 We have a large and distinguished panel, individuals who have worn many hats as financial advisors, educators, authors, medical professionals. I'm going to be very brief about the introduction so that we can get into the meat of our discussion. I encourage you to look at everybody's bios on the Bogle Center website and go onto their websites. There's so much wonderful material. Many of you already heard Rick Ferry, Paul Merriman, Dana Ansbach, and Jim Dolly speak yesterday as part of Bogle Heads University. Today, joining them is Bill Bernstein, who we know is a neurologist by training, co-founder of Efficient Frontier Advisors, author of several books, also a Bogle Center board member, and my former colleague, Jonathan Clements, longtime personal finance columnist at the Wall Street Journal and more recently founder and editor of the Humble Dollar website. So we're going to talk about a bunch of investing topics, try and cover a lot of territory. If you have questions, Mike Piper will be gathering them. So Mike, could you stand up if you're in the room? Back there. So feel free to bring your question over to Mike and we'll save some time at the end to discuss those. So I think we're going to start with the climate interest rates over the last couple of years. Total bond market returns were negative in 2021 and last year and so far this year by a bit. The indications lately are that rates may be higher for longer. And I'm wondering for the panelists how that has changed, if it has changed, how it has affected your thinking about fixed income exposure, maturities, types of bonds to hold. And I'm going to ask Bill to start us off on that. OK, thank you for not asking me where I think your rates are headed because there are only three kinds of people there, the ones who don't know, the ones who don't know they don't know, and then finally the ones who know they don't know but whose jobs and whose paycheck check it depends upon appearing to know. They're the most dangerous ones. I think it really depends upon where you are in your life cycle. If you are saving for retirement and you're accumulating, you really shouldn't have that much in the way of bonds. You should have as much stocks as you can tolerate. And your bonds should be short nominal bonds of the safest available. They should be treasuries, basically. If you're an older person who is in the decumulation phase, you are now faced with what may be one of the great bargains of a lifetime, which is the ability to defy your real living expenses at a high real rate. Tips are now yielding about roughly 2.4% across the yield curve. So let's say you're approaching easer hood, you're 60, 70 years old, and you can buy a ladder that goes all the way out 30 years, which is almost certainly going to be beyond even most optimistic life expectancies that most of you are going to have. And you can guarantee a real consumption at multiple points out to 30 years. You can do it with a fund, you can do it by buying individual tips. And I think that this is an enormous opportunity. I don't like long-term bonds. I make an exception for tips because there you don't have to worry about inflation, inflating the value away. So would you advise people to put all of their fixed income exposure? Someone who is at that laddering point heading into retirement, would you go all tips? It depends upon their burn rate. If you're a kind of person who's got a very low burn rate or a zero burn rate, but certainly a one or 2% burn rate, it really doesn't matter what's in your portfolio. You're going to do fine. And you don't really need that tips. Ladder out there. But if you're burning four or five or 6%, I think a healthy dollop of tips would be worthwhile. I personally don't need them in my own personal portfolio. But I really like having them there. I've got now a nice dollop of them. When I want to need to go to bed at night, I don't count sheep. I count my tips. Dana, I know in your portfolios, you don't use tips, you use nominal bonds. As you're doing your planning, has the current interest rate environment changed what you're doing with clients? Not fundamentally. I really like what Briggs said yesterday about philosophy versus strategy. So it hasn't changed our philosophy. There are views to teaching just as that's the biggest impact that we've had is on managing short term cash. So two years ago, in no sense, it's been a lot of time managing cash in an extra .1 zero basis point. But now, if you have someone taking $10,000 a month out and you need to hold that $100,000 a very quick with assets to meet that monthly withdrawal, it doesn't make sense to manage that cash and not in the short term treasuries to meet money market. So that's the biggest impact it has had. It has also had the impact of us extending our bottom ladders. Some people are willing to do that. You can lock in 5% yields. And two years ago, someone was excited about locking in 2% yields. And so it has changed the behavior of the willingness of people to say, yeah, I do want to build up our bottom ladder. I do want to do more of that. But philosophically, no, I'm not the teacher. Other people who are doing things in the fixed income area we want to talk about while we're in this space. The other thing is it may be much more patient. And that doesn't hurt nearly as much as when it was only making one percent. And Jim, while you have the microphone, so let's talk about tips obviously are such a great way to hedge against inflation. I'm interested in how much you worry about inflation and are there instruments besides tips you looked to hedge inflation longer term? I'm incredibly worried about inflation. Bill has talked about the four horsemen that really are serious dangers to a portfolio. And the most common one of those is inflation. So anytime you build a portfolio, whether there's been nine inflation users here, thinking about inflation, you need to beat inflation. It's the investor's chief enemy. But trying to hedge inflation this short run is really hard. In the long run, it's not that hard. You've got good tools, you've got tips, you've got iBonds on the fixed side, you've got stocks and real estate and those sorts of things on the equity side. And in the long run, I don't think it's necessarily all that difficult for an investor to design a portfolio that's going to keep up with inflation. But I think a lot of people were surprised in the last two or three years when inflation came up how hard it was to kind of stick with it in the short term. And I think a lot of people were surprised when maybe tips didn't do that so well, when real rates went up. And of course, when rates go up, the value of a bond goes down. And I think that surprised a lot of people that expected when inflation showed up, unexpected inflation showed up, that their tips would somehow protect them. And they didn't feel like they did that very much, I don't think for most of us in 2022. Well, I think we always get those reminders of how incredibly complicated bonds are in general. And tip certainly adds a whole additional dimension to that. When you thinking about hedging against inflation long term, what should be the asset classes that I should focus on most? Anyone? Oh, I'm sorry. Well, I mean, historically, we would look to stocks to be the best, but to the extent that we use fixed income and we don't manage money and we don't give advice to individuals, but to the extent that we use fixed income, we're always short to intermediate, never long. I think that's what Bill said. And so I think those are, we don't look to gold, for example, or commodities, but basically have a balanced portfolio of the big, the small, the value and the growth and the U.S. and the international and the REITs and the emerging markets. And in there, you're going to have some combination that is likely to be a kind of an all-weather portfolio. At least that's what one hopes. Other thoughts on the mix, Jonathan? So inflation is less of a concern if you're still in the workforce, prices rise, so should your salary. It's a much bigger issue for retirees and the greatest defense for anybody who's retired against inflation is to delay social security. I mean, it's the best inflation indexed annuity out there, if you can afford to and your health is decent or the health of your spouse is decent, delaying social security age 70 is, I believe, probably the smartest financial move any retiree can make. And because of recent inflation, it looks even smarter. A thought on inflation as in terms of how it impacts retirees, it impacts different demographic segments differently. And so we talk about the go-go years, the slow-go years and the no-go years in retirement, and we offer inflation raises to our clients and I would say 60 to 70% of them turn them down and say, no, what I'm getting covers my expenses even with the recent price increases that we've seen. Now, for people that are in the lower demographic, they're spending less than 100,000 a year, basic increases in gas and food prices are gonna have a much bigger bite into their budget than people in some of the demographic sectors where they're spending more. So we definitely see that in real life and we see that as people get into those slow-go years, they're spending naturally declines and so their inflation is real, it's there, but it's not impacting them perhaps the same as someone that's still actively out there, traveling and buying furniture and putting, you know, paying for their kids and all of those types of things. So looking at the US stock market, one of the trends that we see is increased concentration. A lot of the markets return this year has come from what people refer to as the magnificent seven tech and tech adjacent stocks, which recently represented about 30% of the value of the S&P 500. So I'm wondering, does that concentration change the way you feel about using market-weighted indexes like the total return, total stock market return or the S&P 500 in portfolios? Rick? Oh, this is loud. So no, because if money came out of the mega cap eight, which is the magnificent seven plus one, it's probably not going to leave the stock market. So the fact that it might come out of those large cap stocks and get dispersed among the mid cap and small cap stocks keeps the same money in the market. Therefore, if you have a total stock market index fund, you shouldn't see any effect. The only issue would be if the money came out of those magnificent seven or mega cap eight and just left the market totally, yes, then you would have an impact. But I think that the people who are in stocks tend to stay in stocks. So we just get the dispersion of that money would be sent across the rest of the spectrum of stocks into a total stock market investor. It's the same amount of money, same value of the market. So it won't make any difference in my view. So if you've been writing about this stuff for four decades, which I have, you start to see the same stories over and over again. And when people talk about the concentration in the stock market, this is a story that can be written every year. It's a simple mathematical phenomenon known as skewness. The most the stock lose is a hundred percent but its potential gain is infinite. In almost every year, the stock market is driven higher by a minority of stocks that have fabulous gains. Those of course are the stocks that catch people's attention. Those are the stocks that make it into the headlines. Those are the stocks that cause people to give up indexing and go and try their hand at picking hot stocks in the same way that they try their hand at trying to pick hot lottery tickets. And it normally has the same unhappy ending. Don't be put off by all these conversations about how concentrated the indexes are in certain stocks and how the market has been driven by a minority of stocks. It has always been ever so and it will always be ever so and it's because of this notion of skewness. Yeah, it's an interesting exercise just to go back 50, 60, 70 years into 10 year intervals, look at what the mega caps of the era were. 1970s, what were they? They were oil stocks. If you put all your money into oil stocks in the 70s, you didn't do so well. 1980s, it was IBM investing a lot of your money in IBM and the 80s wasn't such a great idea either. And it just rolls forth decade by decade by decade. It's probably one of the worst bets you can make is buying Decile One and only holding Decile One's largest cap stocks. I think Jonathan has this line about the, look at the person in the mirror in the morning is your biggest enemy. And I find that the big decision is, what am I today? Am I still a buying holder or am I market timer? And in theory, we all believe that I find the one that's gonna serve us best, but there's something that throws us off along the way and we start to change the nature of how we approach the decision making. And the minute you get into this pattern, I think you're at risk of chasing either a fad or been hot recently and it feels like there's gonna be more of that so you wanna do something about it. I really have tried to encourage people, figure out how much in stocks, how much in bonds, diversify, whether or not without small cap value, by the way. And just be happy. When we go beyond that, we tend to do more hard. By the way, Paul, you missed your cue when it was a question about inflation because small cap value stocks are a marvelous hedge against inflation better than the broad stock market. So one of the things we talk about buy and hold but it's hard because you feel periodically that oh, maybe I should do something different. I thought it was really interesting in the session that Jim did as part of Fogelhead's 101 yesterday. He talked about reasonable portfolios versus unreasonable portfolios. But the reasonable portfolios are what? 28 of them you listed? I mean, I could have listed a lot more in 28. I've got a blog post with 200 of them. The point is there's hundreds of them. So I think a question for us then is when I look at all the possible reasonable portfolios and that reasonable portfolio could be a single all-in-one fund or it could be 15 or more individual funds, what do you think is make the number of funds that potentially makes sense for someone to be able to stay the course? As far as the number of asset classes in a portfolio, I look at three is kind of about the minimum. I think there's real benefits in going up to about seven. Maybe very minor benefits and going as high as 10. Beyond that, you're playing with your money. And those are asset classes which may or may not require separate mutual funds or ETFs, right? Yeah, the beautiful thing about indexing is you only need one fund for the asset class. So I am perfectly content to let Jerry manage all of my US stocks. Every day he goes to work with a team of 25 people and works very hard to manage my money. And I appreciate that. And he's managing a lot of my money, but he does it very well. And that's all the exposure I feel like I need to that particular asset class. Now, if you are in more actively managed stuff, you got to have more holdings. For sure, because you need to diversify manager risk. One of the 67 asset classes that you're in, you look to. Well, I think that's not necessarily something anybody else needs to model, right? I think having multiple asset classes is a wise thing in a portfolio. Does everyone have to have the same asset classes? No, some good asset classes I think people really ought to consider. US stocks, international stocks, nominal bonds, inflation index bonds. I'm a fan of small value stocks along with Bill and Paul. I am a fan of real estate. So there's six. And I think when people are getting into six and seven, they're probably looking at those sorts of asset classes, but there's plenty of others out there, right? There's 20 or 30 asset classes and it's okay to include some of those. You don't need all of them though. Yeah, a lot of you probably weren't here at last year, but Mike Piper said something that was very profound last year, which is the sorts of things that we all obsess up, obsess about how much small value, how much REITs, God, do I wanna own precious metals equities? Do I wanna own one fund or five funds or eight funds? That's a piddling significance. What is really important is do you have disability insurance? Do you have good life insurance when you're young? Are you giving enough money away to your kids and your grandkids? Those are the really important questions. The most important thing about the complexity of any portfolio is not what it looks like, but can you stick with it? That is far more important than whether you own one asset class or 12. And so given that that is the challenge, and I think it's a challenge we all face personally, even if you say, I'm gonna stick with it, there are times that suddenly that feels hard. What advice would you give to people in how they construct their portfolios or how they live their lives to help them stay the course? Yeah, a suboptimal portfolio that you can stick with is better than an optimal portfolio of one you can't execute. It's just that simple. So pick something that you can stick with it. So you can stick with a simpler portfolio, a lot easier than a complex portfolio. And John Bogle said this a long time ago, and I brought it up yesterday in one of my slides. If you're just a market investor and you're investing in the total stock market, and the market goes down, you know your portfolio's down and most people can accept that. If you're doing a slice and dice portfolio, and it's going down or it's not keeping up with the market, so how many concerns you? More, and maybe you're more apt to make changes, more apt to capitulate on that strategy. So I think the simpler you make your portfolio, the better. I think that it is a matter of having the right portfolio, but the problem that I've found over the years is most people have not actually identified, not just the potential return, now that's the easy part, but making sure they know what building loss factor there's going to be in that portfolio. And if you're gonna find a portfolio that you're gonna stick with, it isn't gonna be because of the upside generally, it's gonna be because of the downside. And the industry oftentimes will ask, are you willing to lose 20% of your money? Well, if you are, it's okay to be in the stock market. What they should be saying is, are you willing to lose half of your money? Then if you are, you should be in the stock market, and if you're not, you gotta put enough fixed income into the portfolio to bring the potential loss down to where you are willing to say, yes, I'm willing to do that. Then I think you can stay in the course, but you gotta somehow get there, we call it education. Sort of at a related note, Bill, this year, the second edition of your four pillars of investing book was published. Could you tell us a little bit about the way you're thinking about investing has changed since the initial edition, which was what, 20 years ago? Yeah, two ways. I was very impressed with a quote from the man by the name of Robert Kaplan, who's a historian, who said that half of everything is geography and the other half is Shakespeare. And I realized that that pertains almost precisely, analogously to investing, which is that half of it is mathematics, but the other half is Shakespeare. And you can be, the answer to investing better and better is not more and more math, or a lot of people on the Boglehead's forum might think you believe that, unfortunately. It's can you handle the vicissitudes of the marketing of your own psychology? So, long-term capital management, most brilliant mathematicians out there planted their faces because they didn't understand enough about market history in their own psychology. They didn't realize that every 10 years or so, the wheels come off the machine. And by the way, their model is only based on four years of data, so that was another little mistake that they made. So it's the importance of the psychology, and I tend to de-emphasize the importance of the math. I think if you can get within a factor of two on anything in investing, you're probably doing very, very well. I'm reminded of the joke is how do you know that financial economists have a sense of neurons because they use decimal points? So that's the first thing. And the other thing that I've realized over the years is the importance of liquid assets. You've got to be able to sleep through the worst of times. How well you do in the long-term depends upon how you react in the worst 2% of times, all right? And that's because that's when you're most likely to interrupt the magic of compounding and disobey Charlie Munger's first rule of compounding, which is to never interrupt it. There is a reason why Warren Buffett holds 20% of Berkshire in T-bills, because he can sleep at night. Or when the 300-year flood hits his insurance companies, he'll survive, and no one else will. And you have to have that same sort of outlook as well. So those are the two basic things that changed. One of the situations where we come up against that question of balancing finance, mathematics, and emotions is when someone has a lump sum, a windfall of money that they might invest in the stock market. So Paul, could you talk to how you approached that question when you're talking to someone about, do I put my pile of money into the stock market tomorrow, or do I dollar-cost in over time? Well, it's been 10 years since I've had to do that for people, but when I did, first thing we have to figure out is who we think they are in terms of their emotions of being able to actually put it all in at one time. The industry, of course, says that you're best off to get everything to work immediately, but of course, that's the industry that wants us to invest through them, basically. And immediately, for most people, is actually probably not the best way, because there is some probability that the next thing that's gonna happen is the market's gonna go down, and this is not what they were prepared to go through with all of that money. Whereas if you dollar-cost average it in, and it is a form of diversification, dollar-cost averaging, and as somebody recently said, when you're, anytime you diversify, you're settling for second best, in a sense. And so dollar-cost averaging is something that where you are likely settling for a second best, but it's something that you should be able to do, or if, and I found it's worked often with a client that couldn't trust either way, half of it buy and hold, immediately put it to work, the other half, you dollar-cost average in. And in a sense, you've got the best of both worlds of me. I guess in a way you can't do wrong except for one thing. At the end of the dollar-cost averaging, or the lump sum, the market can still go down. So you never outrun the market if you're worried about it going down. So I have immense respect for Paul. But I disagree with him on this point. I think dollar-cost averaging is for WIMPs, because of what Paul just said at the end. At the end of this dollar-cost averaging period, whether it's in three months or six months or a year, guess what? The whole portfolio is exposed to the market. And if you're not okay with that, what that indicates to me, maybe your asset allocation is too aggressive for you. And you ought to dial it back until you are willing to lump sum this new money into your asset allocation. And so I don't see a big role for dollar-cost averaging. I think it's a psychological crutch. The historical record is that you will do worse most of the time, not all of the time of course, but because the market goes up most of the time, most of those additional investments you make over the next few months are going to be at higher prices. And you're getting a worse deal. So I think you really need, if you're really having trouble putting a lump sum in, you ought to look more carefully at your overall asset allocation, because eventually you're going to be lump summed in. I think you're wrong, Jim. I'm older than you are. And I am willing to take second best. That's why I have bonds in my portfolio. So it's just another defensive strategy. In fact, probably the expert on this is Jonathan Clements. Since he speaks to the emotional side of this process, I'm curious what side you come down on. Thanks, Paul. Yeah, I think it's very hard to get somebody to put a lump sum into the stock market based with the possibility that the market is going to drop dramatically tomorrow. But I think before we say, yes, you should lump sum it, or yes, you should dollar cost average, what people need to do is step back and say, how important is this sum money compared to what I already have and what I will need in the future? So if Grandma dies, and you've already got a $2 million portfolio and she leaves you $100,000, invest it right away. $100,000 compared to the $2 million you already have, not a big deal. If you have $100,000 and Grandma leaves you $2 million, it's a much tougher decision and I can understand why somebody might actually listen to Paul and put it in more slowly. Jim is absolutely right. That dollar cost averaging is for wimps. The trouble is that most of us are wimps. All right. I'll throw my two cents in. So investing in the market is painful because you know as soon as you invest, it's gonna go down. You know that. Gonna happen, right? So you either rip the big band-aid off one time and do it Jim's way and you're done. You're in and that's it. You're done. Or you have to rip multiple band-aids off over a long period of time. And a lot of people might rip one or two or three off but they never get to ripping the fourth one off. They start looking at the markets, they start coming up with reasons. It's not to do that dollar cost average, that third or fourth one or so forth. And a lot of times, at least if it's, it doesn't get done. So ripping the band-aid off one time and getting it done, Jim's method, I find actually gets the money invested and dollar cost averaging often doesn't get the money invested because you have to make the decision to hit the button to invest the money multiple times and your mind is playing all kinds of tricks on you during that period of time. Unless of course you have a fantastic money manager like Paul managing your money and then you don't have to worry about that because he'll do it for you without any pain whatsoever. Not anymore. So I think that was just great. So this was just totally encapsulated the interplay of the math and the emotions of investing that we all struggle with. So I'm gonna thank all six of you for that. I'm gonna try and move on, but I will just also just remind you if you have any questions, please give them to Mike Piper. I think in about another five minutes we'll try and move on to questions. So we'll still have 10 minutes to do questions. Coming back to, coming to a classic Boglehead's question, looking at US versus international stocks over the trailing year, total international and total US stocks are just about neck and neck. And I point that out because that's the exception because over so many other trailing periods, year to date, three years, five years, 10 years, 15 years, US stocks have done so much better than international. So the question is, I'm wondering about what your views are on international diversification? Should I bother? The flip side of that is so if I've had international stocks as part of my portfolio forever, do I stay the coarser? Gosh, should I maybe change my mind and get rid of that now? Jonathan, you want to start? Yeah, let me kick this party off. It's the end of the year. You're looking back. Your home market has been the most fabulous performer, not just for the past year, not for the past decade, but for multiple decades. It is the hottest market in the world. Why in the world would you possibly invest abroad? This, of course, was what Japanese investors were faced with at year end in 1989. And those who suffered from home bias are still sitting with portfolios that are underwater more than three decades later. That is why I invest internationally because unlike the rest of you who think that US is the only place to invest, I do not have a crystal ball. I do not know what will happen in the decades ahead. But I know that if I am globally diversified, the sort of hit that has been suffered by Japanese investors will not happen to me. Yeah, here's the realm, which is that there's no question that the US economy and US earnings and earnings of US corporations are growing faster than that in the rest of the developed world. The problem is, is if you put a million dollars into US stocks, you are getting perhaps 30 or $35,000 worth of earnings. If you put them into ex-US stocks, foreign stocks, you're getting twice that, you're getting $70,000. And I think it's a pretty good bet that that $35,000 you're going to get in US stocks and earnings is not gonna grow fast enough to overtake the $70,000 you're gonna get from foreign stocks. You see the same thing with dividend yields as well. And that's the math. The Shakespeare is the Kahneman-Tversky availability heuristic, which is, we always look backward at the last decade and we say, why have I invested in this dog of an asset class? I'm done with it. I don't wanna face it anymore. I'm going to sell it and only invest in US stocks. And three times out of four, that's a big mistake. I will say the all-weather portfolio that I talked about yesterday that held up better under the worst case scenarios did have a higher allocation to small cap value and international than perhaps the traditional portfolio would. I think it's also interesting that we so often look at the combination of US and international and once we have those, we're diversified. Oftentimes, it's viewed as if you own the total market index is in the US and the international, you're diversified. In reality, historically, we expect certain kinds of returns, I think, from large cap blend stocks. And we expect... It may be that what we should be talking about, I think, what we should be talking about is not should we about international versus US that maybe a better diversifier is the small and the value even if some of those end up being international. That all can work, but that that diversification is a more true diversification than getting large cap US blend and international US, international large cap blend. And I think it will do more for the investor than you'll do better with the small and the value and the big blend in the US. You don't need international. International may give you some lower volatility because of the diversification of, this is a word I can't remember anymore, I'm sorry. But that, well, I'm gonna stop right there. I understand what you're saying. I've got to call the home. Look, first of all, you get three different types of diversification with international. You get more stock because I think the international markets have, the Vanguard International Fund, Total International has something like 4,000. I mean, Jerry, you can correct me if I'm wrong, but 4,000 is some of the main. So you're getting more diversification because you're getting more companies in there. But the second thing you're getting is you look at those companies, the industry groups of international stocks are quite a bit different than the industry groups of US stocks, a lot less technology, a lot more brick and mortar companies, value companies, if you will, to Paul's point. So you get that more industry diversification, a more global industry diversification. So that's a second type of diversification. And third, you get currency diversification. I mean, the dollar's been very strong. We benefited from that as US investors. I don't know how long that's gonna last, but if the dollar does to start going down relative to international currencies, you've got currency diversification. So you're getting more stock, you're getting more industry, broader industry diversification with international, and you're getting currency diversification. So I think that's a good bet to have 30 to 40% of your portfolio in international stocks. Mike, if you get a chance and wanna bring up our audience questions, we'll try and do some of those. First question is given recent bond performance, could you discuss the pros and cons of investing and holding actual bonds, individual bonds like US treasuries versus bond funds? Oh, I will say, I mentioned this to Karen yesterday. One question I got quite a bit yesterday, just one-on-one was should I sell my bond funds right now? And it came back to a conversation earlier here of discipline and what does it take to stick with your strategy? I think you really need to know why you own what you own. So if you own bond funds and you're rebalancing to an allocation, you should have a rebalancing frequency, and that's what you do, and you don't deviate from that strategy. And one of the most important things is sticking with a strategy over time. In our practice, we prefer individual bonds because we're using them to meet a specific liability in the future. We have planned out what cash flows someone needs, that bond makes a perfect choice, we know when it matures exactly what we're gonna get. So I think you really have to decide what your investment approach is going to be. And once you decide that, that's gonna lead you to the right choice for you. Yeah, Dick, I agree completely with Dana that a bond ladder of individual bonds is superior in the sense that you can match liabilities and expenses, you can't do that easily with a bond fund. And it's really a matter of convenience. It's really a pain in the took us to put together a bond ladder. It's easy to buy a bond fund. And the way I look at ETF versus open and close and do you own individual treasuries if that's what you're going to be owning, you're gonna get a Rubin sandwich, okay? It doesn't matter whether it's wrapped in yellow paper or green paper or red paper. At the end of the day, it really doesn't matter that much. It's really a matter of convenience and psychology or anything else. I think it's important to point out there's a difference between trying to buy a treasuries individually versus a treasury fund and trying to buy individual corporate bonds versus a corporate fund. I think there's a real diversification need there when you get into corporate bonds and to not quite as much of an extent, also muni bonds that it's worth using a fund for those. But I think you've got an option when it comes to nominal and treasuries and tips. Thank you. One question we had, I'll probably address this to Jonathan since you talked about the value of waiting to collect social security. If I could collect my social security earlier and invest all those dollars, why wouldn't I do that? There are various questions that make my head explode. You know, one of them, and I won't go back to it, but one of them is the bond fund versus individual bond question. So much nonsense said about that. Similarly, why don't I take my social security early and invest it? Well, yeah, if you take your social security early and you invest it in stocks, yes, you're taking on more risk, but yes, you should do better. But it's an apples to oranges comparison. You're comparing a government guaranteed flow of money to investing in the stock market. If you take more risk, yes, you should earn higher returns. But if you compare taking social security early and going out and buying bonds or bond funds, no, obviously it's not gonna be insensible. Most people in retirement are gonna want a stream of income they get every month and preferably an income stream that is indexed to inflation and that is at least partially tax free. And that is what social security will deliver. We also know from the research that retirees who have predictable income from a pension, from social security, from an immediate fixed annuity tend to be happier. Frankly, when people claim that they're gonna take social security early and invest it in the markets, if you dig beneath the surface, what you tend to find out is they have already claimed social security early and now they're trying to justify what they've already done. I'm moving on to a different question. If I have a certain percentage of my portfolio that I want in bonds and I don't have any more space in my tax deferred accounts, would you recommend buying munis in my taxable brokerage account? How do I decide if munis are right for me? I think that's exactly how you decide whether munis are right for you. I used to have a portfolio that was all sheltered. Now a portfolio that's almost all taxable. That's just the way my financial life has gone. And so my bonds are now mostly in taxable. And because I'm in a high tax bracket, that means muni bonds. And so I think we're forced by our circumstances to invest in muni bonds. I just can't put everything into a tax protected account. It's too small of a percentage of my portfolio. So something's gotta go into taxable. And if it's gonna go into taxable and it's bonds for me, that means muni bonds. In terms of deciding if you should have munis, you look at the taxable equivalent yield. So what would you have to earn on your muni after taxes to make it equivalent to a taxable bond? Thank you. Gonna like this one. Our index funds a bubble. We'll let the paddle address that. No. They've done very well though. No, index funds a bubble? Is that what the question was? No. I think it's important to realize that yes, U.S. stocks have done great, right? Over the last decade. But I've got a lot of index funds that haven't necessarily done that great over the last decade. Those are index funds too. So I wouldn't say that because it's an index fund, it's a bubble. I mean, the index fund is just matching the market. That's it, whatever that market may be. And just to add to Jim's point, if you have a calculated index fund, every stock that it owns, individual investors actually manage their portfolio in exactly the same percentages if you look at them collectively. So if index funds are a bubble, then so are all active investors invested in those stocks. Yeah, there's a whole list of really stupid things that active managers say about index funds. And I think that's number two or three on the list. It's pretty pre-high up on the list. Okay. I wanted to ask you, looking out at the landscape of investment products and services at Vanguard and at other firms, I'm wondering are there developments of note that you think could be beneficial or handy for investors or things you're seeing that you're particularly concerned about these days? Are you asking about products that should be available that are not? It could be that or it could be things that are available. Well, I'll make a pitch and I've been doing this for a long time for balanced ETFs that we can put in taxable accounts where the tax efficiency of the ETF would be using that create redemption baskets within the ETF would be a real benefit in a balanced portfolio. So you could buy one fund, you could buy a balanced index fund in your taxable account that has municipals in it, no capital gain distributions, fairly low given in distributions. I think that would be beneficial, but it's not out there. I mean, Alan Roth is an up here right now, but I'll put in a plug in for his favorite idea or what I think is his favorite idea, which is if you take the current tips yield of let's say 2.4% and you amortize that over 30 years into a sinking fund so that you get inflation adjusted real income every year for 30 years, you basically are making a ladder, then you have about a 4.8% burn rate out of that, a real burn rate of 4.8% every year goes up by inflation. And it would really be nice if some large index fund provider would provide a fund like that, dated to, you know, 2053, 2043 and so forth that would yield that amortized real interest payment over the lifetime of it, we would have a fixed duration. But there are some fixed duration tips funds, ETFs now, right? Yes, but they're constantly rolling, there's some brand new ones that basically function as individual tips, they're basically one year tips, which don't make a lot of sense to me because you might as well just buy the darn tip for that year. One product, it's not necessarily new, but it addresses the concern that Jim brought up in terms of when you're buying individual bonds, you know, it can be very safe to buy treasury bills or agency bonds or CDs, but when you get into corporates, now you're taking on some risk. So there are packages of bonds, it's called bullet shares, it's basically an ETF, it's a package of bonds, they all mature about the same time. And so I think products like that can be a good hybrid that allows you to create someone of a bond ladder, but still getting diversification if you were gonna go into corporates. If I could have one wish out of Vanguard, it would be that they would fix it so we can buy ETFs other than Vanguard with partial shares. I think that'll change the life of a lot of investors who don't have a lot of money. Okay, I think we have run out of time. I wanna thank an incredible panel, Bill Bernstein, Rick Ferry, Paul Merriman, Dana Ann Spock, Jonathan Clemens, Jim Dolly. It's been great to hear all your observations for disagreements, thank you.