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There are mirror websites at http://hiqnews.megafoundation.org,
http://www.geocities.com/rnseitz,
and
http://www.geocities,com/ultrahiiq
11/20/2008 Update: Today's
Investment Commentary
Given the grave concerns about our current
economic crisis, I'm going to try to address, as best I can, some
problems and concerns that we might be sharing about this subject.
I want to reiterate: even if you've lost half
your retirement nest-egg, don't despair. There are (I think)
reasonably conservative ways to recoup your losses within two or
three years even if the markets don't fully recover for a decade
or more (see the sidebar in
Today's
Investment Commentary). Right
now, though, watchful waiting is the watchword. With the
volatility indices (VIX, VXO) at historic peaks, even professional
traders are sitting on the sidelines.
The three questions that were posted here may
now be found on the
Today's
Investment Commentary
page.
11/12/2008:
The stunning implications of the fact that we're, perhaps, in a
super-bear market are only now penetrating my skull.
A Buy-and-Hold Strategy Applied from
the Start to the Finish of a Super-Bear Market (e. g. 2000 to
2018, Assuming That This Concept Is Valid) Would Typically Lead to
60% to 65% Losses Over the 17-18-Year Period After Correcting for
Inflation and Adding in Dividends!
Over the course of a (typical?) 17-to-18-year
long
super- bear market, the value of an S&P 500 index fund, after
correcting for inflation and adding in dividends, typically
drops to 1/3rd of its value from the
beginning to the end of the 16-year secular (super-) bear
market period. In talking about a "typical" super-cycle,
I need to mention that these super-cycles are inferred from the
chart pattern of the S&P 500 from 1871 to the present. Over
that time span, there have been 3 super-cycles and, it would
appear, part of a fourth, from 2000 to the present time... if, in
fact, these super-cycles are real enough to have predictive value.
But no two of these super-cycles have been just alike.
("History doesn't repeat itself, but it rhymes."?) You
might take a look at the above-linked chart
displaying the S&P 500 from 1871 to 1997 and see what you
think.
Where We Stand Right Now, and Where We
Might Go from Here:
So far, money invested in an
S&P500 index fund in March, 2000, has fallen
by now, after correcting for inflation and adding in dividends, to about ½ of what it was worth in March, 2000.
However, because the S&P 500 was overpriced by... 65%?... in
March, 2000 (by far the most overpriced it's ever been), then if
we are in a super-bear market, this money in 2018 should be worth
about 40% what it is now. In other words, money
invested in a buy-and-hold S&P 500 index fund in March, 2000,
should be worth, in 2018, only about 1/5th what it was when it was
invested in 2000!
A Buy-and-Hold Strategy During a
Super-Bull Market Yields Dramatic Gains
(b) All of the long-term gains registered
by buy-and-hold investors occur within super-bull markets, and
they're sufficient to overpower the fall of the price of equities,
in real value, to 1/3rd of their previous highs, plus the average
6.8% a year that Dr. Jeremy Siegel has found for the long term
average rate of return of the U. S. stock market from 1802 through
2004. This points to a staggering
conclusion: our best stock market strategy would be to sell our
stocks at the beginning of a super-bear market, and to avoid stock
investments for the next 16-to-18 years until the beginning of the
next super-bull market. So how many individuals and
companies that make money by selling investment services do you
think are willing to tell their customers to avoid the stock
market for 16-to-18 years at a stretch? Yeah, that's the same
number I came up with, too.
But... We're in Uncharted Territory
Because we're in uncharted territory,
experiencing the first deflation since the Great Depression, the
markets could go lower than usual, although we might expect them
to return to their hypothetical trend lines by 2018 (no
guarantees, of course).
These Speculative Predictions and
Interpretations Apply Only the the U. S. Stock Market
These predictions, if they unfold as
they have in the past, apply only to the U. S. stock market. I
have no data concerning non-U. S. markets (although non-U. S.
markets have a habit of moving more-or-less in lock-step with the
U. S. stock market). I'm particularly hopeful that the Chinese and
Indian stock markets may decouple from the U. S. market over
the coming years.
11/9/2008:
Over the weekend, I've re-examined the subject of super-bull
markets and super-bear markets, and I don't like what I've
found. Of course, there's nothing that says things have to work
out this way, but the numbers are suggesting a super-bear market
bottom in 2018 that would be 55% to 65% below where the popular
indices stand today even if our current malaise turns out to be a
standard, garden-variety recession, with a cyclical bull market
starting up again in 2009 or 2010.
A buy-and-hold strategy in most mutual funds in
such a scenario would be a disaster, although there may be a few
funds that can outperform the market sufficiently that you'd come
out well ahead even if the blue-chip index funds lose 2/3rds of
their purchasing power. The above-linked write-up will explain.
11/2/2008 Important (Second) Update: This "recession" is
categorically different in cause
and consequences than any of the normal recessions we've
experienced over the past 60 years.
Unlike all the other recessions since World War II, this recession
(Depression?) is deflationary, driven by a credit crisis, rather
than a result of the Federal Reserve Board's overshooting its mark
in its efforts to slow the economy in order to rein in inflation.
This may be "The Perfect Storm".
6/7/2008:
As many of us are probably aware, there are now techniques that
seem to subtract 15 or more years off our biological ages. It will
be decades before such results can be verified through
large-scale, long-term studies, but some of us are availing
ourselves of these "bleeding edge" stratagems, with
dramatic improvements in such ponderable parameters as blood lipid
profiles, fasting glucose and insulin sensitivity levels, and
related health measures. Along with living
longer (and, in fact, these disease reductions are prerequisites
to living better longer) are techniques for putatively
reducing the risks of cancer, cardiovascular disease, Alzheimer's
disease, Parkinson's disease, and Type 2 diabetes. Again, there
are no guarantees. It will take decades of large-scale, long-term,
placebo-controlled studies to validate the various pilot studies
that have been conducted to date... studies that are concerned
with special nutritional and supplement interventions that don't
involve patentable drugs. Still there's compelling evidence that
some of these maneuvers really do work. For example, As an
example, four years ago, I was going to my dermatologist every
three months to have actinic keratoses--sunlight-induced,
precancerous lesions--frozen off the top of my head. After I began
drinking green tea four years ago, these lesions disappeared and
have never returned--in keeping with numerous studies showing that
green tea fights skin cancer. Other members of the Calorie
Restriction Society have had a similar experience. This is
certainly anecdotal, but nevertheless, this is what's
happened.
Another example of startling discoveries that,
to my knowledge, haven't made it into widespread public view is
Harvard Medical School researcher Dr. Norman Hollenberg's
discovery that the Kuna Indians, who live on a relatively isolated
group of islands off the Carribbean coast of Panama, have 1/10th
(that's 10%!) of the age-adjusted rates of heart attacks,
strokes, diabetes, Alzheimer's disease, and cancer than do their
North American counterparts. (See this
for diabetes.) The key to this seems to lie in their drinking 3 to
5 cups a day of "raw"
hot chocolate. (The crucial ingredient seems to be epicatechin.).
These dramatic reductions in degenerative diseases aren't
attributable to genetic inbreeding, because Kuna Indians who move
to the mainland and adopt mainland diets suffer the same ills that
plague the rest of us. (You can buy this unprocessed cocoa at
outlets like iHerb.)
Because this is more potent than resveratrol,
I'm wondering what effect this has upon aging and life
expectancies.
In the meantime, here's an article
about aging interventions that I wrote in 2006 but never
published.
5/6/2008: I
Goof Up: Last fall, on the 21st of
September, I declaimed that "My personal guess is that the
stock market is going to recover from its deep, steep dip and
climb higher (with some ups and downs) for the remainder of the
year. I'm also speculating", quoth I, "that we won't go
into a recession before 2009, after the 2008 presidential
election."
Boy, was I wrong! Actually, the stock market
continued to rise to new heights, peaking on October 11th. But
then it did the unthinkable: it plummeted to new lows--like two
tornadoes howling down the same path.
Having lost all of my own August-to-October
ill-gotten gains and a bit more besides, I'm going to try prognosticating
again, along with some ideas about investments. (This will be
changing rapidly over the next few days, so you may want to check
back again.)
Amber is now 20 months old and turning into a
little girl. 
We bought her an outdoor playhouse, and have turned the cardboard
box in which it was packed into an indoor playhouse. Here's Amber
sitting on her throne, with two of her dolls in attendance.
Tommie and I have been busy almost beyond
description. We spend several hours a day playing with her. We're
spoiling Amber wonderfully. Amber has caught every virus that has
found its way into Huntsville, and after years of freedom from
colds and other viruses, Tommie and I are now catching everything
Amber gets. But we're gradually, gradually getting more time. And
Amber will only be these ages once.
4/29/2008: The Day the Earth Stood Still:
For the past few days, the media have been
saturated ad nauseum with Barack Obama and the Reverend Jeremiah
Wright, feeding the crowds bread and circuses. In the meantime,
what may be one of the most important happenings in human history
has passed as unnoticed by the world as the birth of the Son of
Man in the hills of Judea two millennia ago.
There have been several momentous milestones in human
development... the taming of fire, the evolution of language, the development of
writing, the appearance of craftsman and specialization in the early
river-valley city-states... that have transformed what it means to be human.
Today, came announcements of what I believe may possibly lead to the next
millennial-class transformation in human development. Two psychologists, Susanne Jäggi and
Martin Buschkuehl in the Department of Psychology at the University of
Bern, have discovered a training technique that appears to
significantly elevate
fluid intelligence. Further, the technique shows a more-or-less linear
dose-response relationship over a period of 8 12, 17, and 19 days (with 25
minutes of training per day). More...
12-14-2007:
As you can see, there's been a slight change in this title page--a
hyacinth in our December.
9-21-2007:
The last few months have been hectic, to put it mildly. Someone
has to be with Amber around the clock, for four 44-hour shifts a
week. Most of the time, Tommie and I are both engaged with her.
Although we've tried to baby-proof our kitchen-family room,
someone needs to be in attendance whenever she's awake, to make
sure that she doesn't chew through lamp cords or climb up on the
coffee table. During her all-too-brief naps, we either catch up on
sleep ourselves, or service the infrastructure that supports her.
She had her first birthday on August 28th, and is taking steps by
herself and saying a few words. It has its rewards, though. I sing
to Amber and walk her to sleep most nights, since that seems to
work well. I'll forever cherish that little head snuggling into my
shoulder as she heaves sighs and drifts off to sleep. It's rare
and precious in this life that, as adults, we get this kind of
unconditional closeness with another human being. We perform
double handsprings in this life to earn others' approval. With a
baby or a small child, it comes copiously and with no strings
attached. It doesn't last forever, although the closeness of
parent and child can remain for a lifetime.
We've enrolled Amber in a playschool, which she
seems to relish. This is giving us some discretionary time for the
first time since last December. In the meantime, I've found myself
drifting back to posting the science news on a daily basis. My
plans to update the archives have come to naught, as I race from
pillar to post, scrambling to keep up with all my obligations.
One other time-consuming activity that has
eaten whatever bits and pieces of time I've been able to muster is
investment in the stock market. I'm not interested in making money
to buy anything for myself. I'd like to make enough money quickly
enough that I could give some away in ways that I think might be
particularly effective. Of course, optimizing one's investment
strategy is always beneficial. There's a lot I'd like to write
about this that I think might be of interest. Maybe I'll have time
in the next few weeks to present this. In the meantime, here are a
few ideas.
My personal guess is that the stock market is
going to recover from its deep, steep dip and climb higher (with
some ups and downs) for the remainder of the year. I'm also
speculating that we won't go into a recession before 2009, after
the 2008 presidential election. According to the Stock Trader's
Almanac 2007 which analyzes 173 years of data stretching back
to Andrew Jackson's presidency, the third year (e. g., 2007) after
a presidential election is the best year for the stock market (up
10.6% on average), followed by the fourth year (2008) which is
still upward-trending (up 6.7%). The first year (2009) is often a
flat or down year (up 1.6% on average), bottoming during the
second year (2010) and then starting up again (up 3.7% on
average).
Some investments that look good to me right now
may found here.
4-9-2007:
On Monday, August 28th, 2006, our oldest daughter, Lisa, delivered
her first and last child: a baby girl. On the morning of Sunday,
December 3rd, 2006, Lisa died quietly in her sleep, leaving Tommie
Jean and me to rear her three-month-old infant. Since then, it's
been a wildly busy time. Because of this development, I've modified the website, changing it to provide news archives in
various areas of interest rather than a daily posting of 120-130
science news items. I'll still be scanning the same news, but I'll
be saving only items that seem worthy of archiving. Also, as time
permits, I'll generate lists of links to specific archives, such
as "Cancer: Food and Herbs". There is a wealth of
potentially life-saving information in these Science News
articles, and archiving it in specific lists should make this
information much more accessible than it is now.
The first example of these new lists is the
list for "Alzheimers
Disease"
11-1-2006:
Michael McKay has written to say, "In
your page http://www.geocities.com/rnseitz/Definition_of_IQ.html
you start analyzing a Wal-Mart crowd. Your results are already
skewed. The lower IQ people are less likely to be able to get to
Wal-Mart in the first place."
I think that's a good point. I hadn't thought
of that. Offhand, I'd imagine that it might not make too much
difference until the IQ gets well below average, but I don't know.
With the arrival of the new baby, I've been
unable to write additional articles. I'm hoping this will
permit me to update some previous articles dealing with global
warming, investment options, cancer avoidance strategies, etc.
I'd also think that in an adult population, IQ
may not be that good a measure of someone's practical ability to
cope. IQ tests purport to measure certain kinds of mental
abilities having to do with pattern recognition and the potential
to learn. On the other hand, I would imagine that age-related
cognitive decline (for example) could lead to serious degradation
in the ability to do well on an IQ test without necessarily
impairing someone's ability to drive, or to negotiate a shopping
mall. Lack of sleep could slow someone down on IQ-testing-type
activities without implying a lack of innate capabilities under
more favorable circumstances. It's always possible to get an
uncharacteristically low score on an IQ test. And there certainly
are mental gifts that don't show up well in school or on timed IQ
tests. (For example, untreated ADHD can probably interfere with IQ
test performance.)
It seems to me that we all do amazingly well
driving every day. Driving under the influence can lead to
accidents as can reckless or emotional driving and errors in
judgment, but otherwise, I think we drive exceedingly reliably.
6-24-2006:
Here's a 2006
Computer Technology Update.
Beginning today, June 19th,
I'm cutting back somewhat on the content of the daily web pages.
New panels of "Calvin and Hobbes" are no longer
available for download, and I'll have to drop
them. Also, I'm closing the "Words-of-the-Day" in order
to save time that I urgently need for other purposes. In return,
I'll be posting a number of what I think might be important
"essays", that I think you might want to catch. I've
written these and published them in "Gift of Fire" but
haven't gotten around to posting them here.
Reducing the amount of material in the Science
News pages hasn't reduced the amount of time it takes to prepare
the website. I either have to cut back or shut down the science
news service altogether. It takes too much time. I'm going to try
retrenching like this and see if that solves the problem.
Here is an article
I published in the March issue of "Gift of Fire"
reviewing recent articles and books that discuss psychopaths.
more
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