Posts filed under “Fixed Income/Interest Rates”

Better Than All Weather Portfolio . . .

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My Sunday Washington Post Business Section column is out. This morning, we take yet another at Tony Robbin’s All Weather Portfolio.

The print version had the headline Why the all-weather portfolio is a wash-out while online, it was Better Than All Weather Portfolio.

Rather than merely criticize Robbin’s 55% bond, 15% commodity portfolio, I offered up a variation of a classic 60/40:

All Century Portfolio
20 percent total U.S stock market
5 percent U.S. REITs
5 percent U.S. small cap value
15 percent Pacific equities
15 percent European equities
10 percent U.S. TIPs
10 percent U.S. high yield corp bonds
20 percent U.S. total bond market

And to add a little spice to the discussion, I challenge Robbin’s to a $100,000 bet:

I am willing to bet Tony Robbins that my Century portfolio will significantly outperform his all-weather portfolio over the next 20 years. Toward that I end, I propose that each of us puts $100,000 into our own portfolios. Set it with whatever automatic rebalancing you want — then leave it alone. On Jan. 1, 2035, whichever one is worth more is declared the winner. The loser then donates that original $100,000 investment to the charity of the winner’s choice . . .

Seems like easy money to me

 

Source:
Why the all-weather portfolio is a wash-out
Barry Ritholtz
Washington Post, December 7, 2014
http://wapo.st/1wh8SEn

Category: Apprenticed Investor, Asset Allocation, Fixed Income/Interest Rates, Investing, Really, really bad calls

Muni Mania: A Timeline

Source: Bloomberg Briefs

Category: Credit, Fixed Income/Interest Rates, Markets, Really, really bad calls

Economics Indicators Dashboard

Here’s the monthly update from Russell:   click for interactive graphic Source: Russell Investments

Category: Consumer Spending, Data Analysis, Economy, Employment, Fixed Income/Interest Rates, Inflation, Markets

Fed Policy and Stock Outlook

Fascinating stuff here: The Easy Money’s Been Made: Fed Policy and Stock Outlook Source: Bloomberg Chart of the Day

Category: Federal Reserve, Fixed Income/Interest Rates, Markets

U.S. Debt Held by Foreigners Hits Record $6.07 Trillion

Posted without comment: Source: Real Time Economics

Category: Credit, Data Analysis, Economy, Fixed Income/Interest Rates, Taxes and Policy

Restoring Confidence in Reference Rates

Restoring Confidence in Reference Rates October 2, 2014 William C. Dudley, President and CEO, NY Fed Remarks at NYU Stern School of Business, New York City       Thank you for the opportunity to speak with you today.1 In my remarks today, I will focus on the development and use of reference rates for…Read More

Category: Federal Reserve, Fixed Income/Interest Rates, Think Tank

Bill Gross’s Farewell Letter to PIMCO

Bill Gross, founder of Pimco, and its chief investment officer for the past 40 or so years, resigned last week. Rumor has it that he was but two steps ahead of a mutinous gang, swords out, planning to make him walk the plank. Gross was too quick and before the mutineers could force him, he…Read More

Category: Corporate Management, Fixed Income/Interest Rates

Open Secret of Libor Manipulation

open secretOpen Secret: The Global Banking Conspiracy That Swindled Investors Out of Billions is the new book written by Erin Arvedlund.

The book goes behind the scenes of the elite firms that trafficked in LiBOR based products, including Barclays Capital, UBS, Rabobank, and Citigroup to show the negative impact they had on both ordinary investors and borrowers.

Erin’s claim to fame was a column she wrote in Barron’s in the early 2000s outing Bernie Madoff as a fraud. It was a national bestseller titled Too Good to Be True.

Here is Yahoo:

“LIBOR, the London Interbank Offered Rate, is a global benchmark for interest rates. It’s tied to everything from mortgage rates and student loan rates to complex financial derivatives. And guess what? For a very long time it was rigged.

Now, multiple lawsuits are pending, and that could mean some money back for some investors, traders and consumers.

LIBOR is set each day by a group of bankers, based on estimates of rates at which banks would expect to borrow money from each other. It’s a system built on trust, not math. Regulators were tipped off back in 2007 that banks were fixing rates, and by the summer of 2012, an ugly scandal was revealed. An estimated $300 trillion in financial securities worldwide are based on LIBOR.

Video after the jump . . .

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Category: Books, Fixed Income/Interest Rates, Legal

A World of Sovereign Risk

Interesting interactive graphic from Blackrock:


Source: BlackRock

 

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Category: Credit, Data Analysis, Economy, Fixed Income/Interest Rates

High Quality Liquid Assets and Munis

HQLA and Munis David Kotok September 8, 2014     High Quality Liquid Assets (HQLA) is a term that now applies to the implementation of the Liquidity Coverage Ratio (LCR) in the Basel III Rule. This highly technical mouthful of acronyms and rules specifically applies to banks, their liquidity requirements and the rules governing the…Read More

Category: Fixed Income/Interest Rates, Think Tank