I received an email from a Subscriber that there was a number of posts on Bogleheads about my book “Retire WIth The Wellington Fund”. Some of the posts were questioning why I did this or did that. So I wrote a response, figuring they’d appreciate my point of view for the book.
When I submitted my post it had to be approved by the moderators. Not only was in not approved but I was subsequently PERMANENTLY banned! Not sure how this could construed as ban-worthy but so be it. The world of trigger-fingers to ban things that don’t submit to a certain way of thinking goes on.
I don’t really care as I actually haven’t even gone to that website in years. But now we know Bogleheads seems to be run by ban-happy mods.
Hey folks, the reason I wrote the book is simple… Wellington Fund was founded in 1929. No other funds go back that long, to include the Franklin Income Fund or the Income Fund of America.
As such, it’s interesting to see how it performed during Depression years, Inflation years, low inflation – low growth years. There was no S&P 500 index fund, never mind a balanced index fund back then to consider.
However, I do compare the Wellington to a hypothetical SP 500 with cash scenario to show the devastation of inflation on bonds that occurred during the late 60s to early 80s.
Conversely, the DEFLATION of the 30’s helped Wellington immensely because of its bond exposure, whereas the SP got stomped. I also look at Japan in 1990s, comparing the Nikkei to the Japanese 10 year. The reason I do that is to emphasize that bonds MAY save you in low-inflation/deflation times, but they’ll kill you during inflation.
For retirees it’s simply not about growth anymore. Thus a 10 year time frame of growth matters not. It’s drawdown. And Wellington held up just fine…most of the time. Again, not during the 66-82 years. I suggest in the book that people make an assessment of where we are going in the future, more inflation or less, ala Japan. If we go Japan Wellington should be just fine for a retiree. If we go to a high inflation, Wellington won’t work well. I personally believe Japan-lite is our future.
As far as editing, all my books are self-published. I had 4 of my Youtube subscribers edit this one for me. Not professionals and certainly nothing fancy. But, frankly, I don’t care. It’s the ideas I’m trying to convey… for people to say “hmmm…never thought of it like that…” That’s all that matters. Encourage critical thinking. ========================
Oh, needed to add the reason I used Wellington as opposed to Dodge and Cox or other funds is that I like Vanguard. I worked there from 98-00, got to shake Bogle’s hand, he signed my book “Common Sense on Mutual Funds’ and as such I favor Vanguard over all else.
Secondly, in my career, I’ve had a chance to meet a couple of the PMs over at Wellington too. They were exactly what you’d expect from folks who align with Vanguard. Humble, passionate and no-nonsense. Lastly, will Vanguard perform the best? nope. Will you know that in advance? nope