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What kind of strawman are you building? She did not mention bitcoin once in the article. And what she's saying is something that serious investment analysts hav

What kind of strawman are you building? She did not mention bitcoin once in the article. And what she's saying is something that serious investment analysts have known for years. Most investments don't pan out, at best a passive investor can count on preserving their capital against inflation. Stocks in the USA overperformed but that is a clear survivorship bias as most other stock markets around the world failed to even preserve the capital for the stock owners.

fullshark 2y ago
This isn't the first article of hers I've read, the advice for investment in hard money, or at least putting a significant % of your savings is essentially gold and btc based on previous articles of hers. I understand what she's saying, and I agree with that part of the article, but she's big on the "hard money" portfolio (lately? I think?). The advice to buy index funds is basically "you own a % of all of industry" which is these money printing machines I talk about, and i'm more confident people are going to need industry in 20-40 years than "hard money."
- abraxas 2y ago
  I haven't followed her at all nor read any other articles. I agree with you that stocks should be owned and I own them. But I also don't shy away from gold, commodities or bonds. I believe that diversification is the best route to capital preservation that we have. I make an exception for bitcoin though which I consider utter idiocy.
  - fullshark 2y ago
    I'm too young to worry deeply about capital preservation, but maybe I'll get there. I didn't even get into the fact that our government enacts monetary policies built around ensuring assets (namely stocks and bonds) do not lose value and keep inflating up and the right. I just simply don't see a case for commodities at least at the horizon i'm investing at.
- FabHK 2y ago
  Indeed. This article is fairly good, but a lot of the author's writing is strongly biased towards gold/crypto.
FabHK 2y ago
> at best a passive investor can count on preserving their capital against inflation. That's not true. A) most active funds fair worse than passive funds (as has been shown many times), and similarly, most active traders fair worse than buy-and-hold traders, but more importantly, B) you can hold the full market (more or less) as a passive investor easily, and thus benefit from the few companies that pull the entire index up. Most stocks underperform the bond market, but the stock market as a whole outperforms the bond market.
- throw0101d 2y ago
  > Most stocks underperform the bond market, but the stock market as a whole outperforms the bond market. Most people don't realize how much most stocks suck: > We study long-run shareholder outcomes for over 64,000 global common stocks during the January 1990 to December 2020 period. We document that the majority, 55.2% of U.S. stocks and 57.4% of non-U.S. stocks, underperform one-month U.S. Treasury bills in terms of compound returns over the full sample. Focusing on aggregate shareholder outcomes, we find that the top-performing 2.4% of firms account for all of the $US 75.7 trillion in net global stock market wealth creation from 1990 to December 2020. Outside the US, 1.41% of firms account for the $US 30.7 trillion in net wealth creation. * https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3710251 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3710251 > Four out of every seven common stocks that have appeared in the CRSP database since 1926 have lifetime buy-and-hold returns less than one-month Treasuries. When stated in terms of lifetime dollar wealth creation, the best-performing four percent of listed companies explain the net gain for the entire U.S. stock market since 1926, as other stocks collectively matched Treasury bills. These results highlight the important role of positive skewness in the distribution of individual stock returns, attributable both to skewness in monthly returns and to the effects of compounding. The results help to explain why poorly-diversified active strategies most often underperform market averages. * https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2900447 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2900447 > […] Since 1926, the median ten-year return on individual U.S. stocks relative to the broad equity market is –7.9%, underperforming by 0.82% per year. For stocks that have been among the top 20% performers over the previous five years, the median ten-year market-adjusted return falls to –17.8%, underperforming by 1.94% per year. Since the end of World War II, the median ten-year market-adjusted return of recent winners has been negative for 93% of the time. The case for diversifying concentrated positions in individual stocks, particularly in recent market winners, is even stronger than most investors realize. * https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4541122 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4541122

fullshark 2y ago

This isn't the first article of hers I've read, the advice for investment in hard money, or at least putting a significant % of your savings is essentially gold and btc based on previous articles of hers. I understand what she's saying, and I agree with that part of the article, but she's big on the "hard money" portfolio (lately? I think?). The advice to buy index funds is basically "you own a % of all of industry" which is these money printing machines I talk about, and i'm more confident people are going to need industry in 20-40 years than "hard money."

abraxas 2y ago
I haven't followed her at all nor read any other articles. I agree with you that stocks should be owned and I own them. But I also don't shy away from gold, commodities or bonds. I believe that diversification is the best route to capital preservation that we have. I make an exception for bitcoin though which I consider utter idiocy.
- fullshark 2y ago
  I'm too young to worry deeply about capital preservation, but maybe I'll get there. I didn't even get into the fact that our government enacts monetary policies built around ensuring assets (namely stocks and bonds) do not lose value and keep inflating up and the right. I just simply don't see a case for commodities at least at the horizon i'm investing at.
FabHK 2y ago
Indeed. This article is fairly good, but a lot of the author's writing is strongly biased towards gold/crypto.

FabHK 2y ago

> at best a passive investor can count on preserving their capital against inflation. That's not true. A) most active funds fair worse than passive funds (as has been shown many times), and similarly, most active traders fair worse than buy-and-hold traders, but more importantly, B) you can hold the full market (more or less) as a passive investor easily, and thus benefit from the few companies that pull the entire index up. Most stocks underperform the bond market, but the stock market as a whole outperforms the bond market.

throw0101d 2y ago
> Most stocks underperform the bond market, but the stock market as a whole outperforms the bond market. Most people don't realize how much most stocks suck: > We study long-run shareholder outcomes for over 64,000 global common stocks during the January 1990 to December 2020 period. We document that the majority, 55.2% of U.S. stocks and 57.4% of non-U.S. stocks, underperform one-month U.S. Treasury bills in terms of compound returns over the full sample. Focusing on aggregate shareholder outcomes, we find that the top-performing 2.4% of firms account for all of the $US 75.7 trillion in net global stock market wealth creation from 1990 to December 2020. Outside the US, 1.41% of firms account for the $US 30.7 trillion in net wealth creation. * https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3710251 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3710251 > Four out of every seven common stocks that have appeared in the CRSP database since 1926 have lifetime buy-and-hold returns less than one-month Treasuries. When stated in terms of lifetime dollar wealth creation, the best-performing four percent of listed companies explain the net gain for the entire U.S. stock market since 1926, as other stocks collectively matched Treasury bills. These results highlight the important role of positive skewness in the distribution of individual stock returns, attributable both to skewness in monthly returns and to the effects of compounding. The results help to explain why poorly-diversified active strategies most often underperform market averages. * https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2900447 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2900447 > […] Since 1926, the median ten-year return on individual U.S. stocks relative to the broad equity market is –7.9%, underperforming by 0.82% per year. For stocks that have been among the top 20% performers over the previous five years, the median ten-year market-adjusted return falls to –17.8%, underperforming by 1.94% per year. Since the end of World War II, the median ten-year market-adjusted return of recent winners has been negative for 93% of the time. The case for diversifying concentrated positions in individual stocks, particularly in recent market winners, is even stronger than most investors realize. * https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4541122 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4541122