Lender of last resort: your 401k

[jk]

Re: Lender of last resort: your 401k

i take breaks from itulip too but not because i get bullish but you can read the old piece on gold from 2001 and it's all there. nothing's changed. you could have read that, bought gold and fallen asleep like rip van winkle then woke up and, hey! here we are, expensive gold, shit dollar, crappy housing market, and pols jumping from this friggin cess barge economy they built like it was on fire. which is kind of is.

mark faber has written about the 1-trade-per-decade investor: bought gold in the early 70's, sold in 1980 and put it all in japanese equities, sold those on 1/2/90 to put it into the nasdaq, sold that on 1/2/00 to put it into..... what? gold isn't a bad nominee. the idea is that you don't need to trade a lot if you get the main ideas right. the hard [impossible] part would be having the certainty to put all your chips on one bet and then not think about it for 10 years.

[Uncle Jack]

Re: Lender of last resort: your 401k

welcome back uncle jack! didn't we all talk about this last year when we were all wondering out loud about where joe sixpack is going to get $$$ after the home equity well dries up? i think you were the one who said 401ks.

Metalman - Yes, that was me mentioning the 401ks, and not speculating either. I was seeing it first-hand.

JK - Thanks.

Jim - Done.

Speak with you soon.

Uncle Jack

[Jim Nickerson]

Re: Lender of last resort: your 401k

Metalman - Yes, that was me mentioning the 401ks, and not speculating either. I was seeing it first-hand.

JK - Thanks.

Jim - Done.

Speak with you soon.

Uncle Jack

U Jack, almost like Yo, Jack.

Now maybe I can keep tabs on you. Now if we can just get the remaining 190 of the 200 most frequent posters to put up something about themselves, hopefully approaching the truth, then we can tell better who perhaps are the bullshitters and who aren't.

Actually, I too became bullish back on 8/13, a couple of days too soon, then I became bearish again, about a month too soon. Kept right on reading iTulip though, it was one thing that made me a bit more bullish.

[Guest]

Re: Lender of last resort: your 401k

JK -

You wrote :

<< mark faber has written about the 1-trade-per-decade investor: bought gold in the early 70's, sold in 1980 and put it all in japanese equities, sold those on 1/2/90 to put it into the nasdaq, sold that on 1/2/00 to put it into..... what? gold isn't a bad nominee. the idea is that you don't need to trade a lot if you get the main ideas right. the hard [impossible] part would be having the certainty to put all your chips on one bet and then not think about it for 10 years. >>

This is indeed the most elegant and best trade, and I think you are correct that it's weak point is that it relies on the investor's total conviction.

And that then begs the question: As this website also, a few short years ago provided more than ample proof that a trade out of all levered or counterparty backed assets into simple Gold, was a high probability of success trade with a five to ten year time horizon, the fact few if any here have actually followed this revelation with really major positions within their investments, in spite of reading these pages obsessively all year, says a lot about how people translate (or don't) their rationally acquired understanding into actionable convictions. In short, they don't.

I have a strong suspicion after reading here for a year and a half that the tendency among many very well read and scholarly readers of this community is to doubt endlessly about investment themes, and hedge all assumptions.

That in turn begs the question why everyone obsessively reads these pages imagining they are searching for actionable advice. :rolleyes:

I think rather that iTulip's message is far too complex to provide a clear basis for direct investment ideas. Actionable advice can be found in more concentrated form from much more narrowly focused publications. What iTulip provides is understanding of the larger picture, and of complexities in the larger picture which no-one else covers. But it does not seem to me an investment website ... It employs too broad a focus to be that.

[GRG55]

Re: Lender of last resort: your 401k

mark faber has written about the 1-trade-per-decade investor: bought gold in the early 70's, sold in 1980 and put it all in japanese equities, sold those on 1/2/90 to put it into the nasdaq, sold that on 1/2/00 to put it into..... what? gold isn't a bad nominee. the idea is that you don't need to trade a lot if you get the main ideas right. the hard [impossible] part would be having the certainty to put all your chips on one bet and then not think about it for 10 years.

There's similar thesis that whatever asset classes do best in the first part of a decade will do best in the second half of the decade. Gold, commodities, global equity markets would seem to fit that thesis...:cool:

Of course US housing also fits... :eek:

[jk]

Re: Lender of last resort: your 401k

JK -
As this website also, a few short years ago provided more than ample proof that a trade out of all levered or counterparty backed assets into simple Gold, was a high probability of success trade with a five to ten year time horizon, the fact few if any here have actually followed this revelation with really major positions within their investments, in spite of reading these pages obsessively all year, says a lot about how people translate (or don't) their rationally acquired understanding into actionable convictions. In short, they don't.

my own precious metal position has nver been less than about 21-22%, and has been as high as 30%, for the last several years. does that count as "really major positions"?

I have a strong suspicion after reading here for a year and a half that the tendency among many very well read and scholarly readers of this community is to doubt endlessly about investment themes, and hedge all assumptions.

doubting and hedging, yes. but we're still FORCED to do something with any liquid assets we have. even putting it in a bank account is a decision with consequences - notably both currency risk and inflation risk.

for me the itulip discussions help deepen my thinking and inform my decisions. but i have noticed the absence of a model portfolio. :rolleyes:

i wouldn't mind if someone who was properly placed and experienced would start an itulip mutual fund - currencies, pm's, infrastructure and alt energy when the time is right, etc [i gather ej isn't interested in doing this but i imagine he might be available as a consultant, not to mention a copyright payment for the term "itulip."]

[zoog]

Workers warned about 401(k) debit card perils

Some more news on this topic:

WASHINGTON (Reuters) - Consumers should be wary of new 401(k) debit cards that make it easy to swipe away money from a retirement fund, a securities industry regulator said on Thursday.

The Financial Industry Regulatory Authority, a non-governmental agency, said the card is a hybrid of a debit and credit card that charges a fee plus interest for accessing money in a retirement account.


"Regardless of how easy it might be to do, borrowing against your retirement savings should be a last resort and done only in emergency situations," said John Gannon, FINRA senior vice president for investor education.
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"Here you're basically putting another piece of plastic in your wallet to use however you want, even to buy a latte or a pizza," he said. "It might make it awfully enticing for someone who's maxed out their other credit cards."


FINRA, formed last year when NASD and NYSE Regulation merged, issued an investor alert on Thursday about 401(k) debit cards.
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The amount of total borrowing must be approved by a user's employer, and each loan generally must be repaid in five years or less.


Gannon said he believes the main provider of 401(k) debit cards is Reserve Solutions, a unit of asset-management firm The Reserve, which also offers loan processing and automation services for companies managing 401(k) plans. The firm provides a ReservePlus loan card that it describes as similar to a debit card, and Reserve Plus checks.

Look for defaults on 401k loans in the next five years. Which does Wall Street need more, our payments on our mortgages, car loans, etc., or our investments in their should-be-worthless stocks via our retirement plans? We're too broke to do both, tell us which choice to make, oh wise ones.:rolleyes::mad:

[jimmygu3]

Re: Workers warned about 401(k) debit card perils

Some more news on this topic:

Look for defaults on 401k loans in the next five years. Which does Wall Street need more, our payments on our mortgages, car loans, etc., or our investments in their should-be-worthless stocks via our retirement plans? We're too broke to do both, tell us which choice to make, oh wise ones.:rolleyes::mad:

A "default" on a loan taken from one's own 401k results only in the amount due being treated as a disbursement and subjected to a 10% penalty and income tax. Assuming you already spent the money, you'll need to make another witdrawal from the 401k to cover taxes & fees.

I have a family member who burned through a $37k 401k account in the first few months of this year while out of work. Poof.