KEY TAKEAWAYS
-Innovation and disruptive change continue to benefit a relatively small group of mega-
cap companies. Despite recent gains, valuations for these stocks still appear reasonable.
Technologies such as electric vehicles and autonomous driving suggest that the transportation industries could be next in line for rapid transformation
-For the first time since the global financial crisis, the world economy is in a synchronized
expansion, driving steady earnings growth in most markets.
Among developed equity markets, Europe and Japan appear more attractive than the U.S. based on improving economic fundamentals, diminished political risk, and potential upside for corporate earnings. Valuations are also modestly cheaper in Europe compared with the U.S.
-Barring unpredictable political or economic shocks, the global earnings recovery should
continue in 2018. However, year-over-year comparisons will grow more challenging.
-Whether recent low market volatility persists in 2018 remains to be seen, but we do not
believe low volatility in itself predicts that a significant correction is imminent

link to report:
2018 Global Market Outlook

Just a guess, but in the context of retirement, FRA could easily stand for Full Retirement Age (currently 66 - see SSA).
Trump just appointed Alex Azar, former head of Eli Lilly's US division as HHS Secretary. One of his first tasks was to accept the resignation of CDC Director Brenda Fitzgerald due to investment conflicts of interest, who was appointed by former HHS Secretary Tom Price, who resigned after spending over $1/2 M on private charter flights (or was it his investments in health care companies).
Trump seems too busy repopulating the swamp to do anything about drug prices. The stock market seems to agree:

When then-President-elect Donald Trump said pharma was "getting away with murder" one year ago and pledged to lower prices, share prices quickly plummeted. ... But this time, despite the familiar words, the president's comments didn't touch off nearly the same reaction on Wall Street, signaling that industry and investors may be more skeptical about the threat of pricing reform.

https://www.fiercepharma.com/pharma/as-azar-sworn-trump-pledges-hhs-secretary-will-get-prices-way-down

"Morgan Stanley last year decided to ban its financial advisers from selling clients new positions in Vanguard mutual funds, the Journal reported. Merrill Lynch has long had such a policy for its advisers."
Way to put your clients' interests first.

I already own I class shares of many Pimco funds (PIMIX, PIGIX, PFORX, PSTIX). I was only stating that PiMco is increasing fees and possibly leaving the small investor behind with the elimination / consolidation of the D class shares and the limited availability of load waived A class shares. Having widely available D class shares in a fund supermarket at numerious brokers is beneficial to small investors (its more likely they would be offered at their broker). Small investors may not have the financial ability to open multiple brokerage accounts. You obviously don’t agree...

FYI: (This is a follow-up article.)
Wall Street is fighting back against Vanguard Group. Large financial firms including Fidelity Investments, TD Ameritrade and Morgan Stanley have all made changes to their fees or product lineups that make it more expensive for some customers to invest in Vanguard’s funds.
Regards,
Ted
http://www.cetusnews.com/business/Wall-Street-to-Vanguard--We’re-Not-Your-Doormat-Anymore-.HyYkGFoHf.html

FYI: Lawmakers in Illinois are so desperate to shore up the state’s massively underfunded retirement system that they’re willing to entertain an eye-popping wager: Borrowing $107 billion and letting it ride in the financial markets.
The legislature’s personnel and pensions committee plans to meet on Jan. 30 to hear more about a proposal advanced by the State Universities Annuitants Association, according to Representative Robert Martwick. The group wants Illinois to issue the bonds this year to get its retirement system nearly fully funded, assuming that the state can make more on its investments than it will pay in interest.
Regards,
Ted
https://www.bloomberg.com/news/articles/2018-01-26/illinois-ponders-pension-fund-moonshot-a-107-billion-bond-sale?srnd=fixedincome

Hate to be missing the Trump bump, but Cinnamond isn't buying, so far as I can tell. (My legacy accounts have enough for the next ten years.) RBS is finally doing well, and I think TEVA will work out. GE will probably work out over a few years, so will average down. Bought some Vanguard Overseas a few months back when my university restricted my options (possibly a good idea, since it's cheaper), although I think I'd be several thousand ahead now otherwise with my previous Fido investment (mostly overseas), but I never know when to sell. Riding VPMAX and VHCAX (adding the yearly minimums) plus VGHAX for the next decade, and moving money from my TDA account into them at the allowable rate. (In hopes that there won't be enough money left when my dementia becomes obvious [strong family history]) for any financial harm to be done.
Will be living on SSI and RMDs from 2019 on, so good ideas are appreciated. (I've really benefited from some, so this is not an idle comment.)

I'm actually in agreement with davidmoran. How about taking the money already invested in SSN and invest it. The accounts would actually belong to the investors. When they die, the money should go to their descendants (SSN account). Upon Retirement, send a monthly check (no lump sum, no borrowing). I would also make financial literacy a required course. The portfolio could be 100% in equities until a certain age and then tapered off as the Investor ages. No Annuities.

https://www.sec.gov/Archives/edgar/data/872323/000110465918004132/a18-3299_12497k.htm
I also received an email from Oakmark indicating the same.
Excerpt from email:
The Oakmark International Fund will close to new investors at most third-party intermediaries effective 1/26/18.
Excerpt from SEC filing:
PURCHASE AND SALE OF FUND SHARES
Shares of the Fund may be purchased and sold (redeemed) on any business day, normally any day when the New York Stock Exchange is open for regular trading. Such purchases and redemptions can be made through a broker-dealer or other financial intermediary, or directly with the Fund by writing to The Oakmark Funds at P.O. Box 219558 Kansas City, MO 64121-9558, or accessing our website (Oakmark.com). You may pay brokerage commissions on your purchases and sales of Institutional Class shares, which are not described in this prospectus.
The Fund is closed to most new investors as of the close of business on January 26, 2018. See "ELIGIBILITY TO BUY SHARES" in the Fund's prospectus for account eligibility criteria.

FYI: There are a number of budding ETFs beginning to peak over the horizon and bidding for the attention of asset managers and financial advisors.
Twelve of them were featured in a rapid-fire presentation at the Inside ETFs Conference in Hollywood, Fla. on Tuesday.
Regards,
Ted
https://www.fa-mag.com/news/hidden-etf-gems-36799.html?print

FYI: Bridgewater’s Ray Dalio thinks that the stock market could see another surge and investors in cash will be left out.
Sitting on the sidelines holding on to cash as the stock market heads to fresh records? Then you may be making a big financial mistake.
Regards,
Ted
https://www.marketwatch.com/story/head-of-worlds-largest-hedge-fund-says-if-youre-holding-cash-youre-going-to-feel-pretty-stupid-2018-01-23/print

"However, SEC mandated reforms were implemented at the time which further restrict the type of investments the retail funds can make. Many (most?) became government-backed money market funds. These changes made the retail funds much less profitable."
Brokerages and mutual fund companies seem to have done their best to confuse matters. They certainly made it appear as though people were being forced to accept lower returns.
If you were already investing in a US Treasury fund (e.g. PRTXX) or a US government fund (T. Rowe Price did not have one), nothing changed. If you were invested in a prime fund (i.e. one that could invest in corporate paper and other non-US government securities), things may have changed.
Financial institutions were reluctant (perhaps prohibited, I'm not sure) to allow you to use a fund that could freeze redemptions as your core/transaction/checking account. So they had two choices - convert their "core" fund offerings from prime to government, or require you to pick a different fund (a government fund) as your core account. They went with door number 1.
TRP changed Prime Reserve to Government MM (PRRXX), Fidelity changed Cash Reserves to Government Cash Reserves (FDRXX), etc. But T. Rowe Price also did something else. It took its high minimum (higher yielding) retail prime fund, Summit Cash Reserves, lowered its min to $2500 (dropping the "Summit" high min part), and renamed it Cash Reserves (TSCXX). So one still had a prime fund available; arguably a better one than Prime Reserve.
Here's T. Rowe Price's description of the changes required and what it did:
https://www4.troweprice.com/mmr/content/dam/money-market/articles/MMF Reform_US_04-12-2016_Update_v2.pdf
TSCXX wasn't forced to change anything. Here are the portfolio compositions as given in the April 2014 and October 2017 reports.

   Security Type     2014    2017
Commercial Paper      53%     52%
Muni Obligations      28%     23%
Foreign CDs (USD)      7%      5%
Treasury Notes         6%      9%
Domestic CDs           5%      3%
US Treasury Bills      1%      4%
Other (net)            0%      4%

- Are we going to legislate oversight and regulation of the nation’s financial institutions?
- You don’t suppose this might than become a political football every election season?
- If Vanguard, Fidelity and BlackRock were to contribute more to the campaigns of these Congressional financial gurus, might it might alter their thinking?
-
I tend to agree with the “float”. If you need a stable value on your cash investments, there are other options like FDIC insured bank accounts or T-Bills. As msf says, the floating rate doesn’t apply to the funds marketed to small retail investors (most of us). However, SEC mandated reforms were implemented at the time which further restrict the type of investments the retail funds can make. Many (most?) became government-backed money market funds. These changes made the retail funds much less profitable. That was enough to convince me to move to TRBUX.
If you could go back and view the old FA board discussions for fall / winter of ‘07, you’d find a number of threads questioning whether money market funds were “too risky” for small retail investors (most of us) - quite the opposite of a climate where discussions about emerging markets, junk bonds, and various passive approaches to equities dominate.

Here's a four page primer from Vanguard on the MMF rules, including background on why something like these rules is needed. It's dated 2014, before the rules became effective (late 2016).
https://personal.vanguard.com/pdf/VGMMR.pdf
The final paragraph begins: "We believe that these changes, along with the safeguards implemented in 2010, constitute a strong response to concerns that institutional money market funds may pose a risk to the financial system. While the majority of Vanguard money market fund shareholders won’t be affected by the new rules, some institutional
clients will be."
Remember that only institutional prime and muni MMFs float. Yours and mine don't.

FYI: The House Financial Services Committee has advanced a bill that would eliminate some of the strictures placed on the $2.8 trillion money market mutual fund industry in the wake of the financial crisis.
The legislation, which was opposed by Fidelity Investments, Vanguard Group., BlackRock Inc. and other major asset managers, would repeal a 2014 requirement that the riskiest funds allow their share prices to float, rather than maintain a stable $1 value. The panel’s action clears the way for a House vote on the measure.
Regards,
Ted
https://www.bloomberg.com/news/articles/2018-01-18/house-panel-backs-bill-to-scrap-floating-prices-for-money-funds

FYI: Although I don’t spend a ton of time watching the financial news, I see more than enough of the misinformation that too many people seem to regard as factual.
Last week I was appalled (though not totally surprised) to see a commentator describe 2018 as likely to be “a stock picker’s year.”
This is the stupidest sales pitch for active management that I know. And I don’t think “stupid” is too strong a word.
The idea seemed to be that there’s something special about this coming year that will give active managers an advantage over index funds.
Regards,
Ted
https://www.marketwatch.com/story/dont-be-fooled-stock-picking-is-still-a-losers-game-2018-01-17/print

FYI: Holding mutual funds feet to the fire when it comes to excessive fees could get a good deal more difficult if legislation is approved by the House Financial Services Committee this week making it tougher for consumers to sue, the Consumer Federation of America (CFA) said in a letter sent to lawmakers this week.
The CFA is asking House Financial Services Committee Chairman Jeb Hensarling (R-TX) and committee members to vote “no” on “The Mutual Fund Litigation Reform Act (HR 4738),” which would increase the burden of proof required by investors suing a mutual fund company for excessive fees. The bill is scheduled for committee markup this week.
Regards,
Ted
https://www.fa-mag.com/news/cfa-urges--no--vote-on-bill-limiting-investor-right-to-sue-mutual-funds-for-excessive-fees-36668.html?print

As it should have. He was talking about stocks, and there's a big difference between being a customer of a company and knowing a company. It's the latter sense in which he meant one should know what (company) one is investing in.
Still, when it comes to industries, knowing means something different. Working in an industry can give you a good sense of the health of that industry if you are attentive.
I was wondering whether you had any thoughts about how the CAPE index model will be adjusted for the new sector since this is a thread about DSENX. When real estate was carved out of financials, the CAPE index was modified to use a non-SPDR index fund, IYR.
I imagine that was done because it needed an index fund with a ten year history, and by definition, XLRE was a new fund without a history. Though IYR might have been chosen because it was more inclusive, holding mortgage REITS such as NLY that XLRE excludes.
However, that might mean that the CAPE index added a new group of companies (mortgage REITs) that it had not tracked before. A discontinuity. Regardless, another imprecision arose - the old history of the financial sector included real estate, while the sector itself no longer did. Was any attempt made to correct for this (e.g. recalculating the financial index history after pulling out the real estate component)?
This time things are even more interesting. The CAPE index tracks XLK for technology, but XLK combines technology and telecom. That's why there are ten "sectors" that the CAPE index uses, while there are eleven S&P sectors.
It is possible that State Street will decide to keep XLK as it is, in which case the CAPE index won't have to do a thing (other than watch the technology+communications "sector" continue to grow in weight). But what if State Street does finally create a communications Select Sector SPDR? There won't be any history for the new SPDR (just as there was no history for XLRE). Would the CAPE index turn again to a non-Select Sector SPDR? Also, as happened with XLF, the history for XLK will no longer precisely represent the new XLK after communications companies are carved out.
DSENX in turn will need derivatives that track whatever index or indexes the CAPE index chooses to track. Will they exist?
And they say that a machine can run an index fund.

What’s the virtue of a 10 year period? Seems too short on which to base any financial theory or lesson. But, over 100 years, Yup - the low cost passive fund should win out.

If you trend GLD and PRPFX, the 2 move in tandem. So, it could be argued PRPFX is a conservative way of owning gold, I think. I think you would own a fund like PRPFX for the same reason you would own a conservative balanced fund like maybe GLRBX, although over time I think a plain vanilla fund like GLRBX would have been a smoother and more lucrative ride. But in any case, it all comes down to being comfortable in how it fits your portfolio view.
What does that mean, PRPFX was "over-weight" gold? The weight within the portfolio doesn't change.

Mostly valid points @MikeM ...
With a combined 25% benchmark weighting to gold and silver, PRPFX will respond more to price changes in those metals than most funds having little or no exposure. Metals tend to be wildly erratic “assets”, which explains your preference at one time for this fund over owning GLD or a dedicated p/m fund. A bit like adding some water to your single malt to dampen the effect. I placed assets in quotes because there was a good thread here about 5 years ago debating whether gold should even be considered a “financial asset”.
Sounds like you had a reasonably good experience with PRPFX and moved out when momentum reversed. As with any open-ended fund, heavy selling by shareholders over short periods can ding returns, hurting those who stay behind - but there’s no way that I know of to prevent them, and I've occasionally engaged in the same practice to lock in a quick gain.
Adding a volatile investment to an otherwise conservative fund will affect returns during both the up and down cycles. Hussman, for example, once held significant mining shares in HSTRX. On the surface it appeared a mild mannered income fund. But in 2007 it outpaced the competition with a near 13% gain; than lost 8.37% in 2013. Suspect you’ll find those numbers track the performance / underperformance of GLD. (If memory is correct, p/m shares represented near 10% of the fund at times,)
I’ll go out on a limb and say I like gold / miners at the moment. In part that’s because most everything else appears so expensive. That said, timing the metals is a fool’s errand and I have 0% confidence in my outlook. Consequently, I currently maintain only a “token” foothold in a dedicated p/m fund.
Re “Overweight” (First mentioned in this thread by @PBKCM):
Unless a fund rebalances every day, rapidly rising prices for a particular asset might move that asset to a temporary overweight position relative to benchmark - until the manager rebalances. Don’t know how frequently PRPFX rebalances, but doubt it’s every day. So I’d expect that the fund went temporarily overweight gold for a stretch simply because it was appreciating much more rapidly than the fund’s other assets.