hoover

Index ETFs Have the Edge Over Actively Managed CEFs

Neither index ETF's nor actively managed ETF's have been around long enough to compare generally with CEF's, which have been around for a long time. The only problem with managed funds (CEF's, OEF's or managed ETF's) is that the investor doesn't know what advantage if any he is getting from "management" fees. Managed funds churn a lot of stocks. They collect nice fees. A manager with today's banker's scruples, may run a "managed" fund by using a basic index fund approach, collecting kickbacks on stock trades due to useless churning, and collect a mangement fee for doing nothing. Using an index approach for the core investments in the "managed" fund, assures that the fund doesn't perform much worse than the general market -- which IS the typical performance of managed funds. The investor is simply paying fees for nothing in return -- but I am not suggesting all of them are run like that.

Chinese Stock Market Bottoms: What Should U.S. Investors Do?

China is a good bet to become the future powerhouse economy of the world. The first thing wrong with those that disparage China is labels -- Communist and Capitalist. China is a conservative capitalist state with little debt, and a government run by non-elected representatives from various regions of China which pick the President (or equivalent). While semi-dictatorial and potentially dangerous, the history of Chinese culture has not been militarily very aggressive toward other countries. By contrast, the United States has been a capitalist-socialist state with an irresponsible penchant for maximizing debt, leverage, and pyramid schemes for the past twenty years. It is hopelessly paralyzed by citizens in debt up their eyeballs, corporations that rely continuously on borrowed money for operating capital, and a bankrupt government. While democratic in voting, the government is entirely run by lobbyists that have only their own self interests at heart. Economic recovery is being attempted by piling on even more debt -- which seems highly risky.