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Golden Rules of Financial Safety (1999)

harrybrowne.org

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Re: Golden Rules of Financial Safety (1999)

#51

Post by [deleted] »

jordanlev wrote: post #32

> Rule #11: Create a bulletproof portfolio for protection. > The portfolio should assure that your wealth will survive any event — including an event that would be devastating to any individual element within the portfolio. In other words, this portfolio should protect you no matter what the future brings. > It isn't difficult or complicated to have such a portfolio this safe. You can achieve a great deal of diversif…

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Re: Golden Rules of Financial Safety (1999)

#52

Post by brndnmtthws »

25% cash is ludicrous and irresponsible. Cash has historically been a terrible 'investment', especially since most central banks have maintained a policy of creating annual inflation.

Warren Buffett has some interesting things to say about this: https://20somethingfinance.com/warren-buffett-is-moving-100-... and http://www.barrons.com/articles/buffett-bonds-terrible-in-co... for example.

Re: Golden Rules of Financial Safety (1999)

#53

Post by ybalkind »

BMarkmann wrote: post #7

Just for context, this is from Harry Browne, who was famously (and perhaps not entirely fairly) labeled as a "gold bug" throughout his career. He was something of a hero figure among those who subscribe to Austrian economic theory, and actually the candidate for the US Libertarian party for president several cycles back. Off-topic (?) from that article, I'd be interested to hear what he would have made of the current…

I've just read his self help book "How I found freedom in an unfree world", interesting approach, hardcore libertarian. I think he would like the decentralised aspect of crytocurrency.

Re: Golden Rules of Financial Safety (1999)

#54

Post by ravibala1 »

wiredfool wrote: post #14
metalliqaz wrote: post #5

Advice: Just do dollar cost averaging in an index ETF. Question: Why? Answer: This article.

What advantages do index ETFs have over a comparable index mutual fund against the same benchmark? Or, to ask another way, is there any reason to prefer anything other than Vanguard's Index500 vs anything else attempting to replicate the SP 500? (I call out the Vanguard fund because the fees are very low, .14% iirc.)

As others have mentioned, there isn't really much of a difference (apart from fees) when you're thinking about it as a vehicle for long-term holdings. Most of the time, 401k plans will not let you hold ETFs - they only let you hold mutual funds. Mutual funds usually can't be traded intra-day. You place your order and they buy/sell at the stated NAV on the close. ETFs can normally be traded intra-day. Again, ex-fees irrelevant to a truly long-term buy-hold-rebalance portfolio.

Re: Golden Rules of Financial Safety (1999)

#55

Post by pattle »

chillydawg wrote: post #20
pattle wrote: post #17

Earlier quoted context omitted.

Why not store the money in Bitcoin instead? It's outside of government control and you should get a nice return on your investment.

...or it might go to 0? Bitcoin is many things, but it certainly is not a savings account.

True it could, but theoretically the price should always go up. Plus there's risk in anything. I'd have thought that placing money in a foreign country is also pretty risky if you're not a citizen

Re: Golden Rules of Financial Safety (1999)

#56

Post by sulam »

Most of these look great. I am somewhat skeptical of Rule #8 about not giving anyone signature authority. Maybe he means this in a narrow sense that I don't understand, but when you have your money being managed for you, trades are being made on your behalf, you aren't doing them yourself. This is true from robo-advising all the way up to private banking and family funds.

Re: Golden Rules of Financial Safety (1999)

#57

Post by swendoog »

brndnmtthws wrote: post #52

25% cash is ludicrous and irresponsible. Cash has historically been a terrible 'investment', especially since most central banks have maintained a policy of creating annual inflation. Warren Buffett has some interesting things to say about this: https://20somethingfinance.com/warren-buffett-is-moving-100-... and http://www.barrons.com/articles/buffett-bonds-terrible-in-co... for example.

Possibly holding cash is useful for when you need to quickly capitalize on a drop in the market?

Re: Golden Rules of Financial Safety (1999)

#58

Post by stuffedBelly »

kbutler wrote: post #8

He missed rule #0: Wealth is what you save, not what you earn or what you spend. There are many people with very high income but spending as high (or even higher!), so they have little or no wealth.

Actually from a financial perspective, wealth is assets you own (equivalent to equity + liability). People with high net income should be investing as much as possible to let the money flow in the market. If everyone saves with no intention to invest/spend, it would potentially result in a stagnant economy.

Re: Golden Rules of Financial Safety (1999)

#59

Post by snikeris »

brndnmtthws wrote: post #52

25% cash is ludicrous and irresponsible. Cash has historically been a terrible 'investment', especially since most central banks have maintained a policy of creating annual inflation. Warren Buffett has some interesting things to say about this: https://20somethingfinance.com/warren-buffett-is-moving-100-... and http://www.barrons.com/articles/buffett-bonds-terrible-in-co... for example.

I think this article may clear some things up for you:

https://portfoliocharts.com/2017/05/12/understanding-cash-wi...

Harry's 25% cash isn't dollar bills, it's treasury bills, which have held up to inflation.

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