Stop worrying about the 4% rule

[Metalcat]

Somewhere along the line Sam/Financial Samuri went from writing quality articles to click-bait trash.  His early approach was to use math to make sense of finances and retirement.  Now his posts are littered with mathematical mistakes that I can only describe them as gross-negligence.  And he doesnt’ seem to care.  His articles are the epitome of confirmation bias - he starts with some conclusion (that will get clicks) and then cherry-picks odd datasets that will help him reach that conclusion.,

He monetized his blog Right around when he decided that he was bored with FIRE and didn’t like the ‘constraints’ of living off a couple million in a HCOL (SF Bay) area.

I've said this before when Samurai gets brought up, what I think is unfortunate is that what's driving his crap is really worth discussing.

This guy did it, he managed to FIRE, and yet, he's not happy with it and he finds its not enough, and would rather turn the fire hose of cash back on because working for him is better than living frugally compared to those around him.

He's basically the opposite of MMM who FIRED on far less, built a really exciting and rich life, ended up with massive amounts of extra money, and still really enjoys his frugal lifestyle.

But what made one of them FIRE into his best life and the other feel so let down by the whole experience? What's the cautionary tale here? I'm really quite fascinated by the whole thing, but now that he's just writing nonsense click-bait, it's hard to parse anything meaningful behind it.

It's really too bad, because I think there would be a lot of value in seeing inside why FIRE doesn't work out for some people.

[nereo]

Somewhere along the line Sam/Financial Samuri went from writing quality articles to click-bait trash.  His early approach was to use math to make sense of finances and retirement.  Now his posts are littered with mathematical mistakes that I can only describe them as gross-negligence.  And he doesnt’ seem to care.  His articles are the epitome of confirmation bias - he starts with some conclusion (that will get clicks) and then cherry-picks odd datasets that will help him reach that conclusion.,

He monetized his blog Right around when he decided that he was bored with FIRE and didn’t like the ‘constraints’ of living off a couple million in a HCOL (SF Bay) area.

I've said this before when Samurai gets brought up, what I think is unfortunate is that what's driving his crap is really worth discussing.

This guy did it, he managed to FIRE, and yet, he's not happy with it and he finds its not enough, and would rather turn the fire hose of cash back on because working for him is better than living frugally compared to those around him.

He's basically the opposite of MMM who FIRED on far less, built a really exciting and rich life, ended up with massive amounts of extra money, and still really enjoys his frugal lifestyle.

But what made one of them FIRE into his best life and the other feel so let down by the whole experience? What's the cautionary tale here? I'm really quite fascinated by the whole thing, but now that he's just writing nonsense click-bait, it's hard to parse anything meaningful behind it.

It's really too bad, because I think there would be a lot of value in seeing inside why FIRE doesn't work out for some people.

I see what you see, poster formerly known as Malkynn.  And the juxtaposition between Pete and Sam does fascinate me as well.
But where I really get angry at Financial Samuri is what I call blogging malpractice - using absolutely ludicrous data to prove his point*.

Here's just one example:  In his case for why a FIREd couple with one toddler cannot live comfortably on 'just' $200k/year of investment income, he inexplicably i) ignored forever $750k in retirement accounts as 'inaccessable', ii) calculated $24k/year in college savings forever and iii) assumed over $10k for child care forever.  Ironically his sample 'budget' showed a slight surplus despite a huge amount of fat.  What's head-smackingly ridiculous (and why I call it "financial-blogging malpractice") is that these calculations assume $504k invested towards higher education, the assumption that two adults with no jobs still need considerable childcare (and that childcare will not go away in a few years when toddler goes to elementary school) and that, even at 15 years later that $750k in retirement accounts should be meaningless (at a minimum it makes saving $504k for your only child's college fund a bit redundant, no?)

And that's just one example.  As Telecaster and others have pointed out, he's made a recent habit of using math to obfuscate rather than enlighten.

[Metalcat]

Somewhere along the line Sam/Financial Samuri went from writing quality articles to click-bait trash.  His early approach was to use math to make sense of finances and retirement.  Now his posts are littered with mathematical mistakes that I can only describe them as gross-negligence.  And he doesnt’ seem to care.  His articles are the epitome of confirmation bias - he starts with some conclusion (that will get clicks) and then cherry-picks odd datasets that will help him reach that conclusion.,

He monetized his blog Right around when he decided that he was bored with FIRE and didn’t like the ‘constraints’ of living off a couple million in a HCOL (SF Bay) area.

I've said this before when Samurai gets brought up, what I think is unfortunate is that what's driving his crap is really worth discussing.

This guy did it, he managed to FIRE, and yet, he's not happy with it and he finds its not enough, and would rather turn the fire hose of cash back on because working for him is better than living frugally compared to those around him.

He's basically the opposite of MMM who FIRED on far less, built a really exciting and rich life, ended up with massive amounts of extra money, and still really enjoys his frugal lifestyle.

But what made one of them FIRE into his best life and the other feel so let down by the whole experience? What's the cautionary tale here? I'm really quite fascinated by the whole thing, but now that he's just writing nonsense click-bait, it's hard to parse anything meaningful behind it.

It's really too bad, because I think there would be a lot of value in seeing inside why FIRE doesn't work out for some people.

I see what you see, poster formerly known as Malkynn.  And the juxtaposition between Pete and Sam does fascinate me as well.
But where I really get angry at Financial Samuri is what I call blogging malpractice - using absolutely ludicrous data to prove his point*.

Here's just one example:  In his case for why a FIREd couple with one toddler cannot live comfortably on 'just' $200k/year of investment income, he inexplicably i) ignored forever $750k in retirement accounts as 'inaccessable', ii) calculated $24k/year in college savings forever and iii) assumed over $10k for child care forever.  Ironically his sample 'budget' showed a slight surplus despite a huge amount of fat.  What's head-smackingly ridiculous (and why I call it "financial-blogging malpractice") is that these calculations assume $504k invested towards higher education, the assumption that two adults with no jobs still need considerable childcare (and that childcare will not go away in a few years when toddler goes to elementary school) and that, even at 15 years later that $750k in retirement accounts should be meaningless (at a minimum it makes saving $504k for your only child's college fund a bit redundant, no?)

And that's just one example.  As Telecaster and others have pointed out, he's made a recent habit of using math to obfuscate rather than enlighten.

Agreed, what he's resorted to is really tragic, since he's decided in his rejection of FIRE, to also reject his own usefulness to others and absolutely destroy his own legacy.

Truly fascinating.

[SwordGuy]

I thought it was bad when FS turned into a clickbait whore of an author.

But getting all WHINY about it was the last straw for me.   

I can't abide whiny people -- they bring out my inner Lizzie Borden -- and especially whiny rich people who whine about how poor they are.

It's pretty clear he wants to hang out with "the VIPs" and can't pull it off on his budget.

Everyone has an ego and everyone attaches that ego to something that makes them feel good about themselves.    It's real important to learn what your ego is attached to and move it to something else if that location isn't good for you.

[vand]

While we debate and with each other disagree about plenty of stuff on these boards, I think we are all united in saying that FS has morphed into a less than worthless piece of unprintable trash whose current articles are a disingenuous, misleading, trolling-baiting shitshow.

Normally I would say "good luck to the guy" but on this occasion if it were possible I would have him blacklisted from the personal finance community.

[nereo]

While we debate and with each other disagree about plenty of stuff on these boards, I think we are all united in saying that FS has morphed into a less than worthless piece of unprintable trash whose current articles are a disingenuous, misleading, trolling-baiting shitshow.

Normally I would say "good luck to the guy" but on this occasion if it were possible I would have him blacklisted from the personal finance community.

A rare moment when I'm in full agreement with you @vand
:-)

[AdrianC]

Bill Bengen Revisits The 4% Rule Using Shiller's CAPE Ratio, Michael Kitces's Research
https://www.fa-mag.com/news/choosing-the-highest--safe--withdrawal-rate-at-retirement-57731.html?section=40

"In summary, based on the earlier work of Michael Kitces, I have presented a tabular method to select an initial withdrawal rate for retirement portfolios, based on both recent inflation and stock market valuations. It exhibits a wide range of choices, between the “worst case” of 4.5% and a high of 13%, representing the full range of historically successful withdrawal rates. It is simple to use, though right now it applies only to tax-advantaged portfolios with a desired longevity of 30 years."

[Monkey Uncle]

Bill Bengen Revisits The 4% Rule Using Shiller's CAPE Ratio, Michael Kitces's Research
https://www.fa-mag.com/news/choosing-the-highest--safe--withdrawal-rate-at-retirement-57731.html?section=40

"In summary, based on the earlier work of Michael Kitces, I have presented a tabular method to select an initial withdrawal rate for retirement portfolios, based on both recent inflation and stock market valuations. It exhibits a wide range of choices, between the “worst case” of 4.5% and a high of 13%, representing the full range of historically successful withdrawal rates. It is simple to use, though right now it applies only to tax-advantaged portfolios with a desired longevity of 30 years."

O.K., so I read through very quickly, and may be missing something.  But at first glance it appears that he is basing everything on CAPE values from 1926 through 1990.  CAPE behaves totally differently now that it did then.  He is considering a CAPE value over 20 to be overvalued.  Since the early 1990s, CAPE has only dipped below 20 during the Great Recession of 2008-09.  It appears that he makes no acknowledgement of the huge change in behavior of CAPE in the last 30 years.  Of course, if it were possible to take this change into account, it would argue for even greater withdrawal rates.  So perhaps he is being conservative.  But still, I have trouble giving the analysis much credence when he doesn't even acknowledge the fact that his metric of choice has been wildly inconsistent over the decades.

[TomTX]

Bill Bengen Revisits The 4% Rule Using Shiller's CAPE Ratio, Michael Kitces's Research
https://www.fa-mag.com/news/choosing-the-highest--safe--withdrawal-rate-at-retirement-57731.html?section=40

"In summary, based on the earlier work of Michael Kitces, I have presented a tabular method to select an initial withdrawal rate for retirement portfolios, based on both recent inflation and stock market valuations. It exhibits a wide range of choices, between the “worst case” of 4.5% and a high of 13%, representing the full range of historically successful withdrawal rates. It is simple to use, though right now it applies only to tax-advantaged portfolios with a desired longevity of 30 years."

O.K., so I read through very quickly, and may be missing something.  But at first glance it appears that he is basing everything on CAPE values from 1926 through 1990.  CAPE behaves totally differently now that it did then.  He is considering a CAPE value over 20 to be overvalued.  Since the early 1990s, CAPE has only dipped below 20 during the Great Recession of 2008-09.  It appears that he makes no acknowledgement of the huge change in behavior of CAPE in the last 30 years.  Of course, if it were possible to take this change into account, it would argue for even greater withdrawal rates.  So perhaps he is being conservative.  But still, I have trouble giving the analysis much credence when he doesn't even acknowledge the fact that his metric of choice has been wildly inconsistent over the decades.

Modern GAAP accounting has noticeably tightened down in recent decades - with the likely effect of pushing down reported earnings compared to how they were reported historically.  "Earnings" reported today are significantly different than how the same exact operation would have reported earnings in 1985.

Unless these changes are accounted for, CAPE is questionable and would tend to report higher values in more recent years.

[Retire-Canada]

Unless these changes are accounted for, CAPE is questionable and would tend to report higher values in more recent years.

Yes. This article is worth a read if the topic interests you. It discusses CAPE, the change in accounting methods and the likelihood of reversion to historical mean levels.

http://www.philosophicaleconomics.com/2013/12/shiller/

[AdrianC]

Bill Bengen Revisits The 4% Rule Using Shiller's CAPE Ratio, Michael Kitces's Research
https://www.fa-mag.com/news/choosing-the-highest--safe--withdrawal-rate-at-retirement-57731.html?section=40

"In summary, based on the earlier work of Michael Kitces, I have presented a tabular method to select an initial withdrawal rate for retirement portfolios, based on both recent inflation and stock market valuations. It exhibits a wide range of choices, between the “worst case” of 4.5% and a high of 13%, representing the full range of historically successful withdrawal rates. It is simple to use, though right now it applies only to tax-advantaged portfolios with a desired longevity of 30 years."

O.K., so I read through very quickly, and may be missing something.  But at first glance it appears that he is basing everything on CAPE values from 1926 through 1990.  CAPE behaves totally differently now that it did then.  He is considering a CAPE value over 20 to be overvalued.  Since the early 1990s, CAPE has only dipped below 20 during the Great Recession of 2008-09.  It appears that he makes no acknowledgement of the huge change in behavior of CAPE in the last 30 years.  Of course, if it were possible to take this change into account, it would argue for even greater withdrawal rates.  So perhaps he is being conservative.  But still, I have trouble giving the analysis much credence when he doesn't even acknowledge the fact that his metric of choice has been wildly inconsistent over the decades.

On the flip side, half his example portfolio is intermediate treasuries. Good luck with that.

The Bogleheads thread on it is quite interesting:
https://www.bogleheads.org/forum/viewtopic.php?f=10&t=326680

I especially liked the contributions by "vineviz"

If the the expectation of real yield from half the portfolio is -1.5%...

[kenmoremmm]

https://www.nytimes.com/interactive/2020/12/16/magazine/russia-climate-migration-crisis.html
notable quote and food for thought:

Marshall Burke projects that over the next 80 years, per capita G.D.P. in the United States will drop by 36 percent compared to what it would be in a nonwarming world, even as per capita G.D.P. in Russia will quadruple. A recent study led by researchers at Columbia University found that a disruption in U.S. agriculture would quickly propagate throughout the world. After just four years of a Dust Bowl-like event — a time when some crop yields dropped by 60 percent — global wheat reserves would be cut by nearly a third, and U.S. reserves would be almost entirely gone. And as the livability and capacity of American land wanes, U.S. influence in the world may fade along with it.

[waltworks]

https://www.nytimes.com/interactive/2020/12/16/magazine/russia-climate-migration-crisis.html
notable quote and food for thought:

Marshall Burke projects that over the next 80 years, per capita G.D.P. in the United States will drop by 36 percent compared to what it would be in a nonwarming world, even as per capita G.D.P. in Russia will quadruple. A recent study led by researchers at Columbia University found that a disruption in U.S. agriculture would quickly propagate throughout the world. After just four years of a Dust Bowl-like event — a time when some crop yields dropped by 60 percent — global wheat reserves would be cut by nearly a third, and U.S. reserves would be almost entirely gone. And as the livability and capacity of American land wanes, U.S. influence in the world may fade along with it.

This is the sort of odd mixing/misuse of percentages that statisticians *hate*.

Russia's per capital GDP is about $11,000. The US is $62,000. So just off the bat, you're comparing a developing country with a developed one, and growth rates for GDP are generally much lower for developed economies.

Next, we've got that 36 percent number hanging out in space. Annual GDP growth in the US in recent times (say, past 20-30 years) has averaged in the ballpark of 3%, which means in 80 years the US economy (absent climate change issues) will be roughly 10 times the size it is now (per capita GDP around $650k).

Knock 36 percent off and you're at $416k, so a bit less than 7 times as big as today.

So here's your new headline: With climate change, US GDP will only septuple, while Russia's will quadruple.

I'll also note that quadrupling Russia's GDP over 80 years implies a growth rate of 1.75 percent, which is AWFUL when starting from their low base.

Now, the authors might not be communicating well, but they're *journalists*. It's their *job* to make this understandable and either they don't get it themselves, or they can't accurately communicate it.

Note that none of this means I disagree about climate change being a big, big problem.

-W

[pecunia]

Why does there have to be a dust bowl event?  People are already looking at the water issues in the West and Great Plains.  I figure in 80 years, people ought to have the wherewithal to desalinate and pump water to where it is needed increasing agricultural output.

[waltworks]

80 year timelines are tough. Imagine trying to predict what our current world and it's problems would be like in 1940.

-W

[nereo]

Why does there have to be a dust bowl event?  People are already looking at the water issues in the West and Great Plains.  I figure in 80 years, people ought to have the wherewithal to desalinate and pump water to where it is needed increasing agricultural output.

We have that now.  Arguably we’ve had that for decades at commercial scale.  The challenge that remains is that these methods have substantial costs when you are talking about irrigating millions of acres or supplying millions of acres, whereas rainfall costs nothing. 

There are technological gains to be made, for certain - but I don’t ever see desalination or pumping water thousands of water to have a negligible cost either.

[waltworks]

It's also worth noting that more than half of the grain grown in the US goes to feed animals. So what you might see is more of a dramatic shift in diets.

-W

[Metalcat]

It's also worth noting that more than half of the grain grown in the US goes to feed animals. So what you might see is more of a dramatic shift in diets.

-W

Or efficient synthetized meat production. All sorts of possibilities.

[mjr]

*As much of a hard time as I give the metric system, conversions like this are so much easier than the standard unit equivalents.

Rofl.  Only a yank could try and give the  metric system a hard time.  The ONLY bad thing about the metric system is that it was invesnted by the French.  Get with the programme, America.

[nereo]

*As much of a hard time as I give the metric system, conversions like this are so much easier than the standard unit equivalents.

Rofl.  Only a yank could try and give the  metric system a hard time.  The ONLY bad thing about the metric system is that it was invesnted by the French.  Get with the programme, America.

...and I snort everytime some foreigner uses the term ‘yank’ to describe someone from the US - particularly someone from the Midwest.  WTF?

[mjr]

I'm well aware that "yank" to you good selves means someone from the tri-state area, but that won't stop us calling you that as a collective.

At least I didn't call you a 'septic'.

[nereo]

I'm well aware that "yank" to you good selves means someone from the tri-state area, but that won't stop us calling you that as a collective.

At least I didn't call you a 'septic'.

‘Septoic’?  Please explain...

And no - even people from the “tri-state area’ are not referred to as ‘yanks’ (or even yankees).  Members and fans of that particular sports franchise, but that’s about it.  Half of my family is from NYC, and I”ve never heard them be called nor call anyone from their area ‘yanks’ before. 

It’s a word we stopped using over a century ago. Every time I hear it I think “can we call someone from England a ‘Red-Coat’ now??”

[MDM]

To foreigners, a Yankee is an American.
To Americans, a Yankee is a Northerner.
To Northerners, a Yankee is an Easterner.
To Easterners, a Yankee is a New Englander.
To New Englanders, a Yankee is a Vermonter.
And in Vermont, a Yankee is somebody who eats pie for breakfast.

- Yankee | National Geographic Society

[nereo]

To foreigners, a Yankee is an American.
To Americans, a Yankee is a Northerner.
To Northerners, a Yankee is an Easterner.
To Easterners, a Yankee is a New Englander.
To New Englanders, a Yankee is a Vermonter.
And in Vermont, a Yankee is somebody who eats pie for breakfast.

- Yankee | National Geographic Society

That is awesome.  And well said.  And now I want pie.

[EscapeVelocity2020]

80 year timelines are tough. Imagine trying to predict what our current world and it's problems would be like in 1940.

-W

On top of that, the Pandemic should be considered a Black Swan event (an unpredictable occurrence in which investors typically fear losing 50%-ish value of risk-exposed diversified investments).  And yet here we are, about 1 year later from the beginning of the infection spread and subsequent crises (unemployment, morbidity, bunkruptcy/evictions, supply chain disruptions...), with the S&P500 Index up 10 - 20%.  This is either the "Final Bubble" (The US Fed will hit the limit on printing money), or else capitalism is broken and risk is dead.  Right now, the 'risk is dead theory' seems to be working out pretty well for those buying and holding TSLA :)

[mjr]

‘Septoic’?  Please explain...

https://www.macquariedictionary.com.au/resources/aus/word/map/search/word/seppo/Australia/

It's not even deregatory, it's said with affection.

One thing that defines Americans is their collective ignorance of the rest of the world, including what the ROTW thinks of them.

Just like their pig-headed refusal to adopt the metric system despite its obvious superiority to ye-olde imperial units (albeit themselves bastardised by Yanks),  which is what my post was about.

[SwordGuy]

‘Septoic’?  Please explain...

https://www.macquariedictionary.com.au/resources/aus/word/map/search/word/seppo/Australia/

It's not even deregatory, it's said with affection.

One thing that defines Americans is their collective ignorance of the rest of the world, including what the ROTW thinks of them.

Just like their pig-headed refusal to adopt the metric system despite its obvious superiority to ye-olde imperial units (albeit themselves bastardised by Yanks),  which is what my post was about.

Don't go getting all uppity and thinking you're the special target of our collective ignorance  -- we're totally ignorant about gobs of things in our own country, too.   Like history, how our government is supposed to work, arithmetic, reading, logic, philosophy, oh, heck, pretty much anything but (other people playing) sports, celebrity sleaze and when the next sale is.

[nereo]

‘Septoic’?  Please explain...

https://www.macquariedictionary.com.au/resources/aus/word/map/search/word/seppo/Australia/

It's not even deregatory, it's said with affection.

One thing that defines Americans is their collective ignorance of the rest of the world, including what the ROTW thinks of them.

Just like their pig-headed refusal to adopt the metric system despite its obvious superiority to ye-olde imperial units (albeit themselves bastardised by Yanks),  which is what my post was about.

Interesting.  At the same time, it’s notable how many treat ‘Americans’ as some monolithic group with universally-accepted opinions and values.  There’s some 330 million of us, and we’re among the more diverse countries on the planet. We can’t even have a consensus who amongst us should be considered “American”. 

I’ve no objections to the metric system and use it in my own work (as does every other person I work with). The imperial system has certain areas where it’s still useful, like maritime navigation.

[waltworks]

To be fair (I say this as a metric partisan) the whole point of metric was to make arithmetic easier. In the era when basically nobody does any calculations by hand, the advantage is gone.

-W

[SwordGuy]

Why is it so much skin off your nose that american children, on the far side of the planet, learn two sets of units in school instead of one?

I'm an American.  Do American children really learn two sets of units instead of one?

I'll stipulate the following:

1) Most American students have a teacher attempt to teach both Metric and Imperial units.

I've seen little evidence that most Americans can actually use both sets of measurements fluently.   I'm not convinced that most Americans can use even one set of units fluently.

Here's a math puzzle for you all:

Joe and Mary dig a hole.  They set a rod on the bottom of the hole and hold it upright.   The rod extends 6 feet out of the hole.  How deep is the hole?

[Metalcat]

I've seen little evidence that most Americans can actually use both sets of measurements fluently.   I'm not convinced that most Americans can use even one set of units fluently.

I mean if most americans cannot use even one set of units, that's not a question of adopting the metric system, just that we have a terrible education system combined with a vastly under appreciated problem with innumeracy in our population.

In my experience, people who are able to work fluently in feet, gallons and pounds can generally do just about as well in meters, liters, and kilos. The two places I think americans are pretty uncomfortable with metric both aren't in doing math but in figuring out the impact of a number in non-standard units without converting it into the units we're familiar with: If you tell many of us (including me) a distance in kilometers, I have to mentally convert to miles before I have a gut sense of "how far is that" and if you tell me a temperature in celsius I have to mentally convert before I have a gut sense of "how cold is that"

Oh and the answer to the math question is that the hole is 3.2 meters deep.

Well...a lot more of those Americans would easily understand one system if that one system was metric.

It's really easy.

[nereo]

I've seen little evidence that most Americans can actually use both sets of measurements fluently.   I'm not convinced that most Americans can use even one set of units fluently.

I mean if most americans cannot use even one set of units, that's not a question of adopting the metric system, just that we have a terrible education system combined with a vastly under appreciated problem with innumeracy in our population.

In my experience, people who are able to work fluently in feet, gallons and pounds can generally do just about as well in meters, liters, and kilos. The two places I think americans are pretty uncomfortable with metric both aren't in doing math but in figuring out the impact of a number in non-standard units without converting it into the units we're familiar with: If you tell many of us (including me) a distance in kilometers, I have to mentally convert to miles before I have a gut sense of "how far is that" and if you tell me a temperature in celsius I have to mentally convert before I have a gut sense of "how cold is that"

Oh and the answer to the math question is that the hole is 3.2 meters deep.

Well...a lot more of those Americans would easily understand one system if that one system was metric.

It's really easy.

Wait... aren’t you Canadian?

[SwordGuy]

I've seen little evidence that most Americans can actually use both sets of measurements fluently.   I'm not convinced that most Americans can use even one set of units fluently.

I mean if most americans cannot use even one set of units, that's not a question of adopting the metric system, just that we have a terrible education system combined with a vastly under appreciated problem with innumeracy in our population.

In my experience, people who are able to work fluently in feet, gallons and pounds can generally do just about as well in meters, liters, and kilos. The two places I think americans are pretty uncomfortable with metric both aren't in doing math but in figuring out the impact of a number in non-standard units without converting it into the units we're familiar with: If you tell many of us (including me) a distance in kilometers, I have to mentally convert to miles before I have a gut sense of "how far is that" and if you tell me a temperature in celsius I have to mentally convert before I have a gut sense of "how cold is that"

Oh and the answer to the math question is that the hole is 3.2 meters deep.

Correct on the depth of the hole.

I don't think our education system is terrible so much as too many Americans pride themselves on not learning what they are taught.

[solon]

Here's a math puzzle for you all:

Joe and Mary dig a hole.  They set a rod on the bottom of the hole and hold it upright.   The rod extends 6 feet out of the hole.  How deep is the hole?

I'm lost. The rod is 6 feet longer than the depth of the hole. How do we know the depth of the hole?

[pecunia]

I'm sticking with the British Imperial system for electricity.  I will not give up my watts, amps and volts.  I will never even look at a meter that measures Metric VARS.

Here's something else.  These are bad times.  The world is having a pandemic.  Yet the market returns are good.  Is this an anomaly or proof of the validity of the 4 percent rule?

[Metalcat]

I was just joking that metric is way easier and in a shitty educational system, wouldn't it be better to teach a much, much easier system?

I mean, it really is stupidly easy.

As for the pandemic proving the 4% rule, doesn't it also prove how irrational the markets are?

It doesn't make me more confident in the predictability of the markets, but I also don't give the 4% rule all that much consideration to begin with.

[solon]

Here's a math puzzle for you all:

Joe and Mary dig a hole.  They set a rod on the bottom of the hole and hold it upright.   The rod extends 6 feet out of the hole.  How deep is the hole?

I'm lost. The rod is 6 feet longer than the depth of the hole. How do we know the depth of the hole?

The joke here is that a rod was (is?) surveyor's tool that was standardized at ~5 meters/16.5 feet. So 1 rod = 16.5 feet is one of of the unit conversions if you look up a list of standard US units (e.g. non metric ones). Sort of like the joke about measuring velocity in furlongs per fortnight.

Oh, "rod", not, "rod"! Got it.

[Metalcat]

Yes, I completely agree it's easier to teach metric than the US standard units (I just don't think having the standard units taught in parallel makes metric any harder*). And the units are a lot easier to do the math when doing unit conversions and crazy back of the envelope math like pumping water from the ocean to Colorado.

I just genuinely don't understand why every some often I run into a person from outside the US that seems to take it as a personal affront that, even though we teach both, amongst ourselves we still mostly talk in feet and gallons and pounds. Was hoping that you as someone from the outside looking in, or someone else in the discussion, might understand why that is.

*And now that I think about it, standard unit conversions aren't even taught that much in schools anymore. My parents generation could tell you how many feet were in a mile. I'd have to look it up.

Being take things as a personal affront because people find it satisfying. There's no logic behind it, it's just a predictable human reaction to things that are different.

The metric system is just a very rare case of that system being frankly superior, so they feel super justified and can be comfortable in the zero risk of having their righteous indignation met with a reasonable counter argument.

The main thing that holds people back from know-it-all ranting is the risk that they might be humiliated by being proven wrong.

Simply put, people like to be arrogant dicks, even over the stupidest shit.

We learn and use both here in Canada, which is really the worst of both worlds. I have no idea what I weigh in kilos, but I can't estimate how far a mile is.

Fucking stupid.

[Retire-Canada]

I'm going to try one more time.

Sorry folks can we avoid going too far OT in a sticky about the 4% Rule? It makes reading this thread for OT content much harder for someone trying to get up to speed at a later date.

[Metalcat]

I'm going to try one more time.

Sorry folks can we avoid going too far OT in a sticky about the 4% Rule? It makes reading this thread for OT content much harder for someone trying to get up to speed at a later date.

Yes boss.

How about those markets eh?

Top is in?
Are we in for a decade of low returns?
Does this mean we'll all need a 1% WR/dividends only/put everything into real estate instead?

I ran my numbers through a FIRE calculator and it spit out 700% success rate, but what about Japan?!!!

WHAT DOES IT ALL MEAN?????

Ahem...okay, I'm done now.

[Metalcat]

I made a reasonable request. You don't have to be a jerk about it.

I'm being very very silly, not a jerk. And my silliness is entirely in line with my various on topic comments that I have made over the years in this very thread and many, many, many other threads that broach the same topic, so it's totally on brand for me and my typical 4% rule content.

This is the internet though, so I can see how you thought I was being an asshole. I was actually jokingly getting back on topic.

[nereo]

[tooqk4u22]

Why does there have to be a dust bowl event?  People are already looking at the water issues in the West and Great Plains.  I figure in 80 years, people ought to have the wherewithal to desalinate and pump water to where it is needed increasing agricultural output.

It's also worth noting that more than half of the grain grown in the US goes to feed animals. So what you might see is more of a dramatic shift in diets.

-W

The dust bowl reference got me wondering......was there a climate change issue back in the 1920-1930s when the dust bowl actually occurred?   Is there a climate change issue in the midwest and west or is it that populations increased dramatically along with water consumption for keeping lawns green and the spigots ever flowing along with the aforementioned water demands for ever increasing (and more stable as a result) agricultural consumption....both of which are derived from a source of water that is finite in volume whether by ongoing rain or snowmelt in the mountains.  I mean natures faucet only has so much capacity.   So yeah in the west especially, regardless of expense and energy, desalination might be the only viable option at some point.

[nereo]

Why does there have to be a dust bowl event?  People are already looking at the water issues in the West and Great Plains.  I figure in 80 years, people ought to have the wherewithal to desalinate and pump water to where it is needed increasing agricultural output.

It's also worth noting that more than half of the grain grown in the US goes to feed animals. So what you might see is more of a dramatic shift in diets.

-W

The dust bowl reference got me wondering......was there a climate change issue back in the 1920-1930s when the dust bowl actually occurred?   Is there a climate change issue in the midwest and west or is it that populations increased dramatically along with water consumption for keeping lawns green and the spigots ever flowing along with the aforementioned water demands for ever increasing (and more stable as a result) agricultural consumption....both of which are derived from a source of water that is finite in volume whether by ongoing rain or snowmelt in the mountains.  I mean natures faucet only has so much capacity.   So yeah in the west especially, regardless of expense and energy, desalination might be the only viable option at some point.

The concept that the climate *could* change wasn’t well understood until the 1960s. Heck, plate tectonics weren’t knows back then.
One of the core problems of water allocation in the west is that the estimates for rainfall were taken during an abnormally wet timeframe, and now we’ve moved into abnormally dry (drought)

[tooqk4u22]

Why does there have to be a dust bowl event?  People are already looking at the water issues in the West and Great Plains.  I figure in 80 years, people ought to have the wherewithal to desalinate and pump water to where it is needed increasing agricultural output.

It's also worth noting that more than half of the grain grown in the US goes to feed animals. So what you might see is more of a dramatic shift in diets.

-W

The dust bowl reference got me wondering......was there a climate change issue back in the 1920-1930s when the dust bowl actually occurred?   Is there a climate change issue in the midwest and west or is it that populations increased dramatically along with water consumption for keeping lawns green and the spigots ever flowing along with the aforementioned water demands for ever increasing (and more stable as a result) agricultural consumption....both of which are derived from a source of water that is finite in volume whether by ongoing rain or snowmelt in the mountains.  I mean natures faucet only has so much capacity.   So yeah in the west especially, regardless of expense and energy, desalination might be the only viable option at some point.

The concept that the climate *could* change wasn’t well understood until the 1960s. Heck, plate tectonics weren’t knows back then.
One of the core problems of water allocation in the west is that the estimates for rainfall were taken during an abnormally wet timeframe, and now we’ve moved into abnormally dry (drought)

That's part of the problem - what is abnormally wet or dry, can't it also be that the earth has a cycle as well that we don't fully understand.   I mean the concept of climate change and all the data is mostly based on recent history and geotech/snow samples and all that data is then extrapolated over a much greater part of history.  Even in the best case we have what maybe 200-300 years of some data such as a harbor masters log from 1780.   Its not fact, it's theory.   Its the same argument when an hurricanes result in billions of dollars of damage and many lost and displaced lives.....ummm, there are billions of dollars of property and many more people in those zones than there were 50, 100 years ago.   So of course there will be more damage.  Sure we can have

Climate change isn't a farce and we all need to do better but it also isn't the only driver.   

But  back to the 4% rule, even if it is - the concept of climate change will drive differing technologies and skill sets to mitigate or even adapt to whatever changes occur.   Hell we have a whole green energy industry that already is growing as a result.

[pecunia]

All of you folks comments make me wonder if the 4 percent rule may be overly conservative.  Sure there are water problems such as climate change desertification and the excess pumping of ground water aquifers, but looking at history people have solved a lot of problems.  You don't hear much about smallpox, the Bubonic plague or tuberculosis, for example.  In fact, technology and problem solving are not occurring at a linear rate.  Some say technological changes are happening at an exponential rate.

So, will this be reflected in the return on investments as well.  Can the return in, for example, index funds be expected to grow at an increasing rate as a reflection of the rate of technological problem solving?

[Metalcat]

All of you folks comments make me wonder if the 4 percent rule may be overly conservative.  Sure there are water problems such as climate change desertification and the excess pumping of ground water aquifers, but looking at history people have solved a lot of problems.  You don't hear much about smallpox, the Bubonic plague or tuberculosis, for example.  In fact, technology and problem solving are not occurring at a linear rate.  Some say technological changes are happening at an exponential rate.

So, will this be reflected in the return on investments as well.  Can the return in, for example, index funds be expected to grow at an increasing rate as a reflection of the rate of technological problem solving?

Fucked if I know.

[nereo]

Why does there have to be a dust bowl event?  People are already looking at the water issues in the West and Great Plains.  I figure in 80 years, people ought to have the wherewithal to desalinate and pump water to where it is needed increasing agricultural output.

It's also worth noting that more than half of the grain grown in the US goes to feed animals. So what you might see is more of a dramatic shift in diets.

-W

The dust bowl reference got me wondering......was there a climate change issue back in the 1920-1930s when the dust bowl actually occurred?   Is there a climate change issue in the midwest and west or is it that populations increased dramatically along with water consumption for keeping lawns green and the spigots ever flowing along with the aforementioned water demands for ever increasing (and more stable as a result) agricultural consumption....both of which are derived from a source of water that is finite in volume whether by ongoing rain or snowmelt in the mountains.  I mean natures faucet only has so much capacity.   So yeah in the west especially, regardless of expense and energy, desalination might be the only viable option at some point.

The concept that the climate *could* change wasn’t well understood until the 1960s. Heck, plate tectonics weren’t knows back then.
One of the core problems of water allocation in the west is that the estimates for rainfall were taken during an abnormally wet timeframe, and now we’ve moved into abnormally dry (drought)

That's part of the problem - what is abnormally wet or dry, can't it also be that the earth has a cycle as well that we don't fully understand.   I mean the concept of climate change and all the data is mostly based on recent history and geotech/snow samples and all that data is then extrapolated over a much greater part of history.  Even in the best case we have what maybe 200-300 years of some data such as a harbor masters log from 1780.   Its not fact, it's theory.   Its the same argument when an hurricanes result in billions of dollars of damage and many lost and displaced lives.....ummm, there are billions of dollars of property and many more people in those zones than there were 50, 100 years ago.   So of course there will be more damage.  Sure we can have

Climate change isn't a farce and we all need to do better but it also isn't the only driver.   

But  back to the 4% rule, even if it is - the concept of climate change will drive differing technologies and skill sets to mitigate or even adapt to whatever changes occur.   Hell we have a whole green energy industry that already is growing as a result.

I can’t tell if you are just fucking with me or not

But no. Just no.

[dandarc]

4 percent rule is overly conservative by design. 95% success means vast majority of the time, you worked longer than you needed to, often significantly so.

I personally think the 'rich-broke-dead' charts are the best illustration of this out there. Too much worrying about the sliver of red (broke).

https://engaging-data.com/will-money-last-retire-early/

[pecunia]

4 percent rule is overly conservative by design. 95% success means vast majority of the time, you worked longer than you needed to, often significantly so.

I personally think the 'rich-broke-dead' charts are the best illustration of this out there. Too much worrying about the sliver of red (broke).

https://engaging-data.com/will-money-last-retire-early/

Yeh - I'm good with that.  If it goes bad for me, I'll have lots of good company.

Thanks for the honest answer cat.