Ineptocracy... Summer Wind

• Aug 20 ECRI's Annual WLI Growth Rate At 41-Week High; SPY At Bull Market High
• Aug 13 2012 Budget Deficit Approaches $1T: Portfolio Positioning
• Aug 10 S&P500 Earnings Adjusted for Inflation from 1900 to 2012 
• Aug 9 Official London Olympic Sponsors List
  

-------- Original Message --------

Subject:	Ineptocracy... Summer Wind
Date:	Thu, 23 Aug 2012 13:09:08 -0700
From:	Jas Jain

Ineptocracy:

A system of government where the least capable to lead are elected by the least capable of producing, and where the members of society least likely to sustain themselves or succeed, are rewarded with goods and services paid for by the confiscated earnings of a diminishing number of producers.

 

"Indian industrial production slid in June for the third time in four months, with output of capital goods plunging the most on record."

~ Bloomberg, August 9
...

Summer Wind

Songwriters: MERCER, JOHNNY / MAYER, HENRY / BRADTKE, HANS

The summer wind, came blowin in - from across the sea
It lingered there, so warm and fair - to walk with me
All summer long, we sang a song - and strolled on golden sand
Two sweethearts, and the summer wind

Like painted kites, those days and nights - went flyin by
The world was new, beneath a blue - umbrella sky
Then softer than, a piper man - one day it called to you
And I lost you, to the summer wind

The autumn wind, and the winter wind - have come and gone
And still the days, those lonely days - go on and on
And guess who sighs his lullabies - through nights that never end
My fickle friend, the summer wind

- The 1966 recording by Frank Sinatra is a gem.

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Here is a very important article to understand:

• Bill Gross Death of Equities: The Implications of his "The Cult of Equity is Dying" Article

I wrote that article where I said a 50:50 portfolio will probably do about 5.0% a year for 2.0% "real return" if you assume 3.0% inflation as opposed to Gross predicting zero real return.  Since I wrote the article, John Bogle, founder of Vanguard, gave the same 5% as his target on CNBC the other day.  Earlier, Jeremy Siegel defended his 6.6% real return by saying the market saw a similar 6.6% real return in the 1800s.  BTW, one reason I have had the REIT fund in my core portfolio for over a decade is I expected inflation in real assets so rents and rental property should keep up with inflation better than stocks. (The REIT index fund is up 311% since 1999 while the S&P500 is only up 45% over the same period.)