Mad Money Machine

C25K in Only Five Steps

Saw an article highly Dugg entitled How to Go From Sedentary to Running in Five Steps. Great read for those of you still on the Couch.

U.S.News & World Report Rates MMM Podcast TOP 10!

The Mad Money Machine podcast is proud to be rated one of  the TOP 10 Investing Podcasts by U.S.News & World Report. Katy Marquardt, an associate editor there and author of the New Money column, says:

Whether your work commute involves driving, riding the bus, biking, or running (like me), it’s a great chance to improve your investing know-how through podcasts. You’re a captive audience, after all. Below are podcasts that cover investing from 10 unique perspectives:

and then goes on to include Mad Money Machine as one of the Top 10. (I think she should have included Sound Investing there also.)

Thanks Katy for recognizing the MMM! And I hope you especially like the Couch to 5K episode while you are running.

MMM-116: C25K = Couch to 5K in 12 Steps

Get physically fit as well as financially fit. You’ll be running a 5K in only 12 steps. Great music to get you physically functional and timeless words of investment wisdom to get you financially free. Put this one in your playlist to keep forever.

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MMM-116: C25K [ 40:00 ] Play Now | Play in Popup | Download

The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com.

Topics in this week’s show include:

I’m interested not only in your financial fitness, but also in your physical fitness. Get off the couch and get running or jogging with the Mad Money Machine Couch to 5K Running Plan in 12 Steps based upon the plan originally described at Cool Running. That’s 12 graduated running plans starting with Step 1 that alternates between 60 seconds of jogging and 90 seconds of walking. The plan moves you all the way up to Step 12 where you will achieve a full 30 minutes of continuous running.

I’ve put together some great music to make your jogging effortless. Just listen for my cues on when to start and stop running for each step. Keep running on the same step until you feel comfortable that you can move up to the next one. It doesn’t really matter how long it takes you to get to step 12, as long as you’re up off the couch!

To help you spend your time, in addition to enjoying great music I’ll also give you an overview of each of the 12 Steps for Active Investors. You’ll not only get in physical shape but also in financial shape at the same time. Learning while running! These timeless tips worth memorizing provide an overview to Mark Hebner’s book, Index Funds: The 12-Step Program for Active Investors. You’ll learn what it means to be an active investor and why you don’t want to be one! By the end of these 12-Steps, you’ll be a 5K runner and a couch investor.

Music from music.podshow.com:
Money – Tems
ALTA PLAZA – XRAY DOGS
The Pop Culture – DJ Top Shelf
Money – Theory in Motion
Proof Remixed – Diet Slyce and On the Money – Trap Door
Money Control – Voide
Money – AbaNDa SHAKE
Coz They Invented Money – Gravitator
Cashbox – Big Head Todd and The Monsters
Runaway Train – Under Feather

Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763

MMM-115: Fashionable Frugality

Get your A-shirts on and move into your double-wide trailer! Frugality. Splits. Journey Revelation. Google Spreadsheets Forms. Buffet’s Big Bet. 3 candidates. iPhone. MMM Survey.

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MMM-115: Fashionable Frugality [ 34:07 ] Play Now | Play in Popup | Download

The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com

Topics in this week’s show include:    

• I was going to call this episode “A Wifebeater” but thought better of it.
• Scott Burns says old folks should share a double-wide trailer.
• Please take the MMM Survey!
• Better than having to live in a double-wide trailer, have Index Funds Advisors help your plan your financial freedom.
• 12 New Necessities that drain your cash.
• And buy cheap electronics too.
• The iPhone 8GB will be $199 (ah, but the ATT monthly plan will be $70 at a minimum).
• The Stock Chartists are getting dizzy as the S&P 500 keeps bouncing above and below its moving averages.
• Are there just two men running for president?
• TrueOhioPlaya wonders about the Vanguard ETF splits. And is it time to write covered calls?
• Jason out of Muscatine says please, please, please try Linux.
• Jason out of Muscatine says his friend hasn’t taken the Risk Capacity Survey because he doesn’t have enough money. BAH! You don’t need to invest with IFA in order to review the survey results. And here is the link listing alternative investments, such as Vanguard.
• Caller tries to snare me in a snake pit and answer whether spending time on a real estate business or just buying a REIT would be best. hahaha
• Our Guru this week is Journey. Get their latest 3-disc album Revelation. Arnel Pineda can out-Perry Steve Perry.

Amazon.com: Revelation ASIN: B0018OAP7K

• I compare Perry and Pineda on Who’s Crying Now? Perry will be in your left ear. Pineda will be in your right ear. Or was it the other way around?
• This week’s Tool is Google Spreadsheets that allows you to create Surveys for free.
• Next week’s show, MMM-116, is my interpretation of the Couch to 5K Running plan which I break out into 12 Steps (naturally). Create a playlist in your iTunes software and add MMM-116 into the playlist so that it doesn’t get deleted.
• Buffet has placed a big bet that Vanguard’s S&P 500 index fund will beat a collection of hedge funds over 10 years.
• What should we stock up on at the grocery store?

Music from music.podshow.com:
ALTA PLAZA – XRAY DOGS
Runaway Train – Under Feathers
Music from Wal Mart:
What It Takes to Win – Journey

Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763

MMM-114: Expert Predictions

Warren Buffet. Zune. Inflation. Vonage. Bogleheads.org. Backtest Spreadsheet. Sharpe Ratio. STDEV. Efficient Frontier. Box of Cash. Working on MMM-116… its gonna be a runaway hit.

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MMM-114: Expert Predictions [ 28:45 ] Play Now | Play in Popup | Download

The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com.      

Topics in this week’s show include:      

• Warren Buffet’s Expert Prediction is for a long, deep recession.
• I’ve heard from at least SIX Zune listeners!
• Please take the MMM Survey!
• Warren Buffet paid 19% tax in 2006, same as the 19% tax of GDP rate, write Brandon.
• DOW Chemical hikes prices 20%.
• If we assume prices will go up, then it makes sense to buy large amounts of non-perishable products now. What should I buy? Email me.
• Skwiggs says Vonage is even more expensive than Skype and Magic Jack. Yeah, but they don’t do existing number transfer.
• Diehards.org has now officially become Bogleheads.org. And gotten rid of that clunky old Morningstar forum.
• Our Tool this week is a backtest spreadsheet that Simba worked up over there at Bogleheads.org. You can enter your favorite allocation of Vanguard funds and it will calculate back-tested performance returns and Sharpe ratio going back as far as 1972 through the end of 2007. Use it for the fun of it.
• I explain the Sharpe Ratio. And also Standard Deviation. And I explain how the line from lower left to upper right on a returns vs. risk chart is the Efficient Frontier.
• I review the Lazy Portfolio Smackdown results thru May.
• Man unearths box filled with old cash. Unfortunately, they put it in a box instead of in Index Portfolio 100 because it would be worth $19,861,409 today.
• Show MMM-116 is something I’ve been thinking about doing for over a year now. This one is going to be a keeper for you. Listen to it on your iPod or Zune or iPhone.
• Our Guru this week is Barton Biggs who thinks we need to be ready for breakdown of civilization. But more significantly, he cites Philip Tetlock in saying that Experts should be ignored as random blather because they are less accurate than even non-specialists as to what is going to happen. They are worse than dart-throwing monkeys.
• Nouriel Roubini’s Expert Prediction remains bearish.

Music from music.podshow.com:
ALTA PLAZA – XRAY DOGS
Runaway Train – Under Feather

Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763

MMM-113: Regular Money Machine

Cramers says do index funds. Take the MMM Survey. More predictions realized. Inflation. Global interplanetary warming. Vonage. Comparing asset class performance. Where to invest in a 65-year IRA?

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But, if you just cannot deal with that then go ahead and Play the new show right now

MMM-113: Regular Money Machine [ 29:00 ] Play Now | Play in Popup | Download

The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com.      

Topics in this week’s show include:  

• Cramer says, “I think individual stocks are too risky.”  Yes, he really said that. I play it on this show. And he also said, “The best way to get to mad money is to start with regular money.” That’s what this show is all about. That helps Prediction #1 on its way.
• Do you listen on a Zune?
• Take the MMM SURVEY!
• More predictions results: #9: David Beckham scores a 70-yard goal. #4: Ron Paul does better than expected with 24% in Idaho. #6: A Fed governor resigned.

• Seattle Sounders will have “XBOX 360 Live” on their jerseys. DC United’s say “VW.”
• What is the deal with soft drink prices at restaurants these days? $1.95? $2.50? Holy cow. Ice water, please. The gobmint says there is no inflation.
• Scientists discover global warming not only on earth, but also on Jupiter and Mars.
• New book coming out The ETF Strategist looks promising.
• Paul calls to say do get a Mac and don’t go Vista
• Dave has the MadMortgageMachine.com show
• Douglas says go Ubuntu Linux.
• Why don’t they put a RFID chip in golf balls. Call it the iBall. Then use your iPhone to track and locate it. And play a song when found. (Looks like someone already has.)
• Vonage seems to work well so far… Will Verizon up my bill?
• Which asset class won over different rolling time periods?

• David from TheFastMoneyMachine.com wonders where to invest for his daughter’s IRA, planning for 65 years from now. I think this is a good time to take on some additional risk in the beginning. Tilt more toward small, value, emerging markets, and REITS, or maybe just buy PTO and be done with it. Or how about half VGENX and half VGPMX?
• The musical interpretation of Step 5: Manager Pickers

Music from music.podshow.com:
ALTA PLAZA – XRAY DOGS
Too Far Gone – The Dogs Divine
Runaway Train – Under Feather

Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763

Please take the MMM Survey!

I have created a 20-question survey for you the listener and reader to  help me make the Mad Money Machine better. Would you please take a few moments to completely answer each of the 20 questions and let me know what you’re thinking?

CLICK HERE TO TAKE THE MMM SURVEY NOW!

Thank you. You can click the link again at any time to view continuous results that other people have posted.

MMM-112: Full of Meat

Answering all questions via iPhone. Prediction #8 comes true. Beating the market explained graphically. Emails and calls. Please prove market timing works. Lots more meat…

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But, if you just cannot deal with that then go ahead and Play the new show right now

MMM-112: Full of Meat [ 33:14 ] Play Now | Play in Popup | Download

The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com.      

Topics in this week’s show include:    

• An email from Paul in San Antonio is what it is all about for me.
• Got a question? If I had an iPhone (well… the new 3G one at least) I could answer that for you. I’m cutting expenses in hopes of saving for iPhone service.
• Prediction #8 came true. I review the new ETFs of ETFs from PowerShares.
• Why have an advisor when you could do it yourself and save paying their fee? Because:

• An advisor can evaluate and re-evaluate your risk capacity and make sure you are invested properly.
• An advisor can perform tax-loss harvesting.
• An advisor can make cash flow decisions when you put more money in the account and take money out of the account.
• IFA has sophisticated reporting of your performance which takes into account cash flow.
• IFA is a safe haven for regulatory compliance; they are looking out for YOUR best financial interest not trying to maximize some sales commission.
• Tool this week is this graphic, Figure 8-18 from IFA.com. If you understand this, you are way ahead of the game:

The take-away of this graphic is that small-cap and value stocks have a higher expected return than the total market. You want your portfolio to be above and to the right of the dashed diagonal line.

• Tax revenues will be 19.5% of GDP no matter what the rate is, so why not make the rate low and the tax laws simple?
• David from Fast Money Machine says I should look at trends and Fibonnaci lines and know when to sell. I say, show me proof.
• Dominik wants to know if he should trust new index funds in Germany. I recommend going with iShares or Vanguard.
• Take our your cellphone and look at the number 4. Then dial 206-734-4763 and leave me a message.
• Going to be near Irvine CA on June 3rd? Definitely don’t miss IFA’s Lunch and Learn seminar. Please tell them I sent you. Please call or write me and tell me how it went for you.
• Why am I not a customer of IFA? Regulatory compliance. I’m taking one for the team.

Music from music.podshow.com:
ALTA PLAZA – XRAY DOGS
Radio Caroline – Jonny Dongel
9.5 Beats – Infallible
Sexual Tension – Infallible
Runaway Train – Under Feather

Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763

Prediction #8 Realized: One-Stop-Shop ETF

I made ten (really eleven) predictions on show MMM-092: Predicting the Future for 2008. Prediction #8 was:

8. A one-stop-shop ETF portfolio fund will appear that gives complete exposure to risk, reward, and diversification all for a low fee. It will include all of the SMILER components as well as some bonds, commodities, and even private equity and possibly even some selected shorts (A short of a bear fund, perhaps??)

That prediction came true today as I learned from IndexUniverse.com that PowerShares announced three “ETFs of ETFs“, their so-called “Autonomic” portfolios. All of the SMILER components (Small, Micro, International, Large, Emerging Market, and REIT) are in these plus some bonds and commodities. Even currencies, gold and oil funds are in these. These are the laziest possible portfolios; buy one ETF and you’re done! (Hmmm, maybe I’m not really recommending that. We’ll see…)

The funds are named “PowerShares Autonomic [style] NFA Global Asset Portfolio” where [style] is either Balanced (PCA), Balanced Growth (PAO) or Growth (PTO).

The total expense ratios for each of these funds include the expenses of each of the component ETFs plus another layer of management fees and are 0.82% for PAO, 0.75% for PCA, and 0.86% for PTO. Yeah, you might be able to do it cheaper if you bought each of the ETFs yourself. Then again, maybe not with all the trading costs.

The table below shows the percentage of each of the ETFs that are included in each of the new ETFs.

I intend to track these funds to see how well they compare against our Lazy Portfolios. I may even try to backtest a portfolio of the individual ETFs to see how well it would have done in the past, including the average annualized returns and Sharpe Ratio. The problem will be that some of the ETFs themselves aren’t that old.

I’ll be talking about this on show 112 and letting you know more as I know more. This is fun. By my count, that is 4 down, 6 to go. (Predictions #3, 4, 5, and 8.) I still stand by the rest. And we’ll see if Apple announces a tablet PC on June 9th for prediction #2.

And since I’m here, have you noticed that Jim Cramer has been talking more about “portfolios” recently? His “Kevlar” and “Stability” portfolios come to mind. This makes prediction #1 even more likely. #7 is a slam dunk. And hey, for #9 there are more international stars in MLS this season too. Go Beckham!

MMM-111: Triple Witching Ambivalence

Warren Buffett’s advice. Don’t try to beat the market, BE the market. Little money to invest? My recommendations. Magic demystified. New look. No WSJ. Millionaire secrets. LOST Time Loop. More…

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MMM-111: Triple Witching Ambivalence [ 28:40 ] Play Now | Play in Popup | Download

The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com.      

Topics in this week’s show include:    

• Which is the best active manager for your investments?
• Here’s help for overcoming your active trading addiction.
• Market returns *are* superior returns!
• Warren Buffett says buy index funds. Will you listen?
• Roshan wants to know where someone with little money can invest in index funds.
• I finished Biography of the Dollar by Craig Karmin. Nice read. Get a copy from your local library.
• I recommend listening to EconTalk podcast interview with Craig Anderson talking about his upcoming book FREE.
• The LOST Time Loop Theory
• The Magic Formula hasn’t been so magical after all…
• Does this web site’s new look work for you?
• My last issue of the WSJ has come and gone. I’m doin’ OK so far.
• Keith wants to know if mutual fund companies go out of business, do they take my money with them?
• Tired of paying PayPal 4% of the money you get? Try RevolutionMoneyExchange.com (and let me know how well it works).
• The Secrets of Self-Made Millionaires
• Triple Witching defined. Bottom line: don’t worry about it.
• Listen to the Giant Pool of Money episode of This American Life.

Music from music.podshow.com:
Runaway Train – Under Feather

Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763

Can’t get enough PDB on MMM? Check out RR with NP

NP (Nick Pardini) interviewed me on his RR (Rational Rants) podcast (Episode 9) asking me about the FED, the gold standard, and active vs. passive investing. Get it at CommonSenseMag.com or thru his feed.

I kinda forgot to finish my answer to his question about “what got me to this revelation about passive investing and don’t I have the urge to do active trading?” I went on about the recent credit crisis and forgot to mention that at that time I did sell some of my ETFs and mutual funds. I’ve kept track of how much those funds have gone up since I sold them and it isn’t pretty. But thanks Nick for the interview.