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Maybe Warren Buffett Is Warning Us About Something

bloomberg.com

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Re: Maybe Warren Buffett Is Warning Us About Something

#41

Post by dragonwriter »

bungie4 wrote: post #23
chosenbreed37 wrote: post #14

Earlier quoted context omitted.

I'm lost. Could you be more specific about this supposed heist?

Mr. Buffet pledged 80% of estate to the Bill and Melinda Gates Foundation, along with many, many other wealthy people for the betterment of mankind. By all accounts, The Gates Foundation is delivering on their promise by reducing child mortality, womens rights, life expectency, health care and education to the underprivileged of the world. Heist indeed. Sauce: https://www.gatesfoundation.org/

> By all accounts, The Gates Foundation is delivering on their promise by reducing child mortality, womens rights, life expectency, health care and education to the underprivileged of the world.

Except for the first item, that doesn't seem to say what you seem to think it does. Unless you mean to say that women’s rights, life expectancy, health care, and education in the developing world are all bad things that it is good to reduce.

Re: Maybe Warren Buffett Is Warning Us About Something

#42

Post by sweeneyrod »

digitalsushi wrote: post #2

I have no idea how money works. I have a 401k, it's got more in it than the median 60 year old in the united states, and I'm 20 years from that. And I am terrified of how little I know about how it exists or survives. I read these articles and get a sense of overwhelming urgency that, without any explicit indication, I should do something with my nest egg to make it safer to survive a crash. And then I keep reading,…

If you're 20 years from needing it you don't need to worry about protecting it from a crash since you have time to wait for the market to recover. If you could perfectly predict the seemingly-imminent crash then you'd be better off selling all your shares just before and buying government bonds instead, then reversing that when the stock market hits the bottom.

But since you can't predict it, there's not much point doing anything (you can rebalance a bit from stocks to bonds if it makes you feel better but the impact will be minimal). The growth you'll miss out on from selling too early and buying too late will almost certainly outweigh the benefit.

Re: Maybe Warren Buffett Is Warning Us About Something

#43

Post by maxerickson »

digitalsushi wrote: post #2

I have no idea how money works. I have a 401k, it's got more in it than the median 60 year old in the united states, and I'm 20 years from that. And I am terrified of how little I know about how it exists or survives. I read these articles and get a sense of overwhelming urgency that, without any explicit indication, I should do something with my nest egg to make it safer to survive a crash. And then I keep reading,…

Median investment holdings are ~0, not a real useful benchmark.

Re: Maybe Warren Buffett Is Warning Us About Something

#44

Post by ccffph »

chii wrote: post #30
lethologica wrote: post #7

Earlier quoted context omitted.

Educate yourself. You don't need to know the intricacies of how markets operate, but a little financial understanding is, I believe, a must for everyone. Also, be aware that even when you do educate yourself and you do everything you think is in your power to 'safe guard' your nest egg, that there are are still a billion and one ways that it can all be wiped out tomorrow. Micro managing you're finances if you don't k…

so to sum it up, don't do anything, and hope? Because even if you attempt to educate yourself, it'd be like trying to learn to do your own surgery. Not impossible, but... What i want to really know is what people with a lot of money actually do - and when i say a lot, i meant a lot. networth in excess of 8-9 digits. What do they invest in? What diversification measures do they do? Which country? And finally, how they…

they invest in businesses/franchises to keep a constant cash flow. that and fixed income due to low risk. taxes are avoided by keeping things offshore unless absolutely necessary to tunnel back to the us.

Re: Maybe Warren Buffett Is Warning Us About Something

#45

Post by Frondo »

bungie4 wrote: post #23
chosenbreed37 wrote: post #14

Earlier quoted context omitted.

I'm lost. Could you be more specific about this supposed heist?

Mr. Buffet pledged 80% of estate to the Bill and Melinda Gates Foundation, along with many, many other wealthy people for the betterment of mankind. By all accounts, The Gates Foundation is delivering on their promise by reducing child mortality, womens rights, life expectency, health care and education to the underprivileged of the world. Heist indeed. Sauce: https://www.gatesfoundation.org/

The issue is not that this rich couple is promoting good in the world (nb: I'm not going to nitpick the grammar that others are chuckling over).

The issue is that it might be better for society not to allow people to amass so much wealth, such that society as a whole must then rely on them to pick out issues to try and solve. It might be better if we could solve social problems collectively, through a better system of taxing and directing money to social programs, rather than allow it to bubble up to a few and wait for noblesse oblige to kick in.

I'm looking at other countries, where the inequality isn't so great and the quality of life is better for everyone. Much of western Europe is an example I think we'd do well to follow.

In short: why leave it up to Gates and Buffett to decide what's a good use of what society produces? We could collectively decide we wanted universal health care, free university, and so on, like various other nations have successfully offered for decades.

Re: Maybe Warren Buffett Is Warning Us About Something

#46

Post by hourislate »

Misleading article title....

This was my take away from the article, reads like a hit piece instead of an article on Warren Buffett and his warning. Bloomberg is pulling out all the stops these days...

>Trump’s bonkers G-7 made the world less safe....

>That has all changed in the President Donald Trump era....

>Trump’s erratic behavior before, during and after...

>Another Trumpian chaos agent...

>Trump’s economic-policy anarchy ....

>Trump vs. China vs. Companies....

>One of the more bizarre things Trump said ....

>Trump said he could declare an emergency ....

>Trump ad-libs wild claims...

>While Trump verbally berates his own country’s companies...

>Trump’s trade war will make things much worse...

>Far from the economic basket case Trump would have you think ...

The news these days is a big stinking pile of crap, it's not even news anymore.

Re: Maybe Warren Buffett Is Warning Us About Something

#47

Post by panarky »

mhb wrote: post #18
digitalsushi wrote: post #2

I have no idea how money works. I have a 401k, it's got more in it than the median 60 year old in the united states, and I'm 20 years from that. And I am terrified of how little I know about how it exists or survives. I read these articles and get a sense of overwhelming urgency that, without any explicit indication, I should do something with my nest egg to make it safer to survive a crash. And then I keep reading,…

I recommend reading about the Permanent Portfolio: https://www.investopedia.com/terms/p/permanent-portfolio.asp The permanent portfolio was constructed by Harry Browne to be what he believed would be a safe and profitable portfolio in any economic climate. Using a variation of efficient market indexing, Browne stated that a portfolio equally split between growth stocks, precious metals, government bonds and Treasury…

Asset allocation strategies like this used to work because the components like stocks and bonds were negatively correlated. When stocks crash, bonds gain value and reduce the variation and risk of the portfolio as a whole.

But that doesn't always happen. Sometimes the correlations flip, and everything becomes positively correlated, and everything crashes at the same time.

Today, there's about $20 trillion in the global government bond market that actually has a negative yield, which means the borrower gets paid to borrow.

And in the remainder of the government bond market where rates are still positive, rates are the lowest they've been for 1000 years.

When interest rates are near zero or even negative, it's unclear whether historic correlations will continue, so the concept behind the "permanent portfolio" may not continue to work in this environment.

Re: Maybe Warren Buffett Is Warning Us About Something

#48

Post by sertaco »

digitalsushi wrote: post #2

I have no idea how money works. I have a 401k, it's got more in it than the median 60 year old in the united states, and I'm 20 years from that. And I am terrified of how little I know about how it exists or survives. I read these articles and get a sense of overwhelming urgency that, without any explicit indication, I should do something with my nest egg to make it safer to survive a crash. And then I keep reading,…

This comment received sooo many replies with link references, I cannot help but think that at least half of these are from advertisers. A recent trend on HN...

Re: Maybe Warren Buffett Is Warning Us About Something

#49

Post by panarky »

digitalsushi wrote: post #2

I have no idea how money works. I have a 401k, it's got more in it than the median 60 year old in the united states, and I'm 20 years from that. And I am terrified of how little I know about how it exists or survives. I read these articles and get a sense of overwhelming urgency that, without any explicit indication, I should do something with my nest egg to make it safer to survive a crash. And then I keep reading,…

> I have no idea how money works.

You're not alone in this.

I've found that most people who think they know how money works often just repeat conspiracy theories that don't hold up to critical examination.

While I'm pretty good at spotting bogus theories, I'd be hard-pressed to offer a coherent explanation myself.

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