First an administrative note. The blog website will undergo technical maintenance this weekend. If you see something weird, pardon the dust. If all goes well, it will get a fresh look.
Second, if you are still using Google Reader to read this blog, I hope you already found an alternative, because Google Reader is going to shut down on July 1st. That’s next Monday. For my own reading other blogs, I chose Feedly cloud as the backend, Reeder app on iPhone, and gReader app on Android. Reeder doesn’t support Feedly cloud just yet but it will soon.
This week we say goodbye (I hope for not too long) and good luck to blogger Mike who used to write at Long-Term Returns. Although I never corresponded with Mike personally I liked and linked to many of his posts. Mike took down his blog and his Twitter account last weekend. He had mentioned he was passively looking for a job with a hedge fund because he had expertise in an area that a hedge fund could use and that working for a hedge fund would get him faster to his number.
If Mike turned off the light because he found the job he wanted, I feel really happy for him. He can always come back to blogging after he makes his number. I also like how he’s able to set priorities. When a hobby, however addictive, potentially gets in the way of a more important goal, it’s let go, just like that. I need to learn from him.
This also shows the society’s inefficiency in resource allocation (or efficiency depending on which way you look at it). I imagine if Mike is able to get paid the same incremental income he’d rather answer people’s questions on his blog than working for a hedge fund. His answers were very valuable to the people who asked those questions but they weren’t compensating Mike adequately for value provided. At the very least, not enough people who can benefit from Mike’s help are able to find Mike. As a result, we lose Mike to an entity that is able to find those who value Mike’s effort more.
I read these interesting articles this week:
Gold continues its free fall by Larry Swedroe at CBS MoneyWatch
Momentum cuts both ways. When gold price was going up, it kept making new highs. Now it’s free-falling. Do I hear $800? Or $400?
Gay marriage: more taxes, more benefits by Liz Weston at Ask Liz Weston
I agree with the more benefits part but I disagree with the more taxes part. A married gay couple filing jointly will pay more taxes only if the two of them have similar income. If one works and the other doesn’t, they will pay less taxes, as the title of this CNNMoney article says: Marriage ruling could save same-sex couples thousands.
How Warren Buffett would handle today’s market by Larry Swedroe at CBS MoneyWatch
I’m guessing doing nothing because the recent movements are simply too small for Warren Buffett. He invests in individual stocks anyway, not a diversified portfolio of index funds and ETFs.
Three fatal flaws of risk-profile questionnaires by Allan Roth at CBS MoneyWatch
All valid points. What better tool we should use in its place is the question.
How Do GNMA Bonds Work? by Mike Piper at Oblivious Investor
Unfortunately a GNMA fund doesn’t get you out of interest rate risk either. Actually it can be worse than a regular bond fund.
401(k)s Stall, Post-Auto Enrollment at Squared Away Blog
Auto-enrollment lifted the average participation rate but not necessarily the savings rate. The author asked "Now what?" I say increase the default contribution rate, and increase the contribution rate required to get a full match. Instead of matching 50% on 6%, make it matching 30% on 10%.
Higher CD Rates at First Republic Bank in Several States by Ken Tumin at DepositAccounts.com
I heard First Republic Bank offers great customer service. High CD rates make it even better.
Debt Relief Firms Are Charging for Free Programs by Ann Carrns at New York Times Bucks Blog
I actually don’t have a problem with this. The government programs are free but finding them doesn’t have to be free. It’s like hiring a tour guide. The places are free to see but a paid guide will show you which ones are worth seeing.
[Photo credit: Flickr user Karen Cropper]