Vanguard Lawsuit & My Comments

Flash Edition For Paid Subscribers: Jae's Corner In Full Flight

The Completely Uncut Video is Up

In order to create a video, there is tons of editing required, blahblahblah. It's a truly awful process. 10 minute video? 4 hours of work, easily. To make it worse, it’s 530P, not like the video editors can be summoned easily to work on this now.

That said, the principle and timing is important here, so much so, that I simply posted everything, warts and all. I am showing you the segments, of the points that I want to make in the video. You know how certain videos show you the “outtakes?” Well, they’re here, please be sympathetic and kind =).

My opinion is that the quality of the material is far more valuable than the polish of the production. I know that the book and this Newsletter suffer as a result of that, but tough choices have to be made.

The polished version will appear on the public YouTube Channel later, maybe in a week or so, but you should have this now. The world is a very volatile place, and I don’t suspect the backdrop resolves itself instantly, irrespective of tomorrow’s Fed meeting. And the underlying issues in the video will persist: people are seeing -10% YTD easily, and if they have individual stocks (that are not energy-related), then much, much worse than that.

Background

Link to CNBC article: click here.

It is NOT a coincidence that I have been examining the targeted retirement funds of the largest, most well-known companies. The issues involved here are INHERENT in the nature of these funds.

a. The managers (Vanguard, BlackRock, et al) are the MOST HIGHLY COMPETENT, these are not village idiots throwing darts. Their command of linear algebra, covariances and correlations (which I have attempted to explain to paid subscribers) is unchallenged. That is entirely different than the resulting performance, after the fact (which is the output, and highly influenced by the randomness of financial market outcomes).

b. That said, the ripple effect on consumers isn’t well-understood. In fact, I am pretty certain that many stock jockeys don’t understand the last 4-5 minutes of the video, until revealed (I’m a drama queen, it’s society’s fault). They will understand that distributions occur, but they largely neglect the ripple effects, and these ripple effects can be over $10,000. I have little almost no sympathy for this because in many cases, this could’ve been avoided. An attorney friend of mine, a client, has literally called it malpractice.

It is for this reason that I am speaking at the ACE Academy in Nashville (CFP people get CE credit for my appearance). CPAs, unfortunately, have to report the result to their clients.

Here’s my explanation, and a couple of jibber-jabbers because the book will appear in paperback format soon, and the pre-orders at the libraries is very widespread (Amazon won’t tell us).

Coupon Code = JAE for 10% off.