{"id":365,"date":"2010-04-13T09:00:19","date_gmt":"2010-04-13T09:00:19","guid":{"rendered":"http:\/\/ishmaels.net\/blog\/?p=365"},"modified":"2018-11-11T20:27:55","modified_gmt":"2018-11-11T20:27:55","slug":"remember-this-reality-statements","status":"publish","type":"post","link":"https:\/\/www.ishmaels.net\/blog\/2010\/04\/13\/remember-this-reality-statements\/","title":{"rendered":"Remember this = Reality statements"},"content":{"rendered":"

Investing and finance statements: 4-12-2010
\n“With inflation and interest<\/strong> rates low and on the rise as well as dividend yields most likely investors<\/strong> will not see investment returns that they have grown accustomed to over the past 20 years, at least not until valuations revert to or beyond their mean. This is going to make<\/strong> it difficult for retiring investors<\/strong> to buy and hold stocks for the \u201clong term\u201d as the long term<\/strong> is most likely longer than their current life span.<\/p>\n

Therefore, capital preservation will still be key for the decade at least while generating total returns in the form of stock<\/strong> dividends and interest<\/strong> from bonds as well as returns from non?traditional asset classes will define the difference<\/strong> from investing success and failure<\/strong>. In fact the entire basis<\/strong> of our investment philosophy can be summed up by a quote from Robert Rubin;<\/p>\n

\u201cAs I think back over the years, I have been guided by four principles for decision making. First, the only certainty is that there is no certainty. Second, every decision, as a consequence, is a matter of weighing probabilities. Third, despite uncertainty we must decide and we must act. And lastly, we need to judge decisions not only on the results, but on how they were made.
\nIf there are no absolutes, then all decisions become matters of judging the probability of different outcomes, and the costs and benefits of each. Then, on that basis, you can make<\/strong> a good decision.\u201d
\nIt should be obvious that an honest assessment of uncertainty leads to better decisions, but the benefits of Rubin’s approach go beyond that. For starters, although it may seem contradictory, embracing uncertainty reduces risk while denial increases it. Another benefit of acknowledged uncertainty is it keeps you honest. \u201cA healthy respect for uncertainty and focus on probability drives you never to be satisfied with your conclusions. It keeps you moving forward to seek out more information, to question conventional thinking and to continually refine your judgments and understanding that difference<\/strong> between certainty and likelihood can make<\/strong> all the difference.\u201d<\/p>\n

Living beyond your means statement:
\n“But in reality, it’s hard to reduce your own standard of living. <\/p>\n

As long as a lifeline is available, reform is impossible. It’s just too hard to say “NO” to the forces in place for so long that have actually caused the fiscal breakdown. The easy solution is to say “YES” and continue the spendthrift, irresponsible ways that have brought many to the brink of bankruptcy. ”<\/p>\n

The motivation for change<\/strong> only happens when someone stares into the eyes of his hungry children and realizes they’ll die if they don’t do something, anything, to put food on the table. <\/p>\n","protected":false},"excerpt":{"rendered":"

Investing and finance statements: 4-12-2010 “With inflation and interest rates low and on the rise as well as dividend yields most likely investors will not see investment returns that they have grown accustomed to over the past 20 years, at least not until valuations revert to or beyond their mean. This is going to make it difficult for retiring investors to buy and hold stocks for the \u201clong term\u201d as the long term is most likely longer than their current life span.<\/p>\n

Therefore, capital preservation will still be key for the decade at least while generating total returns in the form of stock dividends and interest from bonds as well as returns from non?traditional asset classes will define the difference from investing success and failure. <\/p>\n

“And Now the Rest of the Story – “Remember this = Reality statements<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[5],"tags":[],"class_list":["post-365","post","type-post","status-publish","format-standard","hentry","category-life-and-or-living-daily","odd"],"yoast_head":"\nRemember this = Reality statements - And That was How it Went<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ishmaels.net\/blog\/2010\/04\/13\/remember-this-reality-statements\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Remember this = Reality statements - And That was How it Went\" \/>\n<meta property=\"og:description\" content=\"Investing and finance statements: 4-12-2010 “With inflation and interest rates low and on the rise as well as dividend yields most likely investors will not see investment returns that they have grown accustomed to over the past 20 years, at least not until valuations revert to or beyond their mean. 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I have highlighted the most important lessons for you. 1. Because most investors ignore income opportunities, income may be more important\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":937,"url":"https:\/\/www.ishmaels.net\/blog\/2010\/07\/04\/talk-about-ponzi-scheme\/","url_meta":{"origin":365,"position":1},"title":"Talk about PONZI scheme…","author":"wd0ajg","date":"July 4, 2010","format":false,"excerpt":"Definition: \"A Ponzi scheme is a fraudulent investment operation that pays returns to separate investors from their own money or money paid by subsequent investors, rather than from any actual profit earned. The Ponzi scheme usually entices new investors by offering returns other investments cannot guarantee, in the form of\u2026","rel":"","context":"In \"APRS\"","block_context":{"text":"APRS","link":"https:\/\/www.ishmaels.net\/blog\/tag\/aprs\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":4253,"url":"https:\/\/www.ishmaels.net\/blog\/2011\/01\/10\/managing-the-10-most-prevalent-investment-risks\/","url_meta":{"origin":365,"position":2},"title":"Managing the 10 Most Prevalent Investment Risks","author":"wd0ajg","date":"January 10, 2011","format":false,"excerpt":"Time Horizon - the amount of time you can spare to have your money tied up in an investment. Investment mismatch is where money that is earmarked for the short term is invested in a long term strategy and vice versa.","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":5764,"url":"https:\/\/www.ishmaels.net\/blog\/2011\/04\/15\/mutual-fund-investing\/","url_meta":{"origin":365,"position":3},"title":"Mutual Fund Investing","author":"wd0ajg","date":"April 15, 2011","format":false,"excerpt":"Mutual funds are a hot commodity with individual investors and financial institutions. Mutual funds are actively managed by a financial money manager who constantly monitors the stocks and bonds in the fund's stock portfolio. Mutual fund investing is a good match for traders interested in long term investing.","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":3619,"url":"https:\/\/www.ishmaels.net\/blog\/2010\/12\/11\/10-different-ways-to-diversify-your-investments\/","url_meta":{"origin":365,"position":4},"title":"10 Different Ways to Diversify Your Investments","author":"wd0ajg","date":"December 11, 2010","format":false,"excerpt":"When you decide to invest in mutual funds or anything else, diversification is the best way to protect your investment. This is one reason why mutual funds are so popular. Mutual funds are an easy, inexpensive way to diversify your investments.","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":5748,"url":"https:\/\/www.ishmaels.net\/blog\/2011\/04\/13\/purposeful-investing\/","url_meta":{"origin":365,"position":5},"title":"Purposeful Investing","author":"wd0ajg","date":"April 13, 2011","format":false,"excerpt":"It would be hard to develop a strategy to pay off your debt if you had no idea how much debt you had. It?s just as difficult to develop an appropriate investing strategy if you don?t have a reason for investing. 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