior all of the time. There are times when it is appropriate to preserve capital. "

I agree that this is a highly significant finding, JWR1945.

Conceptually, I think we are just seeing a different version of the same dynamic that applied re SWRs. Say that long-term stock returns were not correlated with starting-point valuation levels, that we lived in a world in which stocks provided the same sorts of long-term returns as they provide in the real world but in which it was not possible to engage in long-term timing. In those circumstances, I believe that dollar-cost averaging would always work equally well.

The reason why dollar-cost averaging generally "works" is that stock investments generally "work." What you are doing with dollar-cost averaging is diminishing one of the short-term risks of stock investing. If you don't dollar-cost average, there's a chance that you will put a large amount of money into stocks just prior to a short-term price drop and suffer the long-term consequences of doing so. By dollar-cost averaging, you are able to tap into the long-term benefits while side-stepping some of the potential short-term downside.

Your research shows that 4 percent is a rough approximation of the SWR that applies at average valuation levels. At some valuation levels it is a little higher, at some a little lower, at some a lot higher, and at some a lot lower. The SWR varies with changes in valuation levels. It seems to me to follow that dollar-cost averaging should also provide better results in some circumstances and worse results in others.

The succinct way of saying it is to observe that the intrinsic value of a stock investment varies with changes in valuation levels. You just are not buying the same thing when you buy at a low valuation level as you are when you buy at a high valuation level.

What throws people is that the intrinsic value of stock investment is good enough at moderate valuation levels to cause people to feel that it is not worth the trouble to calculate the difference that valuations make. The intuitive impression seems to be that, if valuations matter, then stocks should provide a neutral result at moderate valuation levels. If that were so, I think more people would "get it." They would see that stock investing has elements of a gamble to it, and that you put the odds on your side by taking note of the effect of valuations.

The reality is that stocks provide a far better than neutral return at moderate valuation levels. There is an element of gambling involved in stock investing. But there is also an element of participation in the returns of a business enterprise. When the gamble is neutral (times of moderate returns), the expected return is positive (one that generates a 4 percent SWR). It's only when valuations are very high that expected stock return fall to the neutral level, and those circumstances turn up rarely enough that people are able to fool themselves into believing that they do not matter.

Stocks are partly an investment and partly a gamble. The investment aspect overwhelms the gambling aspect at low valuation levels. At low valuation levels, you don't need to be lucky to get a good long-term return; it is a virtual certainty that you will. At moderate valuation levels, you are also likely to get a good return, but if you are unlucky it is possible that you will not get a return better than what is needed to support a 4 percent withdrawal (which is an OK return but not a great one). At extremely high valuation levels, you need to be lucky to get a return providing a higher SWR than what you could get with less volatile asset classes. At extremely high valuation levels, an unlucky returns sequence can wipe you out if you are taking a 4 percent withdrawal,.

I believe that what you are seeing with the dollar-cost averaging results in another showing of the significance of our finding that returns are correlated with valuation levels. This insight reaches in all sorts of directions. There are all sorts of things we can discover by following this insight where it leads us.

The thing that makes it hard for people to accept the discoveries made at this board is that they are so huge in importance that it strikes people as impossible that a few guys at a discussion board could come up with them. We just happened to be at the right place at the right time. What makes these discoveries possible is the nature of SWR analysis. When you are exchanging words back and forth, you can never get precise enough in your findings to develop the sorts of insights we have developed here. SWR analysis imposes a necessary discipline on the discussions. There is a precision to numbers-based analyses that does not exist with word-exchange analysis.

This is why I reject out of hand the suggestion put forward by a number of DCMs that the community should change the definition of SWR now that we have found that intercst got the number wrong. If we change to definition of SWR in such a way as to make the intercst findings plausible, we greatly undermine the power of the tool. SWR analysis is too valuable to discard just because one community member happened to get a number wrong in a study and is not man enough to acknowledge it.

Anyway, I think that your findings re dollar-cost averaging are exciting. I will be thinking more about the implications of the insights you have put forward in this thread in days to come.
JWR1945
***** Legend
Posts: 1697
Joined: Tue Nov 26, 2002 3:59 am
Location: Crestview, Florida

Post by JWR1945 »

I recommend looking closely at Figure 1.2 in Professor Shiller's data. It is a plot P/E10 versus years.
http://www.econ.yale.edu/~shiller/
http://www.econ.yale.edu/~shiller/data/ie_data.htm

I think that there is a story in this graph that is more useful than the first year's value of P/E10. The graph shows how multiples have risen and fallen.

In terms of my data, the years 1919, 1921 and 1975 stand out as being especially important. [Look at the dollar cost averaging results after ten years and then add ten years. That gets you to 1919, 1921 and 1975. You can see the same thing by looking at the fifteen year results and adding 15 years and so on.]

You will notice a general relationship between how P/E10 has varied over time and these years. The relationship is not precise, possibly because dollar cost averaging spreads things out over time.

An alternative interpretation would be to focus on a single especially bad year. Dollar cost averaging builds up a portfolio, but a bad year right at the end hurts a lot. This corresponds to my general observation that preserving capital is most important when you have capital to preserve.

Have fun.

John R.
User avatar
ElSupremo
Admin Board Member
Posts: 343
Joined: Thu Nov 21, 2002 12:53 pm
Location: Cincinnati, Ohio

Post by ElSupremo »

Greetings John :)
This corresponds to my general observation that preserving capital is most important when you have capital to preserve.
I agree with that John. Don't you think, as a general rule, this is more important toward the end of the accumulation phase than in the early stages? I've seen so many get hurt by "over investing" in their late 50's and early 60's. A continuation of the DCA approach while cutting back on market exposure when approaching retirement seems sound. That's been my plan for many years. I haven't seen any reason to change it. If you have sufficient funds for your retirement, why risk those funds? Just pondering.
"The best things in life are FREE!"

www.nofeeboards.com
unclemick
*** Veteran
Posts: 231
Joined: Sat Jun 12, 2004 4:00 am
Location: LA till Katrina, now MO

Post by unclemick »

Yes - I agree - remember if you are planning to ER, then defense can arrive early since retirement is not 65. The balance between offense/defense is a judgement call
Sans numbers - I plugged away on my 401k - even though I 'knew' I might not be matching inflation. Hindsight being - had I owned a crystal ball - 100% stocks - instead of 50/50.

Stocks are not manditory - but building a nest egg to allocate is - so you have something to play offense/defense with.
JWR1945
***** Legend
Posts: 1697
Joined: Tue Nov 26, 2002 3:59 am
Location: Crestview, Florida

Post by JWR1945 »

ES
I agree with that John. Don't you think, as a general rule, this is more important toward the end of the accumulation phase than in the early stages? I've seen so many get hurt by "over investing" in their late 50's and early 60's.
I agree with you totally. I addressed this first when I first became aware of its importance.

From An Illusion of Numbers dated Sun Apr 25, 2004.
http://nofeeboards.com/boards/viewtopic.php?t=2416
These three conditions are similar in many respects. But they are quite different.

In the first case, there were no contributions and no withdrawals. In the second, there were only contributions. In the third, there were only withdrawals.

Looking at the second and third examples, we see that when the bad year happens is tremendously important. Its importance is greatest when the balance is greatest. Its importance is smallest when the portfolio balance is smallest.

Thus, we can say that having a bad year does not matter too much when you have no money (or when you have very little money).
ES wrote:A continuation of the DCA approach while cutting back on market exposure when approaching retirement seems sound. That's been my plan for many years. I haven't seen any reason to change it. If you have sufficient funds for your retirement, why risk those funds? Just pondering.
In one of my recent investigations into the accumulation stage, I found that following 15 years of dollar cost averaging into 100% stocks with 15 years of preserving capital (using 2% TIPS and varying allocations in accordance with P/E10) was a winning approach. It reduced risk much, much more than it gave away in terms of any upside potential.

Consider changing the composition of your stock market exposure as well.

This has come up in our recent investigations of dividends-based strategies. One approach to financing one's retirement is to purchase income streams in the form of dividends that are likely to keep up or grow faster than inflation. The quality of dividends is much more amenable to analysis than prices in the short- and intermediate-terms (i.e., for the first ten years or so).

It turns out that carefully implemented dividend-based strategies have outperformed the market as a whole.

What is even better for your own purposes is that Alec has already identified a couple of good index fund/ETF choices in quality companies with high dividends. This gives you instant diversification and it frees you from having to select individual securities.

It is a good idea to include ibonds and/or TIPS, as you have indicated, as opposed to converting your holdings entirely to high dividend stocks. Income streams from dividends are not sufficient. Stock prices fluctuate a lot, even the prices of high dividend stocks. There will always be times when you need cash right away and selling stocks is a bad idea. Even if you do not need cash to spend, you might like to redeploy your money when bargains become available.

Have fun.

John R.
JWR1945
***** Legend
Posts: 1697
Joined: Tue Nov 26, 2002 3:59 am
Location: Crestview, Florida

Post by JWR1945 »

hocus2004 wrote:The thing that makes it hard for people to accept the discoveries made at this board is that they are so huge in importance that it strikes people as impossible that a few guys at a discussion board could come up with them. We just happened to be at the right place at the right time. What makes these discoveries possible is the nature of SWR analysis. When you are exchanging words back and forth, you can never get precise enough in your findings to develop the sorts of insights we have developed here. SWR analysis imposes a necessary discipline on the discussions. There is a precision to numbers-based analyses that does not exist with word-exchange analysis.
To me this is the most natural thing in the world. Perhaps it is my engineering background and the nature of my work before retirement.

The tools needed to make these investigations did not exist until recently. Before then, any investigation posed a tremendous software programming challenge. But in 2002 John Greaney developed the latest version of the Retire Early Safe Withdrawal Calculator using an Excel spreadsheet and he made it available for downloading. [He had made earlier versions of the calculator. What was still missing were the right questions to be answered.]

Engineers are well aware that Excel has a tremendously powerful software capability. This includes its ability to produce graphs and to fit curves.

The basic tools needed to conduct our analyses are the combination of having a good calculator and having it programmed as an Excel spreadsheet. My modifications have helped as well, primarily in terms of data reduction.

The only additional element that was needed was to have someone who was interested in the results and who asked a lot of questions.

Have fun.

John R.
User avatar
ElSupremo
Admin Board Member
Posts: 343
Joined: Thu Nov 21, 2002 12:53 pm
Location: Cincinnati, Ohio

Post by ElSupremo »

Greetings unclemick :)
Yes - I agree - remember if you are planning to ER, then defense can arrive early since retirement is not 65. The balance between offense/defense is a judgement call
Yep that's the way it is for me. I started my defense a couple of years ago with a target FIRE of 55. Playing off what John said my defensive hedge will be in RE with a few income producing properties in the mix.
"The best things in life are FREE!"

www.nofeeboards.com
User avatar
ElSupremo
Admin Board Member
Posts: 343
Joined: Thu Nov 21, 2002 12:53 pm
Location: Cincinnati, Ohio

Post by ElSupremo »

Greetings John :)
It turns out that carefully implemented dividend-based strategies have outperformed the market as a whole.
I've been reading what you folks have been saying about this for a while now and it's something I'm considering. When time allows I plan on doing more extensive research along these lines with an eye toward implementing this in my own portfolio down the road.

Your work here and the contributions of those you've mentioned has helped much and again I thank you, and them for all the effort. :D
"The best things in life are FREE!"

www.nofeeboards.com
hocus2004
Moderator
Posts: 752
Joined: Thu Jun 10, 2004 7:33 am

Post by hocus2004 »

"Your work here and the contributions of those you've mentioned has helped much and again I thank you, and them for all the effort. "

It's not exactly clear but my presumption is that you meant to convey your appreciation to me with your phrase "the contributions of those you've mentioned." If that is indeed the case, I am glad to hear you give me the credit I am due here. I think it sends a message to the entire community when the object of a long-running Smear Capaign is publicly thanked for the many positive contributions he had made. That's the sort of thing that visitors here need to hear before they are going to feel safe once again venturing to post at this place.

I'd like to see you go a few steps further in days to come. ES. Conveying thanks to me (presuming that that is what you intended with the words quoted above) is a start. You also need to provide the community assurances that Ataloss-type posters will not be welcomed here in the event that they darken our doorstep again in the future. I don't think that anyone has an objection to Ataloss or anyone else coming here if he plays by the same rules that all others play by (and that Ataloss himself agreed to play by when he signed up here). But if Ataloss comes back and then sends signals with his posting that he is back to destroy once again, the matter should be dealt with and the matter should be dealt with promtly.

Boards don't build themselves, ES. It takes work. Publication of my book has been delayed two years while I dealt with the nonsense gibberish put forward by the DCMs. There comes a point where I should not be expected to be required to carry that burden by myself any longer. I have given consideration to the idea of putting up a link at my web site to this board. I cannot in good conscience do that unless I hear some sort of word from you as to what sort of board you intend for it to be in the future. If I hear that you intend for it to be the sort of board that the FIRE board was in its Golden Age, then I of course want to do what I can to make that happen. If you intend to sit on your hands the next time that Ataloss or an Ataloss-type poster darkens our doorstep, I don't want visitors to my web site being exposed to that sort of ugliness.

My sense is that you are not prepared to put forward a clear statement today. Given the harm that Ataloss has done to you (by hurting the site, he hurts you too), I have a hard time understanding your hesitation. But given the wonderful work that JWR1945 has done for this community and given the importance of the SWR issue, I don't see that I have much choice but to wait this thing out a little longer.

If you get to a point where you feel comfortable in saying that you will enforce the rules in a reasonable way regardless of any past relationship you have with the poster causing the problem, please do so. You seem to me to have a genuine interest in doing work to advance the development of ther internet discussion-board communications medium. We have a tiger by the tale with this SWR issue. If we explored that issue in depth (and in a reasoned manner) at this board, I believe that we could set the internet on fire and ultimately set the investing world on fire. We have all experienced pain because of mistakes of the past, but the joy that we could experience by doing the right thing in the future would compensate 10 times over, in my estimation. There are many, many people out in the world who very much want to know what the historical data really says. You would be a hero in their eyes if you could work up the courage to do the right thing for community as a whole, for yourself, and yes, even for Ataloss. It is degrading to him that you offer him special treatment. The suggestion is that he is some kind of child that is incapable of playing by the same rules that apply to all others. He begins growing up when the rest of us make clear that we will insist on him either growing up or taking his leave of the playing field (the same applies to intercst, of course).

There are a good number in the community who are watching to see what you do before they make their own decisions. If you were to make a clear statement about your future intentions re this matter, I think we might get BenSolar back. I think we might get Wanderer back. I think we might get FoolMeOnce back. I think we might get PeteyPerson back. Call me a cockeyed optimist, but I think we might get raddr back.

Are we fish or foul? Are we Information Seekers here or are we Disruptor? Are we Straight Shooters or are we Defenders of the Conventional Methodology? The longer we go without answering those questions, the harder it becomes for us to make the right choices down the road. That's because community members need to line up on one side or the other and they need to hear that they will be protected if they choose the side that will allow the community to grow. You own the site, so your decision counts for more than the decisions of many others. You could swing this in a positive direction by making a choice in favor of decency and honesty and civility and a choice against word games and personal attack and deception.

Please think this over. Please think back to the time when you started the board and the goals that you had in mind for it then. Please put the little bit of power that you possess as owner of this site to work in opposition to the Ataloss agenda, or at least against the agenda that has come to be the obsession of Ataloss over the course of the past year or two.

You said on another thread that you don't give "a rat's ass" about any personal agendas that posters have. If you don't give a rat's ass about Ataloss's personal agenda, why not apply the same rules to him that apply to all the rest of us? Why not make the statement we need to hear so that we all can go back to talking about the subject matter of the board and not all need to live in fear of when we are going to experience the next visitation of the DCMs? I don't give a rat's ass about the personal jazz either. That's why I have made such a point of saying that no one poster can tell us what we can post and what we cannot post. No one poster or small group of posters should be able to intimidate the rest of us into compliance with their personal agendas. Those of us who don't give a rat's ass about these petty games that Ataloss and intercst play need to begin acting like it. We need to stand up to these individuals and tell them in clear and certain terms that, if they can't post according to the rules that govern us all, they are kindly invited to direct their posting energies elsewhere.
User avatar
ElSupremo
Admin Board Member
Posts: 343
Joined: Thu Nov 21, 2002 12:53 pm
Location: Cincinnati, Ohio

Post by ElSupremo »

Greetings hocus :)
It's not exactly clear but my presumption is that you meant to convey your appreciation to me with your phrase "the contributions of those you've mentioned
WOW! :shock: How in the name of Mt. Everest did you come up with this? :shock: My only intent was to complement JOHN for his research and posting efforts. He also mentioned Alec in connection with the dividend thing so I added "others". :roll:

I only care to respond further to one or two items of your post:
You also need to provide the community assurances that Ataloss-type posters will not be welcomed here in the event that they darken our doorstep again in the future.
Let me tell you about ataloss. I would welcome him back no questions asked! The only thing ataloss ever did was help me manage this place, contribute 1000's of posts here, get the wool pulled over his eyes by the mentally impaired raddr, and disagree with you! :roll:

He's got this paranoid thing going now that I've somehow sabotaged him but it's just not true. I hope he posts here again some day. If not I wish him nothing but the best. He was my friend and I miss him. :cry:
My sense is that you are not prepared to put forward a clear statement today.
Here is a clear statement. Anyone who wants may post at NFB. Just like you they will have their right to express their opinions. If two members disagree they will just have to be adult enough to either work out their differences or agree to disagree. As I've said before my hand holding days are over. So it's pretty simple now. Post here if you want. If not, post somewhere else.

If you really want a complement here's one for you. I appreciate your moderation of this board. 8)
"The best things in life are FREE!"

www.nofeeboards.com
JWR1945
***** Legend
Posts: 1697
Joined: Tue Nov 26, 2002 3:59 am
Location: Crestview, Florida

Post by JWR1945 »

ES to hocus2004:
If you really want a complement here's one for you. I appreciate your moderation of this board.
I will add that moderating this board can be difficult. I speak based on my past experience as moderator (on a temporary basis).

Great job! Thanks!

Have fun.

John R.
hocus2004
Moderator
Posts: 752
Joined: Thu Jun 10, 2004 7:33 am

Post by hocus2004 »

"WOW! How in the name of Mt. Everest did you come up with this? My only intent was to complement JOHN for his research and posting efforts. He also mentioned Alec in connection with the dividend thing so I added "others"."

JWR1945's post made reference to the role I have played, and you expressed thanks not only to JWR1945 but to others who he made reference to. So I don't think I was making so big a logical jump.

In any event, you should be thanking me for a lot more than my moderation of this forum, ES. The best days in this site's history were the early days, when there were extensive in-depth and informed discussions of the SWR topic at the FIRE board. I am the one who got the ball rolling on that topic, and I contributed many posts to those discussions. It is those sorts of discussions that get a discussion board site off the ground. I did that for you and you should properly be grateful for the role I played.

"Let me tell you about ataloss. I would welcome him back no questions asked! The only thing ataloss ever did was help me manage this place, contribute 1000's of posts here, get the wool pulled over his eyes by the mentally impaired raddr, and disagree with you!"

The Post Archives do not back you up on this, ES. Ataloss was the leader of the DCMs here. It was not raddr who enticed Ataloss into the DCM camp but Ataloss who enticed raddr. Had you taken action on Ataloss at an appropriate time, all of our troubles would have been averted. You have allowed your personal relationship with him to influence you re your responsibilities as site administrator.

"As I've said before my hand holding days are over"

If you have no intent of administering the posting rules in a reasonable manner, you should not ask newcomers to the site to read the rules. The clear suggestion of having rules posted is that the rules will be administered in a reasonable manner.

People have a right to know what they are getting into when they come to a site. If your intent is for this to be the wild-west shoot-them-up sort of site that JWR1945 quite properly described it to be in an earlier post, then you should let people know that that is the case. You have the right to run the site only for a small group of personal friends if that is what you elect to do. But you have a responsibility to let newcomers to the site know that that is your intention if indeed it is. Newcomers have a right to know whether the rules apply to everyone or whether pals of yours from the old days are exempt.
hocus2004
Moderator
Posts: 752
Joined: Thu Jun 10, 2004 7:33 am

Post by hocus2004 »

Here's intercst's take in a thread he started a few minutes ago titled "What's Happened to the FIRE Crowd?

http://boards.fool.com/Message.asp?mid= ... t=postdate

Intercst: "What's happened to all these former FIRE stalwarts? Raddr "mentally impaired", wanderer caught sobbing on a French beach with his d**k in his hands, hocus suffering from a variety of ailments from bi-polar disease to multiple personality disorder (MPD) to being just a run of the mill dumb a$$. It's all very disappointing and disheartening."

Is this a leader we all can take pride in or what?
User avatar
ElSupremo
Admin Board Member
Posts: 343
Joined: Thu Nov 21, 2002 12:53 pm
Location: Cincinnati, Ohio

Post by ElSupremo »

Greetings hocus :)
If you have no intent of administering the posting rules in a reasonable manner, you should not ask newcomers to the site to read the rules. The clear suggestion of having rules posted is that the rules will be administered in a reasonable manner.
Perhaps you should read over those rules again. These are guidelines. I expect(ha! :lol:) folks to be adult, civil and follow those guidelines. No where in there does it say ES has to wipe noses. :lol: I've tried that approach and IHMO it didn't work out to well. :roll:

I provide this site for all the reasons I have previously outlined. I do not have the time or inclination to be a referee. I gave you your own board here. Enforce any rules you like.
"The best things in life are FREE!"

www.nofeeboards.com
User avatar
ElSupremo
Admin Board Member
Posts: 343
Joined: Thu Nov 21, 2002 12:53 pm
Location: Cincinnati, Ohio

Post by ElSupremo »

Intercst: "What's happened to all these former FIRE stalwarts? Raddr "mentally impaired", wanderer caught sobbing on a French beach with his d**k in his hands, hocus suffering from a variety of ailments from bi-polar disease to multiple personality disorder (MPD) to being just a run of the mill dumb a$$.
Ouch! :lol: Good old intercst gives as good as he gets eh? ;)
"The best things in life are FREE!"

www.nofeeboards.com
JWR1945
***** Legend
Posts: 1697
Joined: Tue Nov 26, 2002 3:59 am
Location: Crestview, Florida

Post by JWR1945 »

Here's intercst's take in a thread he started a few minutes ago titled "What's Happened to the FIRE Crowd?
..
Is this a leader we all can take pride in or what?

What a list of accomplishments!
intercst is pathetic. He had a choice between glory and the gutter. He chose the gutter. [As originally in a poem and later in a song: the pig got up an slowly walked away.]

I thank God that we have ElSupremo and these boards. Without them, I would have no place to post my research.

Have fun.

John R.
User avatar
kathyet
Admin Board Member
Posts: 34
Joined: Thu Nov 28, 2002 4:00 am

Post by kathyet »

I second that motion and may I add that I appreciate everything you write as well John I may not get it all but I try and read it and want to say thank you to you, and all the others that spend there time trying to educate and explain there ideas to us. You all just keep up the good work...

Kathyet
Post Reply