bigmoney

Why the S&P 500's EPS Calculation Method Is Wrong

this article is requiring a bit more thinking than I am prepared to do at the moment, but it the math behind the S&P 500 index does seem suspicious. Same with the DOW. It's these reasons that make me hesitant to buy "index" funds, as they appear to be somewhat arbitrary, but I do for lack of anything better to do. In this respect, I suspect they have an element of ponzi / pyramid. Even PE ratios for individual stocks are not linear as they can balloon as earnings approach zero.

Fear of Losing Jobs: The Biggest Obstacle to Recovery

>> I will probably rent the $2500 apartment for the next 3 months instead of on a monthly basis

3 months is not a long lease. Where I live, they want to get you into 12 month lease. Either way, maybe we need government bailouts for distressed renters. It's ironic that renters are subjected to much more fiscal discipline than buyers.

CDS: The Sabotaging Asset

>> So, what do we do, bail them out or help folks keep their (overpriced) homes? I say, the latter.

Didn't Ben Bernanke (Helicopter Ben) say something about dropping cash out of helicopters to combat deflation? I'm still waiting for those helicopters. Berlin Airlift style cash-drop's over sprawling suburbs of McMansions with granite countertops and swimming pools would definitely improve the plight of the American people.

The Perils of Long-Term Investing

Many investors are holding S&P 500, or some other market cap index fund. I am not sure how often they re-balance, but I think its annually. I doubt there is very many true buy & holder's. Even so, most investors lack the training, time, energy, and access to information to dump the losers in a timely manner, so the buy & hold (via mutual fund) is the best they can do.

Is the AIG Deal Death Blow to the ETF Industry?

I didn't have time to read this entire posting, but when I studying Investing 101 a few years ago, I was concerned about top heavy financials in the market cap weighted mutual fund / ETF products. Equi-sector fund investing is easy to do now with ETFs, but that works best for large caps. As far as I know, there's no equivalent of SPDRs in mid & small cap. Even better would be additional sector products to be available that are globally diversified, or at least western europe, Japan, etc.