I always like John Lim articles. Thought provoking. I do a 20% international allocation mainly because that seemed like what people were recommending on bogleheads. The international allocation suggested here feels like very bold advice. Much of the rationalization comes from the high CAPE. The CAPE is something I struggle with. Some authors treat it like dogma and adjust their holdings because of it. But other authors write that basically it stopped working as a predictor as soon as it was discovered. The market isn’t a math problem. There is no guarantee that it will do what you expect based on a math problem. It is an irrational morass of human emotion. Maybe valuations are high, but what if the US market keeps rocketing up for 5 more years before it reverts to the mean. I mean, a few days ago, when the market dropped just 1ish %, there seemed to be plenty of dip buyers yet. Or, with reopening of businesses and improved earnings, won’t the P/E ratio improve anyways, without a massive bubble burst.
Comments
I always like John Lim articles. Thought provoking. I do a 20% international allocation mainly because that seemed like what people were recommending on bogleheads. The international allocation suggested here feels like very bold advice. Much of the rationalization comes from the high CAPE. The CAPE is something I struggle with. Some authors treat it like dogma and adjust their holdings because of it. But other authors write that basically it stopped working as a predictor as soon as it was discovered. The market isn’t a math problem. There is no guarantee that it will do what you expect based on a math problem. It is an irrational morass of human emotion. Maybe valuations are high, but what if the US market keeps rocketing up for 5 more years before it reverts to the mean. I mean, a few days ago, when the market dropped just 1ish %, there seemed to be plenty of dip buyers yet. Or, with reopening of businesses and improved earnings, won’t the P/E ratio improve anyways, without a massive bubble burst.
Post: Leaving the Country
Link to comment from July 22, 2021