Jack Bogle, the Man Who Revolutionized Investing, Dies At 89 (marketwatch.com) 123
Thelasko shares a report from MarketWatch: You can thank Thomas Edison for the light bulb casting light in your home, Henry Ford for your affordable, mass-produced car, and Apple's Steve Jobs for the astonishing computer in your pocket. And Jack Bogle, who died Wednesday [at the age of 89]. The low-cost mutual funds he helped pioneer at Vanguard aren't as sexy or dramatic as other inventions. And you can't really touch or see them. But their effect on everyday lives has been enormous. Bogle's low-cost index funds, and the imitators they have inspired, may have saved ordinary Main Street Americans a staggering $250 billion, or more, in mutual fund fees over the last forty years. According to the Investment Company Institute (ICI), there are now about 450 index mutual funds with around $3.4 trillion in assets. There are also 1,800 exchange-traded funds, also with around $3.4 trillion in assets.
Why the fuck would I thank steve jobs for that (Score:2, Insightful)
He didn't invent shit. Pocket computers existed years before the iphone.
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Neither did Edison invent the light bulb.
Even if he did, I've never seen a carbon filament bulb in my life, so whatever is casting light in my home can't be it.
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I used to work at a smelter which still had original Edison carbon filament bulbs, and they still do. Quality is far better than flawed products
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It isn't really quality, it is just a strong trade off between efficiency and lifetime for filaments. Put a 220 V bulb on 120 V power, and it would last forever, although it will emit a lot less visible light per watt and give off a lot more heat per watt.
You don't even have to be that extreme, as the lifetime scaling is often like 5-8th power of variables, so small changes to the filament will make them last. You can still get rough service bulbs that last way longer, but expect to spend more on electric
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LOLZ yeah 240V bulbs in 120V supply:
Halve the voltage, get one quarter the power, and less than 10% the light output because of how filament resistance goes with temp.
you get a glowing night light.
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Whoosh.
The (only) point being made was that it will last a very long time.
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Halve the voltage, , and less than 10% the light output because of how filament resistance goes with temp.
Isn't it mostly a matter of radiation balance? One quarter the power should mean 71% of the thermodynamic temperature according to the Stefan-Boltzmann law. The radiation is of course those 25%, the question is how the spectrum shifts. I'm not sure how much it's depending on the initial condition, which hasn't been specified in this case.
get one quarter the power
how filament resistance goes with temp
Sounds like a contradiction; the former seems to assume constant resistance for an ohmic load at half voltage, while the latter seems to claim the opposite.
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No, there is a thing about the light needing to be visible. I didn't comment on the energy making the thing a nifty space heater.
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Jobs's engineers designed, improved and invented things, but Steve was just a designer, made things look pretty.
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but Steve was just a designer, made things look pretty.
No, Jony Ive was the designer. Jobs was the manager and salesman.
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doesn't matter, those are all wastes of carbon to me
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How does Jack Bogle only have a net worth of 80 million? Compare this to Bill Gates 80 billion...
Basically, Gates put all his eggs in one basket, and was right. Bogle spread his risk around, but lower risk means lower return.
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He didn't invent shit. Pocket computers existed years before the iphone.
And Edison didn't invent the light bulb, and Ford didn't invent the automobile.
They all three were instrumental in making each of their respective products popular and help them enter into the mainstream.
Thanks Jack. (Score:3)
But, still wondering, at what point the Index funds could be gamed?
10 million millionaires in the US in 401k index fu (Score:5, Informative)
Boring, low-cost mutual funds like the Vanguard funds are how about 10 million Americans have become millionaires. Mustn't they've held Vanguard or similar funds inside their 401K or other retirement plan. That's most millionaires.
Other interesting facts about millionaires:
33% of millionaires never made $100,000 in any year.
Most made less than $150K.
Millionaires are no more likely than the average American to have received any inheritance. (21% f people, and 21% of millionaires, inherit any money).
Less than 1% of millionaires made most of their money in one year, from a particular event. 99% consistently invested over the long term.
Most commonly held jobs of millionaires:
Engineer
Accountant
Teacher
88% of millionaires have a bachelor's degree, 52% have a graduate degree. About half are first time graduates - their parents didn't have a degree.
Of those will have a degree, most went to state schools rather than private schools, and 68% worked their way through school rather than taking out loans.
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Where I'm from, a millionaire is someone who owns a two bedroom condo.
Two bedroom condos is Silicon Valley [zillow.com]
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Yeah, but being a millionaire means very little now, you own your own home and little more. Yeah there are plenty of people who don't but you are by no means rich.
Also although actively managed funds are a rip off they charge you for their "expert" knowledge but generally under perform the market, and charge you a percentage of what you invested. To be fair they should charge a percentage of what they earn't over the market average (how you would expect monkeys to perform), and if they are below give you
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Most millionaires were created by inflation. The process by which the banksters steal money from the elderly, basically depreciating their assets, whilst the bankster manipulate funds to promote inflation and generate income based upon that inflation.
Re:10 million millionaires in the US in 401k index (Score:4, Insightful)
Call it what you will, this is the process used by over 80% of people who have at least a million dollars:
Typical salary $59,000.
Invest 15%* in boring ass index mutual funds for 25 years and you've got a million dollars.
Very simple, very boring, very effective.
* Employer match averages 5% with the worker investing 10%.
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Mostly this just illustrates the shifting definition of being a millionaire. The still most common definition is someone with a million dollars in assets, but as you have pointed out that is no longer a significant amount of money. It represents about $30-40k per year in retirement income (increasing with inflation). But the term is more frequently being used to describe someone who consistently makes $1 million per year in income. This requires either a very high paying job or over $25 million in assets. I
Net worth is the definition for the figures (Score:2)
To my mind, borrowing a million dollars doesn't make you a millionaire, it just makes you in debt. So the definition uses for the figures above is *net worth*. That is, what you own minus what you owe. The figures I provided are people with a net worth of *at least* a million dollars. The average is about $2.5-$3 million, I don't recall exactly.
For most millionaires that simply comes down to what's in their 401K or IRA. They've paid off their mortgage and bought their car three years ago with cash, typical
$50-60,000/year, no mortgage, little taxes (Score:2)
> It represents about $30-40k per year in retirement income (increasing with inflation).
Long term average market return is about 10% minus average inflation is 3.2%. Annual return without depleting your nest egg = $68,000.
It turns out that returns tend to be higher in years that inflation is higher and lower during periods of low inflation, so the real return (net of inflation) is more stable than you might think.
Put part of your money in safer, less volatile investments like bonds (not bond funds) and m
Try dividing by $50,000. Obviously saving is good (Score:2)
Somebody who has saved up over a million dollars is probably not someone who is going to spend every penny of their investment income as soon as they hit retirement. Having an income of $60,000 doesn't mean you spend $60,000 every year (that's a habit broke people have - spend all of their income or a little more, like I've done before).
So yeah, you probably wouldn't want to spend $60,000 - that doesn't mean your income isn't $60,000. It just means you decided not to spend 100% of your income.
But just for f
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The average life span of a 60 year old was never 72. The increase in life expectancy over the last 100 years or so has largely been the product of declining infant mortality and the elimination of many childhood diseases through vaccination (Measles, Polio, etc.). Heck, you can read texts from ancient Greece that talk about 80 years as a normal life span.
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At a 4% withdrawal rate, even 100% stocks looks pretty safe. If we use
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Re:10 million millionaires in the US in 401k index (Score:4, Interesting)
The data indicates that having typical middle-class parents raise you, driving to Starbucks in a car loan does tend correlate with the kids doing the same thing. So there is a correlation there - up to typical middle class status.
Those who do a lot better, millionaires and multi-millionaires, do *not* tend have rich parents, in fact the opposite is true. Multi-millionaires tend strongly to be people who budget and save, and that correlates with *lower* than average income of their parents when they grew up. Those who grow up with upper middle class parents tend to hand out money freely to Starbucks and Apple, and end up in debt or with little wealth. 80% of millionaires came from families that are middle class or lower.
Let's look at the mega-rich you mentioned. The Forbes 400 is perhaps the best known and best research list of the wealthiest Americans. Of the super-rich (Forbes 400), more had poor parents than had parents that were super rich. Most of these mega-rich built on what their parents or other family members had done. Fred was a millionaire, his son Donald is a billionaire (and a fuckwad).
One thing the mega rich tend to have in common in that they most often don't have hobbies they are passionate about, close friends, or much else other than money; they have focused on building their business empire and sacrificed other things. That's why I don't want to try to be mega rich. I'm good with $2 million, which doesn't require giving up time with my family - I just drink coffee at home with family rather than at Starbucks.
Not that it matters, but that's a lot of mortages (Score:2)
That particular example doesn't matter, I don't have a horse in that race.
I will note that you can't estimate the value of the company based on how many apartments they had - you have to subtract the mortgages on those apartment buildings. If the company buys a building for $20 million (because the competing bidder only offered $17 million), using a mortgage of $17 million, the value of the company is somewhere between $0 and $3 million. $20M asset - $17M loan against it = $3M value.
Also note that
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For the last 100 years investing an (inflation-adjusted) $5000 per year into the S&P 500 yields between ~$768,000 and $2.2 million (in inflation-adjusted dollars) after 40 years, on average. So tell me how putting a few thousand per year into the stock market won't make me rich?
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You pulled that number out of your rear. About 4% of Americans are millionaires, and many of those who aren't now, will be as they grow older. In all likelihood, more millionaires are long-term investors than not.
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One of the problems with the Dark Market is that so much money goes into hedge funds which try to exploit data transmission delays, and game the system, since index funds tend to order in large blocks, so they basically steal the arbitrage between the block orders, making the index purchases and sales just a bit more expensive for the index fund investors.
So you have a point. That said, if you don't trade out of fear, you'll usually be fine, since the bulk of your holdings aren't trading almost all of the t
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But, still wondering, at what point the Index funds could be gamed?
When every retirement account is invested in index funds that mimics the broader market, the next stock market crash will be a shared experience by everyone.
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2) My retirement savings are fine.
3) I'm not 50.
4)
5) Fuck off.
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But, still wondering, at what point the Index funds could be gamed?
When index funds were first implemented, they were too small to game. But as they became bigger, some investors figured out how to game them.
Here's how they did it: Buy (or go long on) the 501st stock in the S&P list, while simultaneously selling (or shorting) the 500th. Do this only when they are close enough in value to switch places because of your activity. So the stock you shorted is removed from the S&P 500, compelling the index funds to dump it, driving the price even lower, while the sto
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real interesting subject (Score:2)
If you are one of those fund managers who makes massive fees, you won't be thanking him. Curiously these index funds exploit the efficiency of the market created by traders and actively traded funds and reduce it by creating vast category of new investors that don't contribute to the valuation effort.
My hypothesis is that a secondary effect of them is to improve the performance of those who are prepared to research. The tertiary effect is that people drift back to actively managed funds. The net effect is t
Re:real interesting subject (Score:5, Informative)
Except the actively managed fund "experts" aren't actually any better at predicting the market. After fees, actively managed funds underperform low fee index funds with similar investment goals two-thirds of the time. And no, that doesn't mean one-third of actively managed funds are better than index funds; the overperforming funds change each year, and over 10 year periods, and the index funds win over 90% of the time.
So your premise is that index funds are free riders benefiting from the research of more informed investors, yet if that were the case, they should, by definition, underperform the actively managed funds since the index funds should in theory be buying lower and selling higher (since the index funds are always riding coattails, as it were, buying after others buy, and selling after they sell). And all that money in index funds should, by your theory, be making informed investment choices even more lucrative. Yet that's not how it goes in practice. In practice, even as the fees on actively managed funds have gone down, they've continued to underperform the index funds. The only way your theory jives with reality is if the majority of the so-called "informed" investors, including professional fund managers, have no real idea what they're doing (Note: Not going to dispute that possibility).
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That actively managed funds underperform the index fund after fees is not inconsistent with the hypothesis that they may overperform them before fees. My hypothesis is that the active fund managers and not their investors get the benefit of their research. As you say the fees on actively managed funds have decreased, however I do not think they can ever be as low as those on indexed funds. Not in the long term anyway, otherwise the manager is working for nothing.
I doubt you are claiming that if everyone inv
LOLZ that summary (Score:1)
wow the person that wrote that summary probably thinks Musk is an inventor too.
Ho hum (Score:4, Insightful)
Edison stole his invention, exploiting America's refusal to recognize intellectual property rights in other countries. So did many U.S. "inventors".
Ford was not the first to make cars, or even to make affordable cars. Ford was merely the best at getting his name touted.
Steve Jobs?? Bwahahaha! The least competent narcissist on the planet? He invented nothing. Nor did Apple come up with portable or handheld computers. Apple were late in the game and overpriced.
Don't revise history, just to pump up the obituary of someone. It makes a mockery of whatever they actually achieved.
Applaud REAL achievements.
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Keep chirping about trump, aspie