Hi Catch22,
Like most evolutionary movements much depends on timeframe and where you look. Women have successfully penetrated many professions. One industry that has escaped Gloria Steinem however has been the financial sectors, especially mutual fund management.
There is a huge, huge gap between what fund managers say and what they do. That gap is not possible in other professions such as among doctors and engineers. It is not a hard assignment to find statistics that demonstrate the bias that still exists in the mutual fund manager sector. Here is a Link to a recent Morningstar study that makes the case:
http://corporate.morningstar.com/US/documents/ResearchPapers/Fund-Managers-by-Gender.pdf
The stats tell the story without resorting to lie detectors. The Old Boys Club appears to be intact and working against females and clients in this financial arena. Note that I included clients as suffering damage. Studies show that women are terrific investors, are conservative, and introduce a diversity of perspectives in formulating investment decisions.
I too recognize that in some professions, the truth, the whole truth, and nothing but the truth is notable by its frequent absence. Politics anyone?
In my working career, I had the good fortune to hire and also to work for some very talented women.
Best Wshes.

I strive to maintain at least a five percent weighting in the minority sectors (materials, real estate, communication services and utilities) and at least a nine percent weighting in the majority sectors (consumer cyclical, financial services, energy, industrials, technology, consumer defensive & healthcare) within my portfolio. Since, I am at about a nine percent weighting in energy and energy now accounts for about a seven percent weighting in the S&P 500 Index this puts me at about a +2% overweight in the sector as compared to the Index and in a neutral position within my portfolio according to my allocation weightings. This leaves me with about seventeen percent that can be move around and overweight accordingly as to how I wish to allocate sector weighting within my portfolio.

Hi Guys,
Nowadays, it's all about freedom of choice. In the USA women are free to enter whatever occupation appeals to them on an individual basis. Education is not a limiting factor. More females do post-high school than men.
Women choose not to work as bricklayers (the construction industry) or as firefighters as a general rule. That's their choice. Occupational participation rates are dynamic and are in a constant change mode. There are now more women bartenders than men.
More power to females. They have earned it. They are patient, they are persistent, and they multitask better than their male counterparts. They learned that skill managing households and children.
I love them all. They will do well as more and more of them invade the financial money management world. Good for them and good for us.
Best Regards.

Hi Guys,
I’m a little amazed by how often referenced articles and posts interact with one another.
Just today, this article on Marc Faber and the 10 Laws of Wealth piece have that interconnected character. Here is the internal Link to the 10 laws article:
http://www.mutualfundobserver.com/discuss/discussion/28733/these-10-laws-of-wealth-can-help-you-hold-on-to-investment-gains
There really are no unexpected recommendations in this listing. Rule 4, “Forecasting is for weathermen”, is relevant for the Faber reference. Forecasters do hazardous duty and are challenged to score a 50% accuracy. Actually, weathermen have a much better record than financial wizards. Faber falls into that lower success ratio cohort. Here is the CXO Advisory Group Guru grade ratings:
https://www.cxoadvisory.com/gurus/
Based on a large number of predictions over an extended timeframe, Faber’s record is rather unimpressive. He scored at the 45% correct level. CXO asked the following: “Marc Faber: Nabob of Negativism?” My answer is a firm yes to that question.
Faber seems to always recommend a rather large portfolio asset allocation to Gold holdings, sometimes as high as 25%.
If that allocation is scraped from the fixed income portion of the portfolio (equities sort of held constant), overall portfolio returns should not suffer too much, and the portfolio’s standard deviation should be greatly reduced.
I loosely checked the numbers over several timeframes with Gold ranging from the 10% to the 25% portfolio weightings to verify my speculation. The few numbers I made confirmed my perspective. Please note that I do not do Gold in my portfolio.
Best Regards.

Drone investing
Target-date funds are a great financial innovation with the potential to help millions of investors. But if you do set your investments that way, you shouldn’t ever really forget them.
Investors on autopilot may never learn the basic financial concepts for themselves, just as self-driving cars may lull us into a dangerous complacency.
If something goes wrong — and in 2008, not only did funds fall in value more than some investors expected but some were found to be impermissibly overweighting their equity holdings, in violation of their prospectus — we may suffer more damage than if we had never relied upon them. That sounds something like when a car’s autopilot fails and passengers are hurt in accidents they might easily have avoided with a little attention to the road.

Everyone needs to make the decision themselves whether these investment vehicles are appropriate for them. As convenient as they are, we rebalance our portfolio several times annually and autopilot is not for us.

FYI: Ameriprise Financial is telling clients to sell OppenheimerFunds municipal bond funds with big holdings of Puerto Rican debt, adding to the chorus of critics of the funds' holdings.
Regards,
Ted
http://www.investmentnews.com/article/20160721/FREE/160729978?template=printart

"I suspect Ms. Yellen and associated folks just shake their heads on some days."
@Catch22- For sure. Ms. Yellin strikes me as one who is pretty resilient and one who keeps her eyes open. I'd be very surprised if she was proceeding with "head up and locked", as the old aviation saying goes. Frankly, very glad to have someone of her caliber at the controls.
I agree with your list of potential factors which may likely impact financial modes going forward. That's one hell of a lot of chickens looking for a place to roost:
---technology
---central bank policy(s)
---demographics (baby boomers and the young with low education and low paying jobs)
---jobs/wage growth (being jobs of consequence, monetary)
---ongoing affects upon personal budgets since the market melt
---societal unrest
---pension funds, life insurance companies (many underfunded and scratching for returns.
I suspect that future historians will regard the first quarter of the 21st century as a significant inflection point in the course of world history, as was much of the nineteenth century.
Take care- OJ

@Ted Actually, the byline could have been better, and it was almost accidental that my half-addled brain didn't move on by. Thanks for playing clean-up and finishing off the post "right and proper," as I'd intended to do (lately, my glass being only "half-full").
p.s. And may I say that you have been pretty darn sharp lately in finding most of the nuggets in the pile of largely useless goo the financial MSM has been spewing out for several months now. You may consider that a pat on the back for a labor of love well-done! I had no idea hula hoop usage could elevate one's game so noticeably, in the short-term. :)

"This time it's different".
Typically when this trope appears it refers to a situation in some particular sector of finance which is suspected of being in the "bubble" mode. For example, internet/tech, housing, etc. The "this time" characterization is usually an attempt by the financial barkers to rationalize whatever particular short-term market distortion is taking place, and to convince the unwary that everything is just fine, not to worry, keep on buying.
Junkster appears to be considering a much more fundamental situation, regarding general long-term changes in the financial markets which can affect or change basic expectations in the overall operation of the financial markets. He interprets Catch22's question as a suggestion that just such a basic change may in fact be well underway.
I'm inclined to agree with both Catch and Junkster. I believe that the effects of the last short-term housing distortion were so devastating that they triggered a massive effort by central banks and other major financial regulators to restore market equilibrium and head off a full blown international depression. In this attempt previously untried regulatory and "guidance" maneuvers have possibly resulted in an unanticipated long-term change, the end effects of which are still really unknown.
It's interesting that at this point there are no barkers shouting "Step right up! Put your money here!" Evidently even the promoters and financial con men really have no idea of where this whole thing is headed. Time to be really careful, folks.

Old_Joe You read my mind and much more succinctly stated than my attempt. Thanks!

"This time it's different".
Typically when this trope appears it refers to a situation in some particular sector of finance which is suspected of being in the "bubble" mode. For example, internet/tech, housing, etc. The "this time" characterization is usually an attempt by the financial barkers to rationalize whatever particular short-term market distortion is taking place, and to convince the unwary that everything is just fine, not to worry, keep on buying.
Junkster appears to be considering a much more fundamental situation, regarding general long-term changes in the financial markets which can affect or change basic expectations in the overall operation of the financial markets. He interprets Catch22's question as a suggestion that just such a basic change may in fact be well underway.
I'm inclined to agree with both Catch and Junkster. I believe that the effects of the last short-term housing distortion were so devastating that they triggered a massive effort by central banks and other major financial regulators to restore market equilibrium and head off a full blown international depression. In this attempt previously untried regulatory and "guidance" maneuvers have possibly resulted in an unanticipated long-term change, the end effects of which are still really unknown.
It's interesting that at this point there are no barkers shouting "Step right up! Put your money here!" Evidently even the promoters and financial con men really have no idea of where this whole thing is headed. Time to be really careful, folks.

Hi Guys,
Only on rare occasions does my wife read my posts. That’s too bad since her IQ is two standard deviations higher than mine, and her reviews often generate constructive suggestions. That didn’t happen in my earlier post which she has subsequently read and has identified some shortfalls. Based on her critique, here are a few additional thoughts on the topic.
I was far too circumspect in getting to an Indexing investment approach. And I only cited Warren Buffett as an Indexing convert. He is just one from a pantheon of famous, skilled financial professionals who have changed horses, and now endorse Index investing for a major portion of most individual investor’s portfolios. Charles Ellis and David Swensen are two other excellent examples.
In the Charles Ellis case, it is not a recent conversion. My wife reminded me of an article that Ellis wrote in 1975 that made the argument using mostly sports analogies. The published work is only a short 7 pages. Here is a Link to that pioneering piece:
https://www.ifa.com/pdfs/ellis_charles_the_losers_game_1975.pdf
Please give it a visit. It is a breezy piece of work with many familiar, understandable analogies – some even appropriate in today’s investment world. Enjoy.
Even at that early date, Ellis argued that investing had morphed from a Winner’s Game to a Loser’s Game because of the fact that well trained and well financed professionals were now competing against their equals rather than against much less informed amateurs. Ellis was still singing the same song when he updated his “Winning the Loser’s Game” book in 2010.
David Swensen wrote a nicely reasoned forward for that edition. He became a more recent convert while planning his “Unconventional Success” book. He changed horses when preparing the text for that volume. He realized that “The overwhelmingly large number of investors should seek membership in the passive management club”. That realization prompted him to completely reorganize his work in progress. Private investors can not practice what Yale does with its portfolio.
Investment advice comes in many colors and in as many flavors. Choosing to disregard most of it while accepting a small fraction is a difficult challenge. Getting similar advice from such financial lions as Buffett, Ellis, Swensen, and other industry superstars makes the decision a little easier.
In the end we always get to choose. To choose wisely is yet at another level. Good luck to all.
Best Wishes.

FYI: For a lot of financial advisers, the primary appeal of exchange-traded funds boils down to low fees and liquidity. There is no disputing the low fees, which provide investors with varied and broad market exposure for mere basis points, in most cases. But the liquidity has become a growing point of contention throughout the financial services industry and is something advisers using ETFs need to follow.
Regards,
Ted
http://www.investmentnews.com/article/20160710/FREE/307109998?template=printart

I started following Synchrony Financial SYF recently.
Had to sell OAK back in Feb/March with roll-over of my 401. Left proceeds in cash.
Sold HCP this week with departure of Lauralee E. Martin. I've basically owned the stock her entire tenure. Left proceeds in cash.
Remain heavy long-time holdings: BAC, AIG, AA, FAAFX and SIGIX.
c

FYI:
Regards,
Ted
July 14, 2016
Dear WEALTHTRACK Subscriber,
For inspiration and levity I occasionally turn to Lewis Carroll’s classic,
Alice’s Adventures in Wonderland. As I survey the still unfolding saga of Brexit, spreading negative interest rates around the world and the unsettling political scene in Europe and the U.S. two quotes seem particularly apt. As the Cheshire Cat told Alice about Wonderland: “We’re all mad here.” And as Alice opined: “it would be so nice if something made sense for a change.”
This week’s guests are trying to make sense of highly unusual and in some cases unprecedented developments. One of those is Brexit. After decades of opting into the European Union, albeit on some of its own terms such as keeping the pound sterling as its currency, the United Kingdom opted out. A pressing question is will Britain be the lone exception, or the first of many to do so?
A recent Pew Research poll found the EU was unpopular among substantial numbers of citizens in many countries. 71% of Greeks view the EU unfavorably, 61% of the French do, 49% of Spaniards and 48% of Germans agree.
Since the financial crisis there has been talk of Grexit, Greece’s possible exit from the Eurozone. The latest candidate is Italy with “Quitaly” envisioned as its struggling banking industry reels under pressure from EU regulators.
Then there is the impact of the unprecedented easing policies of central banks in major developed countries. On this week’s program, we’ll show you a chart from Evercore ISI that tells the story of the “Incredible Balance Sheet Expansion” of the big three. Since 2009, the Federal Reserve, European Central Bank and Bank of Japan balance sheets have increased a cumulative +$8 trillion! Among other things, this helps explain why bond yields have plunged. The yield on the benchmark U.S. Treasury 10-year note has hit new lows in recent weeks, while yields on German and Japanese bonds are trading below zero in negative territory.
In the week after the Brexit vote, Evercore ISI counted 18 more easing moves by central banks. How do these developments affect global economies and markets?
On this week’s WEALTHTRACK, we will hear the views of two experienced global investors. Nicholas Sargen, Chief Economist and Investment Strategist at Fort Washington Investment Advisors, the asset management arm of Western & Southern Financial Group will join us for a rare television interview. Sargen holds a PhD in Economics, and has been international economist, global money manager and Chief Investment Officer for several major financial firms as well as an official at the Federal Reserve Bank of San Francisco.
We’ll also be joined by William Wilby, in a WEALTHTRACK television exclusive. One of our Great Investors, now a private investor actively managing his own retirement account, Wilby was the Portfolio Manager of the award winning Oppenheimer Global Fund which was ranked number one in its category for the 12 years he ran it. A graduate of West Point, Wilby has a PhD in International Monetary Economics and has held various international finance and investment positions at several top financial institutions, including the Federal Reserve Bank of Chicago.
Both Sargen and Wilby believe the Brexit effect is far from over. I asked them why it is still so significant.
If you miss the show on Public Television this week, you can watch it at your convenience on our website. You’ll also find web exclusive EXTRA interviews with Sargen and Wilby about investing in the 21st century.
Thank you for watching. Have a great weekend and make the week ahead a profitable and a productive one.
Best Regards,
Consuelo
http://wealthtrack.com/
.

         



@AndyJ said ...yesterday sold a fairly large position in one muni cef (up a mind-boggling 14% ytd) and put the $ in PONDX and PTIAX, neither of which involve as much rate risk
Good call Andy.My only holding in the space down 2.25 % today
https://www.google.com/finance?q=NYSE:OIA&ei=9TuIV8m9N8PCmAGIzqfgBw
PTIAX has re-done it's web site.Good comparison to the big boys and where it differentiates here
http://www.ptiafunds.com/documents/ptam-difference_ptiax_final.pdf
New fact sheet here
http://www.ptiafunds.com/documents/ptiax_factsheet.pdf
Reviewing Jeremy Grantham's Mid May remarks.
This relative optimism was an unusual position for me and the snapback in these markets has validated, to a modest degree, my thinking at the time. I still believe the following: 1) that we did not then, and do not today, have the necessary conditions to say that today’s world has a bubble in any of the most important asset classes; 2) that we are unlikely, given the beliefs and practices of the U.S. Fed, to end this cycle without a bubble in the U.S. equity market or, perish the thought, in a repeat of the U.S. housing bubble; 3) the threshold for a bubble level for the U.S. market is about 2300 on the S&P 500, about 10% above current levels, and would normally require a substantially more bullish tone on the part of both individual and institutional investors; 4) it continues to seem unlikely to me that this current equity cycle will top out before the election and perhaps it will last considerably longer; and 5) the U.S. housing market, although well below 2006 highs, is nonetheless approaching a one and onehalf-sigma level based on its previous history. Given the intensity of the pain we felt so recently, we might expect that such a bubble would be psychologically impossible, but the data in Exhibit 1 speaks for itself. This is a classic echo bubble – i.e., driven partly by the feeling that the substantially higher prices in 2006 (with its three-sigma bubble) somehow justify today’s merely one and one-half-sigma prices. Prices have been rising rapidly recently and at this rate will reach one and three-quarterssigma this summer. Thus, unlikely as it may sound, in 12 to 24 months U.S. house prices – much more dangerous than inflated stock prices in my opinion – might beat the U.S. equity market in the race to cause the next financial crisis.
http://seekingalpha.com/article/3973997-always-cry-spilt-milk

What counts is a long term real money track record using the various forecasting models referenced. I spent decades monitoring the real money results of the so-called experts from Futures Truth, MoniReserach, Hulbert Financial Digest, and Dalbar, to name just a few. There are no experts and there is no magic bullet for predicting/forecasting the markets. If anything the best approach to successful trading/investing is a contrarian approach. But that is a story for another time. As to why some are more successful than others it is best summed up by Charles Faulkner in Jack Schwager's The New Market Wizards. "The bottom line is that these methods (some you have referenced above) seem to work only because the people who use them have developed some sort of *****intuitive***** experience about price. The ***** is my emphasis. Trading/investing is both an art and a science albeit I would say much more of the former than the latter.

Hi Catch,
Thanks for your interesting perspective. I agree that each investor gets to choose his own poison, although sometimes well meaning and well paid financial advisors intentionally usurp that responsibility. Regardless, investors are responsible for their decisions either made by themselves or some paid consultant.
I have had a dear and long-term relationship with one such advisor. I suspect we remain on friendly terms because I don’t invest through him, and I rarely accept his market pronouncements without careful due diligence.
The man is a flake. He is far too overconfident of his own knowledge base and the market’s projected direction. I suspect that he doesn’t keep score of his forecasts, but I informally do and its not pretty. He does play an aggressive tennis game, but, once again, he consistently overplays his perceived skill level. No surprise there.
It seems like every time one of his market forecasts goes haywire (quite often), he adds another parameter to his market prediction model. Not unexpectedly, the revised model reproduces the database with improved fidelity; that is, until the next market scoring period. If enough parameters are added, a near perfect match is likely.
Well, over several years, my friend’s market model has grown from about a 6 parameter model to perhaps a 15 parameter model. Yes, it does a better prediction today when contrasted to yesterday, but I suspect yet another revision will be implemented in the near future. If the number of open parameters are increased to exactly match the number of data points, a perfect reproduction (not a prediction) of the data set will happen.
Each of us has our own way of making a projection. As a general rule, the simpler the model, the more likely it will prove to be the better in terms of its robustness and longevity. Jack Bogle makes that precise point in many of his books.
But overall, precise market forecasting is a fool’s game. On an annual basis, returns are almost completely random in character. Adding parameters might make us more comfortable investors (a feeling of control), but they will not make us any wealthier than an Index-based plan. That might be a sad judgment, but it is fundamentally true except for a few very rare individuals.
I agree with Junkster. Everyone can control their money management with discipline, but forecasting the markets is an impossible task.
Best Wishes to All.

Yes, a week of normal breathing and regular heart rate. A nice respite. But as this continues, and the financial MSM only pumps up the positive to keep the momo going (in their service to the industry), it might be smart to start looking for trouble developing under the covers, as all good runs come to an end someday. In that regard, here are some data and commentary I ran across by Wolf Richter on his blog last week; all is not well in the shadows.
http://wolfstreet.com/2016/07/01/investors-fleeing-junk-bond-funds-leveraged-loan-funds/
http://wolfstreet.com/2016/07/06/big-unravel-u-s-commercial-bankruptcies-skyrocket/

FYI:
Regards,
Ted
WEALTHTRACK Subscriber,
Turmoil, volatility and uncertainty have long been considered enemies of stock markets. They certainly proved that once again in the days immediately following Brexit on June 23rd, when British voters passed a referendum to exit the European Union. For a few trading sessions investors fled stocks and other assets perceived to be risky and flocked to traditional safe havens such as gold, long-maturity U.S. Treasury bonds and debt of other countries considered to be of high credit quality, including Germany, France and Japan.
According to bond rating firm Fitch, sovereign debt with below zero yields increased by $1.3 trillion in the month of June to a total of $11.7 trillion, boosted by the Brexit vote. Longer maturity debt was particularly popular. Japan’s negative yielding debt grew about 18% to $7.9 trillion, France’s by 13% and Germany’s by 8% to over $1 trillion each.
Britain is the first country to exit the 28 country European Union, which took its current form in 1992 as a single market allowing goods, services, money and people to move freely among member states, as if it were a single country. It has its own parliament, located in Brussels, with the ability to regulate a wide range of areas including the environment, transportation, consumer rights, employment rules and even such things as mobile phone charges and electric tea kettles.
Its single currency the Euro wasn’t created until 1999. The United Kingdom opted to keep its own currency, the Pound Sterling, as did several other member countries including Denmark and Sweden.
Why did the Brexit vote set off such a firestorm in global markets? How much of a threat is it to the global economy and financial markets now?
Joining us on WEALTHTRACK this week are two market pros who have been tracking these developments closely. Philippe Brugère-Trélat, Executive Vice President of Franklin Mutual Series is a contrarian, value investor with years of experience investing in Europe and other international markets. He is Co-Portfolio Manager of three funds, all rated 4-star by Morningstar. He has managed Franklin Mutual European Fund since 2004, and both Franklin Mutual Global Discovery Fund and Franklin Mutual International Fund since 2009.
Our other guest is one of our Financial Thought Leaders. Jason Trennert is Co-Founder, Managing Partner and Chief Investment Strategist at Strategas Research Partners, an independent investment strategy and macroeconomic firm celebrating its tenth anniversary this year.
Identified by Barron’s as one of “Wall Street’s Best Minds”, Trennert and his team are known for their original and timely economic, political and market analysis and identification of investment themes. The firm recently started Strategas Asset Management to enable clients to invest in portfolios based on three of those themes. One is Policy Opportunities, another is Large-Cap Dividend Growth and the third is New Sovereigns, formerly their Thrifty Fifty portfolio which we have discussed on previous episodes. I will ask Trennert for an update.
If you miss the show on television this week you can always catch it on our website. We also have an EXTRA interview with both of our guests. As always, we welcome your feedback. Click on the Contact Us link on our website, or connect with us on Facebook or Twitter.
Have a great summer weekend and make the week ahead a profitable and a productive one.
Best Regards,
Consuelo

I'm with Catch- as Bob C. has opined, Brexit may not be a factor in the long-term. But there is a very real chance that the world-wide banking system is in for an extended nasty patch of uncertainty until the European politics settle down. With interest rates where they are there is almost no way that the international European banks can prosper, and there are way too many large financial swans flying around over there. Not only Greece and Italy, but even some large German and Swiss banks are finding themselves against the wall. Additionally, I won't be surprised if England and the EU drag out the resolution issues for a couple of years, leaving the future of London as a banking and financial center a major unknown.
Before this settles out we may be very glad that the US banks have been forced to increase their capitalization, despite their kicking and screaming every inch of the way. While the US is in better shape than Europe, the interconnectedness of world finance could very well make things more difficult over here also. Now the Fed not only has to worry about the US directly, but also what ricochet effects the US system might have elsewhere, which in turn would come back to affect the US. Things are far from promising in the banking sector, worldwide.