Timeless retirement investing advice: Use index funds and don’t get greedy

This is so simple but so important.  Trying to out-guess the stock market experts is for suckers.  I learned early in my career that even with loads of internal information that you still can’t predict what the market will do.  I never traded on it, of course, but there times when Compaq would release record earnings but the stock would go down because of some comments about future performance.

Just invest in broad index funds (mutual funds that mimic the overall market).  There is no need to chase stock tips or highly managed mutual funds.  The only exception would be if your employer sold you stock at a discount, which would mitigate the risk.  Just don’t be foolish like a lot of Enron employees were and put most or all of your retirement money in one company.  I knew way too many people at Compaq and HP who tried to time peaks and missed out.

As noted below, keep in mind the simple math: Index funds with minimal fees will yield 7%.  Managed funds will be more like 5%.  So you are 2 points behind, right?  No, it is much worse.  If inflation is 3%, then your net gain with index funds is 4%.  That’s double what you’d get with managed funds.

Via AAII: The American Association of Individual Investors.

Charles Rotblut CR: Since you founded Vanguard, would you explain why you think investors should use index funds?

John Bogle JB: Let’s start off with the obvious. Imagine a circle representing 100% of the U.S. stock market, with each stock in there by its market weight. Then take out 30% of that circle. Those stocks are owned by people who index directly through index funds. The remaining 70% are owned by people who index collectively. By definition, they own the exact same portfolio as the indexers do in aggregate, so they will capture the same gross return as the direct indexers. But by trading back and forth, trying to beat one another, they will inevitably lose by the amount of their transaction costs, the amount of the advisory fees they pay, and the amount of all those mutual fund management costs they incur: marketing costs, processing, technology investments, everything. When we look at the big picture of the costs of investing, including sales loads as well as expense ratios and cash drag, it is a foregone conclusion that active investors, in aggregate, will underperform index investors. It’s the mathematics.Borrowing a phrase from Louis Brandeis: It’s the relentless rules of humble arithmetic. The 30% of investors who own index funds capture almost all of the market’s return. In a 7% return market, indexing should deliver approximately 6.95% to investors. A typical Vanguard all-market index fund charges 0.05%. The remainder—those who are trading back and forth, hiring managers, and all that kind of thing—will incur costs, in round numbers, of about 2% per year. So, the indexers are going to capture pretty close to a 7% return in a 7% market, while the active investors, who also collectively own the index, are getting the same 7% gross return minus about 2% for all those fees and costs, a net return of 5%. It is definitional tautology that the indexers win and the traders lose.

I highly recommend Vanguard for their mutual funds.  They are very easy to do business with and have extremely low fees.

“Tithe for 90 days and God will bless you — or your money back!” and other scams

An old investment scam went like this: A stock tip would be sent to random people, but half the people would be told the stock would go up, and half that it would go down.  It was a free, no-strings-attached offer designed to build trust with whichever half got the correct advice.  This would go on for a few rounds until the remaining group thought they were getting advice from Warren Buffet himself, as in, “Wow, this guy has been right 6 times in a row!  Please take lots of my money and invest it for me!”  Of course that would be the last they’d see of their money.

I was reminded of that scam when I read about this:Texas Megachurch Promises 100 Percent Refund in Tithe Challenge if ‘God Doesn’t Hold True to His Promise of Blessings’.

Fellowship Church in Grapevine, Texas, led by Pastor Ed Young, has launched a 90-Day Challenge, encouraging members of the multi-campus megachurch to put God to the test by “bringing their tithes and offerings to the House.” “Each of us has a unique opportunity to be a part of the incredible life change happening around us at Fellowship Church by bringing our tithes and offerings to the House,” reads a description of the 90-Day Challenge. “If you are not tithing already, the 90-Day Challenge is the best place to start. We commit to you that if you tithe for 90 days and God doesn’t hold true to his promise of blessings, we will refund 100 percent of your tithe.”

Think about it: If you feel extra-blessed during the 90 days, you’ll keep tithing, so the church will win.  And even if you don’t feel blessed and they return your money, there is no net loss for them.  You weren’t tithing before, right?  And think about how few people will actually contact the church to demand a refund even if they didn’t feel extra-blessed.  According to false teacher Perry Noble’s video, all you have to do is call God a liar and they’ll return the money, no questions asked.

Why don’t they just preach the Bible accurately and skip the gimmicks?

2 Corinthians 9: 6-7 The point is this: whoever sows sparingly will also reap sparingly, and whoever sows bountifully will also reap bountifully. Each one must give as he has decided in his heart, not reluctantly or under compulsion, for God loves a cheerful giver.

There was no mention of a tithe there.  The only mention in the entire New Testament was where Jesus whales on the Pharisees for tithing on their garden spices but neglecting the weightier matters of the law.

My official stance on giving is captured in Thoughts on tithing: Something to offend everyone!, where I note that if God expected the poorest Israelite to tithe and more, then maybe 10% isn’t so unreasonable to aim at.  It is a nice round number.  In fact, most of the people reading this are in the riches 1-2% of people who have ever lived.  Yet I would never want to suck the joy out of giving, so why would I be legalistic and demand a specific percentage when Jesus didn’t do so?  These guys distract from the Gospel and make the church look foolish to non-believers.

It is pretty obvious who will really be “blessed’ by this tithe campaign.  My prayer is that those being challenged with the “90 day tithe” will take 2 Corinthians 9 to heart and give joyfully based on what they have decided in their hearts to give — but that they will give it to a ministry with sound doctrine instead of these 

Hat tip: Glenn

Only the Molech-worshiping Left could vote down care for babies who survive abortions

While the PC USA religious group was busy endorsing “same-sex marriage” and bashing Jews, lots of people missed this gem: Presbyterian Church USA Defeats Motion to Care for Babies Born Alive After Abortion (apparently they hate on bisexuals, though, because they will only marry two people).

These people have been supportive of baby-killing for decades, but you really have to be super-duper-pro-abortion to oppose helping those born alive.  Yet here we are.

Roundup

Former Employee of ‘Big Cheese’ Wrote FDA Letter that Put NY Artisan Cheese Makers Out of Work – Just another variant of Crony Capitalism, which isn’t capitalism at all – just big businesses buying favors from both parties.  The bigger the government is, the more of this you’ll get.  This should be common ground for the Left and the Right. 

12 Questions to Ask Before You Watch ‘Game of Thrones’ – Good questions to ask about any media you consume.

Study: most couples who stick it out through an unhappy period return to happiness – Good news, and one more reason not to divorce (although the Bible is the only reason you really  need).  As some famous guy noted (C.S. Lewis, I think), wedding vows aren’t for when times are good, because you don’t need them then.  The vows are for when things are tough.

The Pathology of the ‘Male Feminist’ – Yep.  There is a reason you find lots of frauds in those roles.  Typical “Bro-choice” guys. 

“He Dropped Me Off at the Abortion Clinic and Never Returned, Now Every Day I Mourn My Baby” – And yet another “bro-choicer.”  This is a common theme: Women who don’t want to kill their children but do so to keep a jerk of a guy who will end up leaving anyway.  Please consider that guys who want to kill their kids probably aren’t “keepers.”

VA destroyed records to cover up massive cancellations for wait-list fraud – More predictable results of a large, mostly unaccountable government institution.  They should have just given veterans discounts on insurance and let them use regular institutions.  More competition = lower costs, better service and less corruption.

Convicted Heavy Metal ‘Christian’ Singer Admits Being Atheist, Duped Fans to Sell Music – He tried to have his wife killed.  The guy isn’t terribly credible, but it was interesting that he noted that only 1 in 10 bands they toured with were really Christian.  Fame can be poisonous.  His atheistic worldview sure helped him rationalize a lot of evil: Adultery, conspiracy to commit murder, living as a fake Christian for profit, steroid use and more.  But there is still hope for him if he repents and believes. 

“The first time I cheated on my wife, my interpretation of morality was now convenient for me,” Lambesis explained. “I felt less guilty if I decided, “Well, marriage isn’t a real thing, because Christianity isn’t real. God isn’t real. Therefore, marriage is just a stupid piece of paper with the government.”But he continued to profess to be a Christian, as did others in the band, in order to sell records to Christian music fans.

I wonder if the atheists realize that his behavior counts against their worldview, not ours.  He was apparently persuaded by “New Atheists” like Richard Dawkins. 

Stay classy, Hillary — It doesn’t sound like it was a “hard choice” for her to attack a 12 year old rape victim.  This is a thousand times more of a “war on woman” than anything the media exaggerates for Republicans.  If the media is forced to talk about this it will hurt her.

The Daily Beast’s Josh Rogoin took a break from his national-security beat and tracked down the victim in that crime, now 52, who alleges that Hillary Clinton did attack her as part of the defense, and much more. In the exclusive interview, Rogin reports the woman’s accusation that Hillary Clinton lied in court documents to portray her as a sex-crazed spoiled brat who threw herself at older men and then accused them of rape:

The victim’s allegation that Clinton smeared her following her rape is based on a May 1975 court affidavit written by Clinton on behalf of Thomas Alfred Taylor, one of the two alleged attackers, whom Clinton was appointed to defend.

“I have been informed that the complainant is emotionally unstable with a tendency to seek out older men and engage in fantasizing,” Clinton, then named Hillary D. Rodham, wrote in the affidavit. “I have also been informed that she has in the past made false accusations about persons, claiming they had attacked her body. Also that she exhibits an unusual stubbornness and temper when she does not get her way.”

Clinton also wrote that a child psychologist told her that children in early adolescence “tend to exaggerate or romanticize sexual experiences,” especially when they come from “disorganized families, such as the complainant.”

The victim vigorously denied Clinton’s accusations and said there has never been any explanation of what Clinton was referring to in that affidavit. She claims she never accused anyone of attacking her before her rape.

“I’ve never said that about anyone. I don’t know why she said that. I have never made false allegations. I know she was lying,” she said. “I definitely didn’t see older men. I don’t know why Hillary put that in there and it makes me plumb mad.”

. . .

Addendum: It’s worth noting that the Free Beacon has been banned from the University of Arkansas library archives after making the audio of the interview public. That decision, Alana Goodman reports, was made by a donor to … Hillary Clinton.

FIVE QUESTIONS FOR CHRISTIANS WHO BELIEVE THE BIBLE SUPPORTS GAY MARRIAGE – Great list.  Number 4 is always interesting.  Mention this and watch the pro-gay “Christians” squirm.  Gays have 40+ times higher rates of Syphilis and HIV, partly because 62% of men who know they are HIV-positive have unprotected sex with men.  Then there are the health risks cited below. Why don’t the Leftist churches, mainstream media and “comprehensive sex education” classes tell you about these things?  Apparently facts can be “homophobic,” too.

4. What will you say about anal intercourse?

The answer is probably “nothing.” But if you feel strongly about the dangers
of tobacco or fuss over the negative affects of carbs, cholesterol, gmo’s, sugar, gluten, trans fats, and hydrogenated soybean oil may have on your health, how can you not speak out about the serious risks associated with male-male intercourse. How is it loving to celebrate what we know to be a singularly unhealthy lifestyle? According to the Journal of the American Medical Association, the risk of anal cancer increases 4000 percent among those who engage in anal intercourse. Anal sex increases the risk of a long list of health problems, including “rectal prolapse, perforation that can go septic, chlamydia, cyrptosporidosis, giardiasis, genital herpes, genital warts, isosporiasis, microsporidiosis, gonorrhea, viral hepatitis B and C, and syphilis” (quoted in Reilly, 55). And this is to say nothing of the higher rates of HIV and other health concerns with disproportionate affects on the homosexual community.

Where the Next School Shooting Will Not Take PlaceGreat to see people implementing crime-preventing, life-saving policies.

Union Grove ISD officials [last month] put up signs outside their schools stating employees are armed and will “use whatever force is necessary” to protect students in the district, according to News-Journal news partner KETK.

The Union Grove ISD board in January enacted a policy to allow select, licensed and trained teachers and administrators to possess a firearm on campus. Community members wholeheartedly supported the move.

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Does anyone — Republican or Democrat — really think that the IRS emails don’t implicate Obama?

I’d love to have a polygraph done on anyone denying it.  This should be front-page news until the issue is closed.  The notion that 7 people lost just the emails related to the scandal and that there are no backups anywhere is so ludicrous that to deny it is to be complicit in the cover-up.

Consider Watergate vs. the IRS abuses, via Protecting the Precious | RedState.

The whole thing involved, in large part, 18 minutes out of 300,000 minutes of audio tape and a potential cover up of a crime. Editorialists at the time were calling for a deeper investigation. They denounced Bork for firing Cox — an act he clearly did not want to do. The media demanded independence, a congressional investigation, and scalps.In Washington today, the circle of jerks covering President Obama is more interested in scalping the Redskins than getting to the bottom of how 7 employees of the IRS could suddenly have their emails erased with no backups. So many of their spouses work for President Obama, they feel their chief duty is to protect their precious.

 

Roundup

This guy is great. He even names names.

The United States produced enough energy to supply 84 percent of its needs in 2013 – This is truly great news.

While we should always be wary of advocating for the canard of “energy independence”purely for its own sake — because doing so means eschewing the competitive, price-controlling, and wealth-creating powers of free and open trade and instead inviting the protectionism that generally benefits special interests over all consumers — it’s always worth looking at just how far the United States has come in terms of oil-and-gas production capacity in just a few short years, both in terms of boosting our energy security with diversified sources (including ourselves) and for boosting our ability to compete in the global economy by growing our own.

ER use skyrocketing with Obamacare?Of course.  Overwhelmed ERs were supposed to get relief due to Obamacare, but the easily anticipated law of unintended consequences says otherwise.  Obamacare reduces supply (fewer doctors willing to accept Medicaid and Obamacare plans) and increases demand (free money!).  That couldn’t do anything but increase demand for ER visits.  Were they foolish for not anticipating this?  Probably, but the more likely scenario is that they knew but didn’t care.  This is all about government control and single-payer.  It was never about increased health care coverage.

Before you say, “That could never happen!,” remember that just a few years ago no one thought the government could force you to participate in a “same-sex marriage” and that if you refused you could be fined and either lose your business or be forced to go to “reeducation” training.

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New study: relationship problems, not family rejection, leading cause of higher gay suicides – This is an important article, as it debunks many myths about the tragedy of gay suicides.  Disagreeing with people does not make them kill themselves.  Our media, entertainment and schools hate Christians but that doesn’t make me want to hurt myself.  As the article shows, even those gay leaders trying to make a case for happiness end up wildly disillusioned.

I think that the problem is that in the gay lifestyle, you have a typically male emphasis on physical appearance, sex and pleasure. There is none of the moderating influence of women, which tends to push men into commitments, responsibility and stability.

If you really love a person, then you don’t tell them that the dangerous thing they want to do is not dangerous. That’s not love. It’s easier for you to approve of them and be liked by everyone, but it’s not love.

Causes of Death in 1900 vs. Today: One Chart Puts Firearms & Natural Disasters Threat in Perspective – Deaths from guns and natural disasters makes the news because they are rare, but the attention makes people think they are the real problem.  Eating a little less and a little healthier and exercising a little more would save countless more lives than any counterproductive “climate change” or gun control measures.

What you’ll see is that America has been whipping infectious diseases for over a century, thanks to better sterilization, sanitation, and vaccination techniques, and now, Americans are living nearly twice as long. Currently, the average age is around 79 years old, and back in 1900, it was about 47 years old. Some “crisis” we have on our hands.

But it’s what you don’t see on this chart that is really the story. Natural disaster and extreme weather-related deaths don’t even make the chart.

In light of the federal government’s drive to enforce stricter environmental regulations for the reason of combatting manmade “climate change,” it should be said that 98% fewer people are dying from extreme weather events or natural disasters than in the 1920s. Extreme weather events currently comprise about 0.07% of all fatalities globally.

We’re also being told about the danger posed by law-abiding citizens possessing firearms. But where is that threat on this chart? Let me help you: It’s not there. Deaths from firearms totalled 31,672 in 2010 (just to keep the comparisons apples to apples). In that year, around 19,392 of those deaths were from firearms-related suicides (half of all suicides).

What about accidents? Around 570 of those were from firearms of a total of 126,100 accidents. Firearms murders, mostly by handgun, came to about 8,775 counts (of 12,996 total murders) in 2010, according to FBI statistics.

Where does this put these in the big picture? Deaths from heart disease in 2010 were 595,444 total, while deaths from cancer were 573,855.  One factor for such high rates to keep in mind is that Americans are dying from causes that strike those who live longer than human beings ever did before (risk factors go up after age 47).

Boy Scouts’ Gay Leader Ban Preserves Worst Stereotypes, Holder Says – Kevin Johnson | God’s Politics Blog | Sojourners — Gee, why would the blog of Jim “the Gospel is all about wealth redistribution” Wallis do a fluff piece like that?  Because they are wildly pro-gay but trying to pretend they are not.

What is most despicable about this is that they are advocating to have homosexual men spend time alone — even on overnight trips! — with young boys.  That’s just sick.  Even honest gay leaders will tell you about how aggressively many gays will pursue young men.

Wallis & Co. just get more and more despicable.  They actually think that being pro-abortion and pushing to have gays hang out with young boys is “social justice.”  These Leftists mock God 24×7.

BRAZIL’S CHILD SEX WORKERS FORCED TO CASH IN ON WORLD CUP – What a tragedy.  This will be even worse at the next Olympics.  The numbers are staggering.

A good Hillary summary – Hopefully someone will throw a bake sale or something to raise money for her.  Then again, your definition of “dead broke” is pretty elastic if it includes buying a second mansion so you can carpetbag your way into the Senate while your husband pulls down huge lifetime retirement payments.

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The Hebrew Roots / Sacred Name Movement

I’ve been hearing people refer to this movement, which is apparently growing.  Here is a good overview if you know someone exploring it or a part of it: Sola Sisters: Addressing the Hebrew Roots / Sacred Name Movement.

The Hebrew Roots Movement/Sacred Name Movement are a fast-growing works righteous movement which are a modern day form of “Judaizing,” the heresy that the Apostle Paul had to address several times in his ministry. From an article posted at The Berean Call by Richard Fisher, the movement is described this way:

“(The Hebrew Roots Movement) is a very modern movement that insists that we must resurrect first-century Judaism (our Jewish Roots) and the milieu and lifestyle of first-century Jews and impose them on both Jewish and non-Jewish believers. This is not just an academic study to better understand Scripture and its setting but is rather a movement of restoration that claims that the church has moved off its Jewish foundation and must return to a more Jewish way of life to be authentic.” (online source)

As always, the best antidote to these heresies is to read the Bible for yourself.  You’ll realize far from reality they are.