Japan is the poster child for not putting all your investments in one country, especially at PE =70...No, we know that the worst realized case is less than that (see Japan above), you just choose to be very selective about which historical record you use while also continuously ignoring the fact that the historical records does not represent the actual probability distribution...Would be quite a unique event for the entire global market to have a Japan experience simultaneously ....Now do a Japanese investor in 1989 then explain why that can't happen in the US or even globally... And then explain why someone has to value the additional dollar above the 2.2% as worth more than any possibility of being below it - is there some law of economics that doesn't allow them that utility curve?Maybe one very important point people are missing when considering populating a 20-30 year ladder with a stock index:
Each of those successive 10 years (20+ years from now) is going to have a different result....
So even if you're the unluckiest guy who populated his entire 20-30 year stock ladder in August, 1929, every year except 1949 had a positive result...
And in fact every year, except 1949, significantly out-performed a 2.2% TIPS....
If you want to confirm this for yourself, play with the SP500 returns calculator I posted just a little while ago...
As for the note you're replying to, if I get the energy for it, I might run some numbers for each rung of a stock populated ladder for years 21-30....
We already know that worst case for 20 years is to break-even
Running more 'scenarios' off of it is just digging your head deeper into the sand as you refuse to confront the answers presented to you.
If I had to choose between investing exclusively in one country's stock market (at PE=70) or a 30 yr TIPS at 2.2%, I would choose the TIPS...
Statistics: Posted by CraigTester — Mon Jun 10, 2024 11:58 pm