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Retirement funds do pretty OK here. Early in your career you'll mostly hold something like an S&P 500 index fund or a total stock market fund, as you get close

Retirement funds do pretty OK here. Early in your career you'll mostly hold something like an S&P 500 index fund or a total stock market fund, as you get closer to retirement they shift the allocation towards safer investments. I don't love this; the total stock market is a lot of tech companies, and I already have plenty of exposure to tech by working in the field. It's a good heuristic for most people, though. (And no, I don't do anything about this underlying fear of tech sector exposure. I just buy the Target Date 20XX funds like everyone else.) My only point is that the grandparent comment generally expects companies to die when they get into the S&P 500. If that's true, we're all screwed. If one S&P 500 is just stealing business from some other S&P 500 company, though, it's probably a net gain. But if it's some privately owned startup, then it's not as concrete a win, and let's be honest, startups are driving a lot of the innovation in tech.

JamesianP 4y ago
Which retirement funds are doing ok this time around? They typically switch to bonds which thanks to inflation are down something like 20 percent in the last year (some more like 30), despite yielding far less than stocks in the best of times.
- jrockway 4y ago
  It's the right strategy in general, not a strategy guaranteed to never lose money. Your savings account is down 20% year over year in terms of purchasing power because what $1 is changed dramatically. Rare event, and sometimes you're just screwed. If I had a time machine, I would definitely use it to time the market!
  - JamesianP 4y ago
    People who are retired, and have absolutely no way to bounce back if the market is unkind, should absolutely invest in places that never lose money. I'm not talking about inflation. I can go out and buy actual guaranteed bonds that pay me an actual guaranteed positive interest rate. Yeah they don't keep up with inflation, but it only a small trickle in lost earning power at that point, not a loss of 1/5 of the number of years I can stay retired which the funds are delivering. My savings account is not what I'm talking about. Inflation or not, it is still a number I can describe as "positive". I'm referring to bonds that retirement and wealth management add to funds use to supposedly counter volatility. These are investments that at best will only pay single digits. They have suffered the worst year since 1931 or something. And we're just getting going. The frustrating part is as I said, the underlying bonds themselves still pay that 4% or so which would be much better than the funds are achieving. But for some reason they have to sell the bonds at a loss.

JamesianP 4y ago

Which retirement funds are doing ok this time around? They typically switch to bonds which thanks to inflation are down something like 20 percent in the last year (some more like 30), despite yielding far less than stocks in the best of times.

jrockway 4y ago
It's the right strategy in general, not a strategy guaranteed to never lose money. Your savings account is down 20% year over year in terms of purchasing power because what $1 is changed dramatically. Rare event, and sometimes you're just screwed. If I had a time machine, I would definitely use it to time the market!
- JamesianP 4y ago
  People who are retired, and have absolutely no way to bounce back if the market is unkind, should absolutely invest in places that never lose money. I'm not talking about inflation. I can go out and buy actual guaranteed bonds that pay me an actual guaranteed positive interest rate. Yeah they don't keep up with inflation, but it only a small trickle in lost earning power at that point, not a loss of 1/5 of the number of years I can stay retired which the funds are delivering. My savings account is not what I'm talking about. Inflation or not, it is still a number I can describe as "positive". I'm referring to bonds that retirement and wealth management add to funds use to supposedly counter volatility. These are investments that at best will only pay single digits. They have suffered the worst year since 1931 or something. And we're just getting going. The frustrating part is as I said, the underlying bonds themselves still pay that 4% or so which would be much better than the funds are achieving. But for some reason they have to sell the bonds at a loss.