It's the interpretation of the second amendment by SCOTUS that has been inconsistent over time, not the ACLU's position. Collective/militia rights is a widespread interpretation of the second amendment (which the ACLU holds). Interpreting "right to bear arms" as unrestrained individual gun ownership is not the default position just because modern NRA advocacy says it is.
This isn't responsive to Rayiner's point. "Why" the ACLU doesn't expansively support the right to bear arms the way they do speech and freedom from search is interesting, but doesn't rebut Rayiner's point "that" they don't.
The alternative to prosecutorial discretion is 100% enforcement of all crimes big and small. In either situation, the government would go after these people for their small crimes so the outcome for the targets you're mentioning is the same. Also, Capone was convicted by a jury on evading (in 2019 dollars) millions in taxes, so 'small' is relative only to massive corruption scheme and murdering he wasn't convicted on.
Or, once a bunch of elites go to jail, the laws get changed so that only serious crimes are indeed 'crimes' and the rest get civil penalties in proportion to the means of the offender.
If US drug convictions against the rabble, versus the elite and well-connected (or even just black vs white) are any indication, you would get penalties inversely proportionate to the means of the offender.
Ah, that explains it. Thank you for digging that up.
I've worn my best a couple of times in the last few months, it's been enough with the Grim Reaper for a while for me, so I'm not too easily amused by the subject.
re: Scalise Shooting: In a statement, Senator Sanders wrote that he had been “informed that the alleged shooter at the Republican baseball practice is someone who apparently volunteered on my presidential campaign.” He went on to say: “I am sickened by this despicable act. Let me be as clear as I can be. Violence of any kind is unacceptable in our society and I condemn this action in the strongest possible terms.”
https://www.theatlantic.com/politics/archive/2017/06/scalise...
That's my 5 minutes of doing your research for you. High ranking Democrat politicians don't tolerate heckler's veto, much less violence. Republicans are so cowed by losing support from their radicals that they can barely bring themselves to speak up against them. Charlottesville is notable in that its pretty much just Trump who failed to speak up.
1. The statement (politico) you refer to was made 5 days after the incident, in a private meeting, Obama said it was "hate crime", did not use the word "racist", did not mention they were BLM sympathizers.
2. Obama did speak up just one day after the events [1], but he did not specifically mention BLM in particular, claiming lack of confirmed info (justifiably so)
Trump immediately spoke up, but did not mention white supremacists, drawing huge criticism.
I am far from a Trump enthusiast, but can you not see double standard applied here?
If you're interested in an alternative to the traditional suggestions, I'd suggest the derivative-trading approach you can find espoused at tastytrade.com. It's not for those who don't want to learn and engage though.
Anonymous downvotes not withstanding, I'm interested in comments from anyone informed on the subject who's critical of the approach I mentioned. I don't find much discussion on the subject in forums.
I'm pretty sure I replied to you last time ;) One important aspect of looking at returns is comparing different strategies, but another one is in realistic planning. There's a lot of literature and marketing out there touting, in my view, grossly unrealistic numbers like 7-8% annualized compound returns as a reasonable expectation for sticking your money in an index fun on the S&P. Considering the huge differences in the effect of small changes to the annualized returns, it's important people have a realistic idea of the volatility in that expected number when they allocate the amount of money they save for the kind of retirement they want.
This graphic is awesome primarily because it shows that it is not correct to assume that volatility in the equity markets is averaged out completely during a timespan that is comparable to the average savings portion of a career.
Thank you for the reply again :). I saw your comment previously and I think you make a great point. As much as I criticize the chart for being unfairly pessimistic about equity returns, there is far too much literature suggesting you can get 7-8% real returns by parking your money in X, especially in the <20 year time frame for stocks. In comparison this chart is a good factual dose.
My concern is, that while this comparison is useful for people further along in their research trying to understand the volatility of the stock market, this chart has a number of misleading (IMO) traits that can dangerously/unfairly steer people who are newer to managing their own money away from index funds altogether.
I would hope that people see this chart, my comment, yours, and FabHK's excellent comparison to bond yields. But if you have limited attention and are getting started, I would hate for the original link to be the only thing you see.
Speaking for experience with family and friends, too many good people scared by charts like this bought gold in 2011 or trusted mutual fund managers to buy into funds with 4% front-end loads and 2% AUM fees.
It's funny because I agree with all those statements and add "people will listen to Jeff Siegel and just jam their money into index funds and close their eyes until its time to retire". So they lose coming and going (but lose less relying on index funds than buying gold funds).
Personally I think actively managing your money is the better solution, but the active desire not to manage money from so many people (even otherwise active and engaged people like the HN crowd) has led me to being in favor of a stronger govt-backed pension system rather than tax-deferred accounts that hurt our tax base and are a windfall for trustees.
> Personally I think actively managing your money is the better solution...
To what degree do you believe people should actively manage their money? Are you advocating that people should be more active in choosing their distribution of assets across risk:reward categories, or are you advocating for more active trading?
I think the short answer to your question is "both". You need a portfolio with diversified product risk and diversified strategies. You don't need to be a quant to make a basic stab at this with the typical retail portfolio size, there are tons of tools for free on the internet to do this kind of thing. Most people who know enough to not be in managed funds still have no idea how to have anything but basically a 100% long equity market portfolio (I'm intentionally grouping together mostly meaningless 'diversification' between highly correlated segments like midcap/largecap/nasdaq/dow) except to make it long bonds. So I think there's basic product and strategy knowhow to organizing and maintaining a portfolio.
The reason I said both is because of the 'maintaining' part. Without some level of activity, its effectively impossible to be engaged with the market enough to take advantage of opportunities and manage your portfolio to keep enough diversification and reduce the internal correlations in your holdings/strategies.
It might sound complicated but it can be learned and it isn't rocket science, and there is a lot of great technology to assist anyone, not just software devs. Managing your life savings is a better investment of time than many other pursuits, in my view.
Sounds good in principle but how well does advice like this scale? Similar problem to Waze - side streets are great when you're the only one taking them, but once everyone does your advantage is gone. It's hard to expect a large population of amateur investors with no edge to outperform the market. In the general case, what's the marginal return on time and effort spent actively managing your money vs dumping it in a vanguard 50 and learning a different hobby?
That's possible, but it isn't currently the case. At a minimum, having a long vanguard 500 position has a roughly 50% + positive drift - fees chance of success. Part of the long vanguard 500 price bakes in the unlimited theoretical upside that comes along with it. Selling option contracts against that long position to give up that upside beyond a certain price reduces your cost basis and pushes your position's success rate over 50%. Repeated over many events creates a net positive expected value.
Even if there was no edge in the market, as in your premise, it's still the case that the upside of a long S&P 500 equity position is unlimited, and the upside of a long S&P 500 equity position with an option sold against it is limited, therefore would be priced to have a superior chance of success relatively speaking. More market participants would improve the price accuracy of risk, it wouldn't reduce the price of risk to zero.
As for whether its worth it, I think the aggregate effect is significant and, of course, is subject to the benefits of compounded returns, so it doesn't take much to severely outperform your other prospects in the long term. It's up to each of us to decide if its worth learning.
I don't know about every buy-write index investments, but BXM specifically is done with essentially ATM (technically the very first strike OTM I believe) calls against the long position, then held to expiration and cash settled. In a long bull market like the present day, this approach will always underperform the market while having reduced volatility. It should overperform the market in down or sideways markets. Also, volatility induces drag so in a compounded return, all else being equal, lower volatility will yield higher returns.
Diversifying amongst uncorrelated products is an important missing feature to this strategy for the purposes of reducing volatility. If only considering writing covered calls/puts, I'd personally prefer to reduce volatility through diversification, and sell further OTM options to reduce basis so I keep more of the directional risk in each individual position and have lower transactional costs.
Also, BMX holds contracts to expiration rather than benefit from cyclicality in price and implied volatility by closing/rolling options early when they move in your favor or scaling into positions during volatility expansions.
it sounds like you're basically advocating something like an s&p 500 buy-write index investment instead of just an s&p index investment, right? basically selling covered calls on your index investment.
I agree with your premise, and make a pleasant bit of side-income selling covered calls on individual stocks that I own, but it seems like the buy-write indices don't actually fare well, or at least $BXM doesn't. Way worse than I would have expected actually...any idea why?
that's a good point -- i suspect the s&p 500 receives so much attention in comparison to any particular individual stock that there is very probably little change to fish out of its couch cushions
The average person likely doesn't have the time, energy or interest to go beyond the absolute basics of investing which is why simplified advice such as that on Bogleheads is popular.
For those wanting to go a step beyond but still lacking time to go deep, where would you recommend starting education wise? Any links or a syllabus with links would be super useful.
Sure, the guys at tastytrade.com put a ton of effort into educating people and providing a platform (dough.com) that provides this information. I think it has some organizational issues, but my way to start would be to start with the 'Where Do I Start' series they have.
In short, that site largely revolves around the fundamental premises of a random-walk view of prices, and using the time-decay of selling options to reduce the cost basis of holdings over time. There's a lot of treatment and research on correlation of different assets (equities, different kinds of commodities, currencies). My advice if you follow this is to start small and stay actively engaged without getting over-confident at early success. There is a lot of getting used to the mechanics and learning the products so that you can make it a manageable part of your life, time-wise. Also you need to make sure you properly understand the relevant notional values you're dealing with so you can do proper sizing.
BTW quick answer to your first question, here's a sample basket of lesser-correlated assets that the typical index funds that all boil down to being long the market. One of the cores of having a random-walk view of things is that the choice of direction (long/short) is less important than the strategy & cost basis reduction (all of these have liquid option markets):
Long S&P (/ES or SPY)
Long Gold (/GC or GLD)
Short Bonds (/ZB or TLT)
Short WTI Oil (/CL or USO)
Long Euro/USD (/6E or FXE)
Thanks! I'm not sure how shorting bonds/oil is like being long the market? I've always been under the impression that going long had an upward bias, and buying options had a downward bias (but maybe selling them gives some upward bias), so that playing with options was a bit like playing at a casino, where the odds are biased in the favor of the house.
I'm not saying shorting bonds/oil is like being long the market. I just picked a set of underlying assets that are much less correlated than e.g. S&P & Nasdaq. The directional choice (long/short) is really a choice of the investor. Correlations between products are not stable over time, so picking one vs the other is similar to a price bet (i.e. normally distributed). The main point is that the underlying assets are not highly correlated, and that they have liquid derivatives markets that can be used to reduce cost basis.
You may or may not make money on your directional choices, but the core strategy is to be short option premium to make your expected value positive, and to have low internal correlation amongst your assets to reduce volatility in your portfolio.
I'm not 100% sure I understand what you're trying to say re: upward bias/downward bias. However, buying options do have a negative expected value so I agree about that. Selling options is the strategy, and conceptually is similar to selling insurance. Limited profitability, positive expected value. Just like an insurance company, you keep your risk diversified to reduce volatility and keep positions small enough to prevent busting out during drawdowns.
I'm not suggesting buying options (except as part of a spread)
Bonds are a horrific investment in today's market. Rates are lower than they have been since WW2 when they were fixed by the government! The principal and interest risk for owning bonds is essentially at an all time high. You'd literally be better off in cash in rates rise even somewhat in the near future.
what makes you think this wouldn't be priced into bond yields? There is trillions of paper in the market, an arbitrage is eaten by the entities who make their living doing it. There is no secret edge.
To be clear, there is a price for the bond, which is the amount you pay for it. For EE bonds, you pay what you choose, and earn the Treasury-specified rate on that amount. However, this amounts to being priced just like other bonds. If you read the Treasury website, you'll find that they specifically state that the rate for newly purchased bonds is set based on current market conditions (today 0.1%). This balance between principal and interest is why people use terms like 'yield' to accurately describe bonds. An EE bond is no different (because there really is no edge), and if you make any more on it (not much), it's because you're giving up the liquidity of a transferrable bond.
Are you reading what you're replying to? Series EE bonds are guaranteed to double your investment, a return of ~3.5%, if held for 20 years.
If you hold for 19 years, they are, as you point out, a terrible investment. But the 20 year yield is decent, for a low risk product, in today's market.
I feel like I'm taking crazy pills. I said you make a rate based on the market return (as stated on the treasury site). I also said the additional return you get is based on having it be non-transferrable, and in the case of the annualized 3.5%, 20-year term, severely illiquid asset. That's also true. I think the risk of illiquidity is major risk, and I don't at all agree they are decent investments for that reason. I realize this is a zombie thread but can't help but reply. Just because there are other, also terrible, low risk debt products in today's market doesn't make this one reasonable. The value of an investment has to be measured based on what you're getting out of it, not just relative to other investments. That's why I remarked on being better to be in cash than bonds: bonds have a huge actualized and opportunity risk relative to their yield.
I feel this graphic, while informative and delightful, is insidious in its choice of scale and its lack of comparisons.
On scale, it makes it seem like +3% to +7% real returns is "neutral". This makes it seem like the stock market is sometimes good sometimes bad but overall it may as well be just okay.
On comparisons, it does a huge disservice by not adding a tab showing bond yields and a tab showing cash/treasury yields (which would be dark red across the board except light red around 1930).
I feel these slights make the graphic present stock investing in an unfairly unfavorable light and makes the suboptimal strategy of keeping your money out of the market seem much more favorable than it is.
The graphic isn't presented to compare stocks with the alternatives of cash/bond yields. I think the major service done here is setting a realistic expectation for the returns you might see in your lifetime. It's especially relevant for people who's major investing periods have/will occur in the 2000-2020 timeframe of sluggish growth and ultra-low yield. The Jeremy Siegel '8%' number is a really dangerous number to set your expectations on when saving. If you do, you might be 20 years in and well outside the bounds of a timeframe where compound interest can help you live the retirement you were aiming for before you realize your mistake.
This single diagram explains the market dynamic year over year in a way I've never seen anywhere else. The 1/3/5/10 yr returns figures you see don't even come close to understanding the nuances of one year over another.
I remember when this diagram was published in 2011 and _still_ refer to it routinely.
This is why you do dollar cost averaging and steadily invest every year, to spread out your investments over multiple years.
I'm glad you like it but I don't follow how you infer dollar cost averaging from this. There's no statistical advantage to dollar cost averaging over lump sum investing (actually the opposite due to the median return beating inflation). I'd argue the main benefit is a realistic expectation and understanding of the range of returns to help you plan better.
Dollar cost averaging doesn't have a better expected value than lump sum investing, but it should have a lower variance, no?
Also, there's dollar cost averaging like "I have a lump sum now, but I will invest it slowly over the next 2 years" and there is dollar cost averaging like "I will invest money as it comes in slowly over the next 2 years instead of saving it up and investing it as a lump sum then". The former is the technical definition, but the latter is what most people mean when they use the term informally...
As with all trustee-run plans, people should evaluate the investment options before moving the money in. The HSA I personally have access to is great for saving taxes on expenses, but if I wanted to use the investment options rather than sit in cash, my only options are high-fee managed funds (there's a lot less pressure on these vendors than on 401k trustees due to less public awareness)
Like an IRA, you're free to open an HSA with another provider and transfer the balance. You get the deduction from your employer and can invest in lower-fee funds. The best options are still relatively expensive compared to the IRA/401(k) scene, unfortunately.
