A few weeks ago some Japanese chemists synthesized a new chemical element. That element existed only in their lab, and only for the duration of their experiment. Yet there’s a naturally occurring (somewhat) element that’s about as rare. Astatine, discovered in the 1940s and whose most stable isotope has a half-life of barely 8 hours. They say that at any given time, less than a teaspoon of astatine exists on the Earth. That compares to francium, which is even less stable but slightly more common: up to an ounce of it exists terrestrially.
Welcome to another rendition of the Carnival of Wealth, the only personal finance blog carnival clinically proven to regrow hair. (And whose themes are getting more and more arcane.) Personal finance blog posts from all 4 corners, reduced to their essence in a hopefully entertaining fashion. Let’s get it on:
Anyone catch Friday’s post? Don’t say in 100 words what you can say in 16. Harry Campbell at Your PF Pro shopped around for flu shots and found $17 ones at Costco. But if you happen to work for Harry’s unidentified employer, you can get one for only $3 more and not have to go to Costco. This post is an early candidate for our Self-Contradictory Line of the Week Award:
I know there are some arguments against getting a flu shot, but if you can get it for (sic) free, there’s really no reason not to.
Make sure you read the comments for fascinating descriptions of other personal finance bloggers’ flu shot-getting strategies.
A couple weeks ago we piled on and helped tear into that idiot college professor who thinks learning algebra is a waste of time. This week, the formidable Dave at 6400 Personal Finance assails him as only a liberal arts student-cum-U.S. Army field artillery officer can.
Okay, this is 3 in a row from the folks at Becoming Your Own Bank, who insist on selling us on the virtues of whole life insurance – one of the dumbest “investments” you can make. Today, instead of praising mutual funds, the Becoming Your Own Bank crew (no author name given this week) assail 2 targets – mutual funds, and the English language. Whoever wrote this is convinced that mutual funds are wastes of money, but doesn’t say why.
Oh, what the hell. They didn’t get the gentle hints in prior weeks, so it’s time to ratchet our critique up. This post is embarrassing. Here’s the closing line:
I prefer much more intelligent ways to invest my money. Mutual funds…. no thank you.
And those much more intelligent ways are? Undisclosed. So what was the point of this cow pie of a post? Here’s another brutal excerpt:
Have you ever heard of someone that made millions by investing in mutual funds? Of course not. I’ve been in the financial planning world for 5 years now, and not one person I know of has made their millions in mutual funds.
Careful, you don’t want that straw man to catch fire before you finish assembling it. No kidding, no one makes millions in mutual funds. Mutual funds are conservative investments intended to preserve wealth, not to make you rich. This is like saying “No one made their millions by shopping at discount stores”, or “No one made their millions by putting 20% down on a house.” Doesn’t mean you shouldn’t do it.
Enough with the content. Now let’s attack the form of this unreadable piece of detritus. We’ve got the ever-popular and ever-redundant “$800 dollars”, questions ending with periods, it’s/its confusion, and the author even choked on the their/there homonym. Twice. How do you make it out of the 4th grade without knowing this stuff?
For the Bizarro version of this post we go to Andrew at 101 Centavos, a conscientious contributor who actually knows how to evaluate investments. His latest focus? Industrial material handling! That, and the funeral industry. Even when we’re mired in a prolonged recession, there are no such things as people who are too poor to die. Andrew even knows the difference between “funeral” and “funereal”, having mastered there/their/they’re several decades ago. Buy Hillenbrand, and step gingerly around Andrew’s dreadful funerary puns.
Big Cajun Man at Canajun Finances is back, and is mercifully once again writing his own stuff. This week he offers a brief if spirited lament against people who tell you not to worry about debt. He’s right, more or less, but with a qualification. Consumer debt is the ultimate financial idiocy, or at least on the short list along with gambling and smoking. Leverage – incurring debt to achieve greater returns than you would just by using your own wherewithal – is not only brilliant if done correctly but the only way most of us are ever going to get rich. It’s consumer debt that Big Cajun Man tells you you’re a moron if you incur, and he couldn’t be more right.
No you can’t. Roger Wohlner at The Chicago Financial Planner asks you, rhetorically, what his clients ask him – Can I retire? If you want the answer to be “Yes”, read the questions Roger lists and don’t draw more than 4% a year from your principal.
Our Awkward Hyphenated Word of the Week goes to “quicksand-like”, courtesy of Teacher Man at My University Money. He created a color-coded budget for college students (that’s a “colour-coded budget for university students” for all you mouth-breathing Canadians), ready for you to download. Over/under on people who will download and use this budget? ½.
Adrienne at My Dollar Plan not only fought city hall, but won and now carries its left ear on her belt as a trophy. She thought that the local functionaries charged with assessing the value of her home were too liberal in their estimates, fired back with data, and ended up saving $900 over the next 3 yeras.
Continued verbosity from John S. at Frugal Rules, who explains why high-frequency trading bears some of the blame for Facebook’s dropoff from its IPO levels. Well, that and Facebook’s ridiculously high IPO price. Or have we forgotten that Facebook is a glorified scrapbook and photo album? High-frequency trading doesn’t explain why Facebook has lost half its value in its 5 months of existence as a public company, nor why it’s still trading at a preposterous 66 times earnings.
Dividend Growth Investor slaps the negativity out of you this week, if you’re one of the people who think that dividends are an awful investment because they get taxed at 15%.
Some people say, “Look at Berkshire Hathaway. They’ve never paid a dividend.” Yes, and you also need $13 million or so to buy a standard lot of their stock. How about concerning yourself with more relevant financial topics? Also, Warren Buffett’s mentor Benjamin Graham said that dividends are the investor’s “secret weapon”. Buffett knew, and knows, that it’s better to be on the side of determining who receives dividends than on the side of begging for same.
["Dividend losers", as Dividend Growth Investor defines them] hate to have to research a company, formulate a strategy and execute that strategy however. Reinvesting the dividends from their income portfolio seems like too much work for dividend losers.
Aside: Good thing that we’re now 2 debates in and neither presidential candidate has said a word about reforming our cumbersome ganglion of a tax system. God forbid we eliminate capital gains taxes, like the Irish did. Instead, let’s continue to implement double taxation, burn billions of man-hours a year on tax preparation, and do anything other than encourage productivity.
If we give you the title of W at Off-Road Finance’s post, you’ll groan and go on to the next submission. What the hell, here it is: The Difference Between Academic Econometrics and Quantitative Finance. But don’t groan. Like most of W’s stuff, it’s brilliant. Here’s the takeaway:
[E]conometrics is the mathematical art of being right about financial matters only when lots of other people are also right whereas quantitative finance is the mathematical art of being right when everyone else is wrong.
He continues: it’s no good to be on the right side of a bet if there’s no one to take the opposite side. Being contrarian for its own sake is stupid. You need a compelling reason. Damn, this is turning into one of those posts that’s so good we end up quoting almost the whole thing:
[The] more valuable…sort of education is to start being right when everyone else is wrong. That’s where the power is. If you you have the wacky belief that people will pay to feed virtual cows, everyone will think you’re an idiot. But when you happen to be right, you become Mr. Billionaire Idiot which is more than suitable compensation for the scorn heaped upon you.
Zynga founder, take a bow. As for W, he suggests that you deliberately troll people on the internet who’ve taken a position popular, incorrect, and opposite yours. W says you’ll build mental muscle this way. At the very least, you’ll build toughness.
If you want to make a lot of money, unpopular and right is where you must live your life.
Sure enough, this provocative and inspiring post has zero comments. Meanwhile, the latest mommy blogger pumpkin spice latte recipe has 300 comments from yentas saying, “Sounds so yummy!!! Can’t wait to try this with my fam!”
Ken Faulkenberry at AAAMP Blog talks about how to minimize risk in your stock portfolio. Determine how much you’re willing to lose, allocate your assets tactically, and lower your personal tolerance for stupidity. There’s more, including a link to his 32 Investment Rules and Strategies.
Free Money Finance writes about “The Difference 1% Can Make”. Alas, this isn’t a post about those of us who are keeping those filthy Occupy Wall Street cretins down, which would have been great. Instead, this post is about how consistent 100-basis point increases in your raises can make a gigantic difference in your net worth.
Speaking of raises, Michael at Financial Ramblings says you should commit half of every raise to your retirement.
If you can get past the trite opening in Charles Davis’s piece on Wallet Hub, “Purchasing your first home still represents the embodiment of the American Dream®”, as the homosexuals say, It Gets Better. Professor Davis tells us that start-up costs are probably more than you think, but that you shouldn’t let that dissuade you. And you shouldn’t. There are dozens of government programs available for first-time homebuyers, because – never forget this – there is no aspect of American life in which the federal government doesn’t reserve the right to poke its nose.
Reverse redlining is a thing? We’ve all heard of redlining, the process by which lenders won’t lend to folks who live in more, uh, “bargain” neighborhoods. John Kiernan at Wallet Hub’s bohemian sister Wallet Blog explains reverse redlining, which sounds like it’d mean offering lower rates to people in fancy ZIP codes, but isn’t. Rather, it means offering horrible rates to those same downtrodden people from the first example. Long story short, Morgan Stanley offered subprime loans to a bunch of people who were somewhat likely to default. The ACLU is suing Morgan Stanley, who were probably just following federal lending and housing laws to the letter anyway. Either that, or Morgan Stanley would have been forced to offer low rates to people who’d default, which means Morgan Stanley would be carrying more risk with less potential for reward. Bottom line, the ACLU already shook down Bank of America and Wells Fargo for half a billion dollars via settlement. Then again, Bank of America could stand to be taken down a peg after receiving a multibillion-dollar taxpayer bailout. See? Conflicting regulation and state capitalism make everything better!
Finally, Liana Arnold at Wallet Hub’s sexy cousin Card Hub takes us into the unseemly world of debit card swipe fees. Banks, card companies, the Federal Reserve and major retailers are all on different sides and occasionally the same side as a multibillion-dollar settlement withers. It’s the 1990 Yugoslav Wars of swipe fees, factions allying and breaking apart with little discernible logic.