It's hard for me to read around the WSJ ad covering 80% of page and was unable to cut and paste the relevant passage. But, I'm very perturbed to read that Obama's 2015 budget would, if approved, make Roths subject to mandatory withdrawals at 70.5 the same as for traditional IRAs.
Let's hope that doesn't go through. Ability to defer withdrawals (and taxation) on that portion of retirement investment was the #1 reason I prepaid considerable taxes in order to convert a sizable portion of my Traditional to Roth only a few years ago. (My ... how quickly things can change.)
Issue here is financial "planning". I can invest and earn a decent return in a variety of ways (as can you). But, if government can change the rules in the middle of the stream ... how can anyone plan effectively for the future?
Edit: The thinking there is curious. Are they hoping for a court challenge as to whether the change could be applied retroactively? Than, if successful in court, perhaps implement the next stage - fully taxing Roth withdrawals? OMG - I'M beginning to sound like Fox News, :(

@Old_Skeet: Held IJH for close to five years which a nice performance, beating, SPY, but thought it was time to try and capture the upward momentum of the Nasdaq.
Regards,
Ted
YTD:
QQQ: 14.82%
IJH: 8.15%
Three Months:
QQQ: 8.11%
IJH: 2.23%

I bought into ARIVX and Cinnamond when it first came out because of his conservative style .... I dumped it when I saw his affinity to precious metal miner stocks. He has been caught in a value trap for years now and won't adjust.

That was my ARIVX experience exactly, Mike; sold the last of it in January '13.

Sven, the fund wasn't around in 2008, but the fund manager was and he handled his ICMBX fund superbly. So, there is a track record.
I bought into ARIVX and Cinnamond when it first came out because of his conservative style and the good press it got from David here at MFO. I dumped it when I saw his affinity to precious metal miner stocks. He has been caught in a value trap for years now and won't adjust. Ala Hussman? Maybe that's to harsh.

Thanks For both, my original thesis of buying this fund was that it would be a steady small cap fund based on manager's prior fund track record, which I owned briefly (less than three years).

Three years is a bit short. Like to see a longer track record, at least through a down year like 2008 and its drawdown.

But with 75% in cash, this fund still lost .53% today in a slightly down market. Did I miss anything here with this fund, or should I move on to other real SCV funds?

With the unique holdings in the top 10, I wouldn't assess it on the basis of how much it lost today versus how much the market lost. Because this definitely is not a "market" kind of fund, it has NO characteristics that are index-like.
Take a look at the sector weightings. This fund goes its own way and does not look at what others are doing.

I would study the manager. I Googled him, and there is plenty to read about him, including several interviews, to understand his current and past thinking and investment strategy.
You could read his fund reports. There is a semi-annual report that came out in July of this year. And whatever shareholder communications he has.
Below are the calendar year returns. His first full year of operations, he was at the top of the heap. The next two years, the bottom......
Where he will be over the next few years is totally unpredictable

Hi Charles,
Thank you for reading my post.
In brief exchanges such as yours, it is sometimes a challenge to interpret your intentions. Were you simply pulling my leg or were you asking serious questions? I’ll assume the serious purpose.
A reversion-to-the-mean is surely not a law in the same league as a physics law. I used the term just to draw a parallel between a hard science and a soft science. More properly, a regression-to-the-mean is probably better characterized as a statistical concept.
It is a way statisticians describe an outlier event that deviates from some average, expected outcome. In their earlier years, Kahneman and Tversky observed that when pilots performed either above or below their normal performance standard, subsequent flights reverted to their average skill levels. Instructors like to think it was their training guidance; the Behavioral scientists judged otherwise.
If a ball player scores 4 hits in a single game, it is highly likely that he will not repeat that exceptional output in the next game; he will display a regression-to-the-mean tendency. Likewise, if he hits at a 400 batting average for a month, it is doubtful that his hot hand will persist. Again, he will revert towards his historically normal batting average.
The time horizon for the regression-like pull is unspecified. When investing, it depends upon the investors specific timeframe. If he trades frequently, the comparison period must be representative of that short timeframe. If the investor is planning for the long-term, the representative “mean” value should adequately reflect a long time horizon.
My preference is for longer running data collection averages for comparative purposes. I recognize that this bias introduces data staleness risk. So some experimentation is needed to properly identify a meaningful data period to calculate a “Mean” value.
Sorry for wasting your time with this reply if you were just playing “a pulling of the leg” game. I’m sure you knew everything I just reviewed.
But did you know that Earth’s gravity is NOT precisely constant? It depends on location, ground water level, and shifts under tectonic plate activity. Social laws are temporal and uncertain. Even physics laws are approximations and sometimes infrequently revised. Change happens.
Best Wishes.

Hi Guys,
The referenced article is indeed excellent. However, it really contains no surprising information. It just reinforces a wide body of earlier research findings that grow more compelling with each year’s additional data.
Mutual fund performance persistence is largely a myth, with a few outstanding exceptions. The game plan should be to find and stick with those noteworthy exceptions. The article identifies a few of them.
In physics, the law of gravity dominates. Although not quite as universal, within the investment community, a regression-to-the-mean law seems almost as pervasive.
The evidence against fund persistent outperformance is overwhelming. In its early years, the Morningstar 5-star rating system proved so vulnerable to performance decay, and subsequently to star erosion, that the firm was forced to modify and expand its ranking methods to salvage its fading reputation.
The numerous periodic table of returns published annually by a host of industry giants demonstrate the fragile nature of last year’s winners. The rotations are swift. Buying last year’s top performers has proven to be a Loser’s game.
Each year, Fortune magazine issues a list of the most respected and the most despised companies. The list does have some stability year over year. However, the market returns from owning the most accomplished companies over the long haul do not match those yielded by the least honored outfits. From an investment rewards perspective, this is yet another illustration of a regression-to-the-mean pull.
All MFO regulars should be familiar with the often referenced Standard and Poor’s SPIVA and Persistency reports. These documents have registered fund persistency failures for many years. Here is the Link to those data rich reports:
http://us.spindices.com/resource-center/thought-leadership/spiva/
If motivated, you can click on the specific SPIVA and Persistency items to explore more deeply. The SPIVA mid-year report was just released. I have not yet accessed it.
Michael Mauboussin has written extensively about the tradeoffs between luck and skill in determining outcomes. He concludes that as the skill level of professional money managers has escaladed over time, the luck component becomes the more dominant factor. There are fewer and fewer Excess Return opportunities. Hence, expect that persistent superior performance should degrade even more in the future and should be more difficult to identify.
That’s an imperfect signal that favors an Index-like approach. Institutions have recognized that signal, and are moving more aggressively in that direction. Perhaps we should too?
Best Wishes.

Any reason you would choose one over the other? I was really impressed with David's write-up about SCMFX from a few years ago and I like the more reasonable expense ratio, but the performance and volatility are very close to one another. The downside in 2008 was very similar. DHMCX has 6 times more AUM and 62 holdings rather than 35 but neither is running into any issues with size. Or is there another small/mid-cap value leaning fund you'd prefer? Many of the others I'm aware of and find appealing (relatively focused portfolios, smaller AUM, manager with a really good record, good alpha as I'm not so worried about volatility except in the extreme, reasonable expenses) are closed.

Who knows if Mr. Fuss will be right about the timing of his moves. But he is acting on convictions, and that is good enough for me. It is darned hard to argue with his record. We have essentially been out of core bond funds for the last 3-4 years. If Mr. Fuss turns out to be correct, the last thing I want is to be stuck holding a fund that has no flexibility to adjust its holdings. As most FA readers know, we use LSBDX as a holding, along with OSTIX, and depending on the custodian, TSIIX, GSZIX, or BSIIX in most client accounts.

Mr. Ruffles is correct - the author is quite confused; Skeeter's interpretation seems much closer to the mark. (More than one Barron's author recently has misunderstood basic concepts.)
Other misunderstood items ...
"Cash and cash equivalents" does not mean Treasuries (and Canadian bonds). "Cash" does not mean "secure", it means ultra short term. The reported 27% appears to come from the writer adding up LSBDX's Treasury and Canadian holdings. Loomis Sayles itself reports cash and cash equivalents (as of 7/31 - the last date on its website) as 1.6% (up from 1.1% the previous month). Even adding in bonds with durations under a year, we only get up to 16%.
Maturity isn't what matters; duration (and convexity) are. (Also, the benchmark LS uses has an average maturity of 7.86 years, in contrast to the supposed 12 year typical maturity the author claims for this fund.)
LSBDX is a multisector bond that is restricted in the amount of foreign bonds it can hold. Except, it can hold an unlimited amount of Canadian securities. So pulling out of Europe and Asia is not necessarily a bet in favor of the dollar (sorry, Skeet). One should look at non-US (i.e. Canadian) exposure too.
To put it another way, Fuss saying that there is risk "overseas" is not the same thing as saying that there is risk in "foreign" currencies. Aside from Canada, the fund has increased its exposure to the Mexican Peso in the past year (it was under 2%, now at 3.4%).
In any case, the only exposure to Asia or Eastern Europe a year ago (Sept 30, 2013) were miniscule amounts in South Korea, Indonesia, and Singapore. Okay, Singapore has been dropped as of July 31, 2014.

FYI: Ten years ago at this time, the mutual-fund "timing" scandal was still making headlines. Over Labor Day weekend the year before, news broke that New York Attorney General Eliot Spitzer was investigating mutual-fund companies for allowing hedge funds to engage in trading of mutual-fund shares that hurt long-term investors and in some cases was outright illegal.
Regards,
Ted
http://online.wsj.com/articles/mutual-fund-scandal-ripples-even-a-decade-later-1410120105#printMode

McCully makes some good points regarding why inflation is low. However, I think his analysis is short sighted and somewhat superficial. Maybe that's just the way these financial guys view things,
Let's also consider:
(1) the influence of an aging population shifting from their free wheeling debt laden "accumulation" years to a life style where financial security (thru home ownership, insurance annuities, savings) is paramount.
(2) the near demise of labor unions - for assorted reasons
(3) the increasing wealth disparity around the world and the increasing influence of money In our domestic political process. As McCully points out, the wealthy benefit more from low inflation (and thus have an interest in keeping it low) because their savings erode less rapidly. Debtors, on the other hand, benefit more from an eroding Dollar by repaying their debt in "cheaper" ones.

FYI: Most Top-Rated Funds Lose Their Crown. Here are Seven Lessons for Investors.
Regards,
Ted
http://online.wsj.com/articles/how-funds-with-5-star-morningstar-ratings-10-years-ago-have-fared-1410120116#printMode

I thought old Skeet did a nice job summarizing Fuss's thinking.
I think we tend to overstate the extent to which Fed influences longer term rates. Generally their influence is at the shorter end of the curve. Longer rates react more to inflation expectations. So, it would not be inconsistent to fear rising rates longer-term while expecting Fed to keep short term rates low for longer.
I think Fuss is brilliant - and very approachable as well. I also think, like many of us here, he has been somewhat befuddled in recent years by how low rates have gotten and, more significantly, how long they have stayed low.
I'm not sure I agree with his thinking re global macro politics. But, reading the tea leaves (his) it's a dire prophesy. I've been thinking the logical outcome from the U.S. Russian conflict will be political drum-beating at home, an arms build-up, increased deficit spending and a weakened Dollar which would cause many foreign currencies to appreciate visa vie the Dollar.

expatsp I don't think Fuss contradicicted himself ... Below is my take.
In reading the article the message I received is that Fuss is trying to stay a step or two ahead of big money as he feels they will soon begin to exit certain foreign positions and wants to be out before the liquidity starts to dry up in these foreign securities. I believe, he is also saying the US and Canada will become the better place to be once these headwinds start to blow over many of these foreign markets while at the same time the US will not be without some headwinds itself. With this he has been selling the longer dated domestic maturities and also moving this money to cash. Typically he would be running with an average maturity of about twelve years but now has reduced this down to about six and one half years while staying with the short to intermediate term securities. Usually in a big storm, the winds can come form more than one direction and many times twister formations develop. And, these twisters formations can develop into some very nasty storms. With this, the safe haven place is cash and this is the asset class that he has now started to build.
With this, I am glad that Fuss is the senior money manger for one of the six fixed income funds that I own within the fixed income sleeve of my portfolio and that is NEFZX. And, another former Lommis Sayles standout is Kathleen Gaffney who worked with Fuss a good number of years who is now with Eaton Vance and manages another fixed income fund that I own and this fund is EVBAX. I believe she is in a cash build mode as well.
Perhaps a few of our better posters that are good at making calls and moving money can make a comment here about this and that is Junkster amd Catch22. I believe both of them are several cuts above me in reading the tea leaves within the fixed income area. It would be interested in knowing their takes on this. Perhaps, they will stop by and comment. Also, BobC positions a lot of client based money and it would be interested in hearing his take as well. All of these would be my big three plus no doubt Scott stands tall in this area too.
Heck, we have a good number of posters on the board and I am sure there are a good number beyond those that I mentioned that might have thoughts worth reading as well.
Old_Skeet

Thank you. Cash position at over 20% is the highest in recent years. Dan Fuss is preparing for the worst scenario since geopolitical riisk can spread into other markets.

Seems to me rates in Japan went negative in some loan sectors for awhile. Some car loans in particular carried negative interest rates. Total cost to buyer was actually higher if he paid for the car up front instead of over time.
Explains why the BOJ has been fixated on rekindling inflation in recent years. I don't know where we're headed, but deflation would bring on much hardship and a popping of all asset bubbles (except U.S. government backed bonds).
Good discussion by all.

I should clarify that the Twentieth Century comment was a bit off topic. Yes, they are a no load fund company. I was reminiscing a bit from my early investing years.
In our 403b through an insurance company we had a list of funds to pick from. These were all load funds varying from about 2.5 to over 5%. We could look them up as they were common names like Lord Abbett and Franklin for example.
It was hard for me to believe that a fund with a 5% load would be "free" via the insurance company that managed the 403b. So like you, I didn't believe what the reps stated. Also their scheme was to get one into as many funds as possible. I'm sure there was a commission involved. A lot of these funds were duplicative but per the rep this was to diversify your holdings which sounded good. Most employees had no idea what was going on. That was the hand we were dealt so we had to make the best of it. I know this is a common story in the 401k/403b universe.