Earlier quoted context omitted.
But we live in the best of all possible worlds!
Don't be so Candid
I thought it was Chumscrubber.
Investing Returns on the S&P500
311–320 of 357 posts
Re: Investing Returns on the S&P500
#312Earlier quoted context omitted.
That depends on how you generate it. When apple builds wealth, not zero sum; when a hedge fund builds wealth; zero sum. 40% of our economy is financial services now, there's a lot of zero sum wealth creation going on.
Even hedge funds aren't zero sum. They receive dividends on the investments they hold which is a return that is not zero sum. Of course, the more active a fund is, the farther it gets from zero sum, but it would never be fully zero sum. Additionally, financial services overall are far from zero sum. There is a great deal of efficiency and market lubrication created by financial services and if you exclude the high fr…
> Even hedge funds aren't zero sum. They receive dividends on the investments they hold which is a return that is not zero sum.
Once again, that depends on the trade, short term trades don't make their money from dividends, but from timing the market.
> Additionally, financial services overall are far from zero sum.
Beside the point, plenty of them are zero-sum-never said they were all zero-sum; that exception exist doesn't change the point that zero-sum vs non-zero-sum is a false dichotomy, the real world is both zero-sum and non-zero-sum, depending on the way the wealth is being generated. It's tiresome watching people continually repeat the incorrect mantra that wealth isn't a zero-sum game when quite often, it is.
Re: Investing Returns on the S&P500
#313Earlier quoted context omitted.
With an increase in immigration and a cheapening of robotic workers and kiosks... where is this decrease in unemployment and increase in labor-force participation going to come from? I mean, there is "always" going to be jobs for plumbers and spots for artisan made stuff... but those jobs aren't going to replace the amount of jobs that will be lost when $15 becomes more expensive than iRobot...
A UBI, supplied taxafion, and significant deregulation would enable citizens to participate in the economy on much more liberal terms and you would almost always see participation rates rise while total hours worked fall.
simplified taxation*. Yay autocorrect on mobile from hours ago.
Re: Investing Returns on the S&P500
#314Looking at the discussions here I find it interesting that even in something as number driven as the stock market everybody argues about the meaning and the validity of the numbers. There really is no clear picture. But somehow the regular guy is supposed to navigate his way through this jungle of conflicting, confusing or meaningless numbers. And considering the long time frames most people don't have much opportuni…
That is basically the argument for managed pensions, fiduciary managed retirement accounts, etc
Re: Investing Returns on the S&P500
#315Earlier quoted context omitted.
> That remains to be seen What would a more powerful USA look like? It doesn't appear that the country is after an empire the same way the British had one 100 years ago, so raw aggression is out. I can't imagine a realistic scenario that doesn't require the implosion of other nations to embiggen America.
The USA is at 'peak' , we can roughly say this, not because of anything America is doing, but because the 'rest of the world' is coming online. 50 years ago there was 'America', the 'Soviets' and 'Europe'. Everything else was a footnote. What we've seen with China 'coming out of nowhere' in the last 25 years is about to happen 4x with the rest of the world. America and Europe's share of global economy is falling fast…
> I don't see the emergence of any new 'superpower' and America will likely remain the only 'superpower' in the classical sense, but it won't be as powerful as it is today - relatively speaking.
Maybe. But the trend towards privatising military force could end up accelerating USA's slide down in terms of military power. If we are indeed moving back to the "normal" (historically speaking) "neo medieval" world were military force is generally mercenary and not national standing armies - coupled with the commodization of advanced military technology - the world could radically change quite quickly.
Maybe the USA won't be able to pay its contractors - and China and/or Russia can? Maybe China will restructure the PLA as the world's biggest military contractor?
I don't really think you are wrong - but it can be tricky to predict the future. Perhaps especially the sudden stumbles we seem to make every so often as a species back into new dark ages and decent into chaos.
Re: Investing Returns on the S&P500
#316Earlier quoted context omitted.
I'm interested in walking the quant path. Just how high is the bar? And would there be an equivalent project that would put a prospective quant to the top of the resume pile?
I've attached two pdf's on what you should expect. The latter was the take home an old company used to give quants as a test. If you can answer the questions on teh practicum then you probably have enough math skills to start as a quant. https://drive.google.com/folderview?id=0B1iikX5PwNx4d2dKQ3FT...
Remind me
Re: Investing Returns on the S&P500
#317Earlier quoted context omitted.
Couldn't you have made this same point at most times in modern American history? Wasn't it possible that the US was at its peak in 1970? Or 1980? Or 1990? I suspect it is only due to hindsight that we know it wasn't the peak then.
Yes, that's true. I'm not saying that the US is necessarily at its peak, just pointing out the fundamental problem with extrapolating based on historical data. It assumes that the future will look like the past, even though there are some plausible reasons to think that it won't. Some of those reasons would push you harder in the direction of investing in stocks (e.g. increasing automation, globalization) and some wo…
Actually, that isn't quite right. All the negatives you mention should push you away from investing in stocks only if you think that other investment options under those scenarios would do better. But why would they ?
Re: Investing Returns on the S&P500
#318Earlier quoted context omitted.
I think they're referring to the fact that the Russian stock market collapsed completely (i.e. total loss) in the beginning of the 20th century.
Clearly. But they were considering investment strategies (buy&hold vs alternatives). My point was that few if any investment policies would hedge you against market extinction events.
I would probably have preferred to own real-estate in Russia... Although If we look back to before ww2, probably not...
Re: Investing Returns on the S&P500
#319This is great analysis. Keeping in mind there's more motivation to do this kind of analysis during euphoria phase of the stock market than during capitulation phase of the stock market like in 2009 or 2010, I think this shows investing in the long term will cancel out losses in the short term.
Re: Investing Returns on the S&P500
#320Earlier quoted context omitted.
I'd appreciate if you could expand on that, because I share the same concern as GP. It seems to me that the index fund has to sell a lousy company at a low price (since it's being delisted) and buy a strong one that's being included in the index. Whereas the index, being just a number, can magically perform the swap without taking a hit.
The index "magically performs the swap" doing a calculation equivalent to selling at the rebalancing date the stocks that get out of the index (and buying those that replace them) at their price that day.
Oh, that makes sense. Do you have any reference for it? I found this explanation http://www.investopedia.com/ask/answers/040215/what-does-sp-..., but it doesn't seem all that trustworthy, and it seems to suggest that S&P doesn't account for survivor bias.