Investing General Discussion

Complex isn't better. There are a myriad of articles you can point her to that show she should just index and forget it.

Most people assume that it shouldn't be as easy as just investing in the entire market and moving on, that there's gotta be some secret investing sauce that makes you a millionaire. The secret is just not fiddling with shit.

Gravel said:

Complex isn't better. There are a myriad of articles you can point her to that show she should just index and forget it.

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Nancy Pelosi laughs at the returns of index funds.

Pharazon2 said:

Nancy Pelosi laughs at the returns of index funds.

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Yeah man he should just get his wife to run for Senate, how hard can it be?

Gravel said:

Complex isn't better. There are a myriad of articles you can point her to that show she should just index and forget it.

Most people assume that it shouldn't be as easy as just investing in the entire market and moving on, that there's gotta be some secret investing sauce that makes you a millionaire. The secret is just not fiddling with shit.

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I would just note that this has been the absolute best strategy for ~50 years but its not guaranteed to continue as such. Bond bull is over, plenty of reason to assume that SPX will at least keep up with real inflation but its not the no-brainer it has been in recent history. The monetary regime is changing and that is going to change what is "best" and if you just blindly assume the same strategies will work you may end up in trouble. Ask Boomers holding high % of fixed income in their portfolios about "safe" investments.

A lot of moving parts in the financial world right now, if you're low conviction/knowledge on investment choices I would say its not a bad idea to at least hedge a passive SPX style position with some sort of "debasement" holding, Gold/Silver/Bitcoin has a chance to help you stay afloat depending on how things play out. IMO SPX is essentially the US retirement fund at this point so its likely never going to see a protracted fall, because the $$$ printers can't afford that politically, but I wouldn't say its a "good" trade moving forward.

I wish it was easier to give safe advice for investing, but right now everything is fairly risky if you're just going to set it and forget it unfortunately. Happy to have one of our resident experts correct me, but I just can't see the advice that worked 10 years ago (S&P and forget) being as guaranteed as it has been.

EDIT: Adding spoilered. 2025 asset performance. I think we possibly continue to see this sort of thing, setting aside BTC performance as its an entirely different topic. Real assets outperforming financialized assets as our economy shifts focus. Assuming this shift continues and the current regime is successful in their efforts you simply can't continue to act with the same set of assumptions because the entire game board has changed.

Flobee said:

I would just note that this has been the absolute best strategy for ~50 years but its not guaranteed to continue as such. Bond bull is over, plenty of reason to assume that SPX will at least keep up with real inflation but its not the no-brainer it has been in recent history. The monetary regime is changing and that is going to change what is "best" and if you just blindly assume the same strategies will work you may end up in trouble. Ask Boomers holding high % of fixed income in their portfolios about "safe" investments.

A lot of moving parts in the financial world right now, if you're low conviction/knowledge on investment choices I would say its not a bad idea to at least hedge a passive SPX style position with some sort of "debasement" holding, Gold/Silver/Bitcoin has a chance to help you stay afloat depending on how things play out. IMO SPX is essentially the US retirement fund at this point so its likely never going to see a protracted fall, because the $$$ printers can't afford that politically, but I wouldn't say its a "good" trade moving forward.

I wish it was easier to give safe advice for investing, but right now everything is fairly risky if you're just going to set it and forget it unfortunately. Happy to have one of our resident experts correct me, but I just can't see the advice that worked 10 years ago (S&P and forget) being as guaranteed as it has been.

EDIT: Adding spoilered. 2025 asset performance. I think we possibly continue to see this sort of thing, setting aside BTC performance as its an entirely different topic. Real assets outperforming financialized assets as our economy shifts focus. Assuming this shift continues and the current regime is successful in their efforts you simply can't continue to act with the same set of assumptions because the entire game board has changed.

Spoiler

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Nah. It dates all the way back to before the first great depression in the 1880s. Fuck off with your "equities only did well for the last 50 years."

Gravel said:

Nah. It dates all the way back to before the first great depression in the 1880s. Fuck off with your "equities only did well for the last 50 years."

CAGR of the Stock Market: Annualized Returns of the S&P 500

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You need to understand real vs nominal returns sir. You can't look at a chart in USD and apply that unilaterally. It betrays a lack of understanding. I'm not trying to be insulting, its just a lot more complicated than that and with what is shifting in the world it will be even more so. In nominal terms, yes the market will do fine, but in real terms that may not be the case.

At the end of the day though, its your money and you should put it where you want. You just may not fully understand your risk profile

EDIT: grainy picture of SPX/Gold as an example of how this shifts when you change the denominator.

Good thing I live in the US and basically everything I buy is denominated in USD then.

Cad said:

It's just not a winning argument to make that "ackshullay, your returns are pretty bad historically" while they're similar to what they are now and our returns are making us rich despite inflation and currency issues (which are similar to what we've always had).

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I'm not entirely sure I understand your point, so apologies if I'm missing it. What I'm trying to say though isn't "Your returns are bad" they obviously aren't I'm trying to say that because of how the world is shifting financially its not a layup to say you can expect similar behavior in the future and keeping that in mind is a worthwhile thing to do. Advice that has been obviously true in the past will not necessarily remain so in the future due to major shifts we're currently living through. The Boglehead approach of all passive funds and forget may not perform nearly so well over the next couple decades, active management done well probably will.

Cad said:

So something that has never been true in history is going to become true because ... ?

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Because the world is too complicated to blindly dump your money into a big pool and expect it to grow forever? You're going to have to put more effort into your question to justify more effort in a response. By all means disregard me if you'd like, but if you're not tracking the changes Bessent and Trump are cooking up for the monetary regime and how thats likely to shift capital flows you might be in for a surprise if they manage to pull it off. Again I'm not saying the broader market is going to crash and burn or anything stupid like that, I'm just saying it may not perform to the historical norm, in real terms, because the entire monetary framework under girding the current system would be shifting.

Is it really so unreasonable to suggest that asset performance and ideal allocation could change from something like that?

I'm not really looking to drag this thread through a stupid argument. I've said my piece take it or leave it.

Cad said:

You've said your piece but given no reasons other than "things can't continue the way they are, can they????"

History indicates they can. If you want us to believe now is the time everything is changing, say why. Otherwise you're just an instagram reel doomer who is like "subscribe to my channel to learn the real secrets."

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I'm not saying that, I'm not being a doomer at all. You're completely misreading what I've written. Trump and Bessent have both spoken openly about renegotiating the monetary system a "Bretton Woods 2.0" we're watching that happen right now. The "GENIUS" act is part of this which is what Trump is talking when he mentioned modernizing SWIFT. The market structure bill in congress right now that is expected to pass is going to massively deregulate these new rails being built.

Money is going to start moving differently.

Bessent is often talking about pivoting regulations away from Wall Street and toward Main Street. Thats a huge shift in focus for gov $.
Administration has been landing big investments for reshoring manufacturing - thats a massive economic shift coming to us in the near future
Boomers are the historically richest generation in American history - they're retiring. What assets do the own and plan to sell down to pay for retirement? Stonks
AI and Automation are changing how a number of industries operate, this is probably good for stocks but its another unknown for the overall economy.
US is clearly stepping back from role as global power, and shifting to regional/western hemisphere power. Another major shift that will effect economics
US debt is not trusted the same way it has been since WW2.

I could surely continue and even provide sources but I'm not going to. My point isn't that your investments are doomed and you should sell them and buy gold. My point is that your entire career has been under one monetary and economic regime and we're now entering a new one. As such you shouldn't just take for granted that old "good advice" is going to work the same way moving forward. It may very well, in fact I assume they'll do everything in their power to ensure that the stock market stays green in nominal terms, but its not the same kind of layup it has been in recent history.

I'm in no way being a doomer, I'm just pointing out that its not really a great time to bury your head in the sand and assume nothing is going to change as we live through one of the greatest changes in at least a century. None of this is secret most people just don't actually listen to what our leaders are saying and doing, too busy getting distracted by circus acts.

As we prepare for the 2026 year end market poll, it’s interesting seeing the street’s overwhelming bullish narrative.

Average looks to be around 7500 just eyeballing it, which is like 8% up for the year...which is below the average market year of 10%. Looks less bullish in that context to me.