Sequence of Returns Risks

If you are close to retirement, bonds still make sense:

• Morningstar – Retirees: High-Quality Bonds

To understand why, you need to understand  sequence-of-returns risks:

• GMO – Who Ate Joe’s Retirement Money?

Long story short, once you are no longer accumulating wealth – it is important not to experience a large loss – just ask anyone that was planning to retire in 2008.

Headlines like this make me nervous:

• ZeroHedge – The Last Time Americans Felt This Good About Stocks, The Dot Com Bubble Burst 2 Months Later
• Bloomberg –  ‘Deep Subprime’ Auto Loans Are Surging

We are a bunch of slackers:

• Slate – A 94-Year-Old Woman Who’s Worked at McDonald’s for 44 Years Is Making the Rest of Us Look 

Extra – next time I am in NJ, I am taking my son to Diggerland:

• Bloomberg –  Where Kids’ Backhoe Dreams Come True