Last week the The Digerati Life, a generally worthwhile blog, had a generally worthwhile post on market timing. (Bottom line: you really shouldn’t.) But 
it had a few sentences I keep rereading.
I have in my portfolio two ETFs that track the movement of the Dow. One makes money when the market goes up and the other makes money when the market goes down. The only job of these ETF’s is to react to the overall market. The responsible thing that I do is to buy them both as a form of insurance. I buy both because I know that I cannot predict the market movements.
So Silicon Valley Blogger owns two ETFs that exactly mirror each other, such that the net of the combination of the two is zero? (Actually, it would be the T-bill rate less the management fees, which is approximately zero but maybe less.)
That can’t be right. She didn’t mean that. That would be dumb.
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This blog is primarily about bad advice, that is, the recommendation of unwise money choices. But I also have a nice sideline going in misinformation, statements about personal finance that are not merely foolish, but are flat-out objectively wrong.
A recurring topic in that area, you might call it a running gag, is the lack of tax saving advantages of Roth IRAs over 
traditional ones. When I started this blog a few months ago I assumed that most of the people who published misinformation about Roths knew better but had some motive, be it sinister or well-meaning, to mislead. Now I understand that they just don’t understand what they are talking about.
The latest infuriating instance of this is a blog post on Mint.com written by Michael B. Rubin, author of the book and blog Beyond Paycheck to Paycheck and "President of Total Candor, a financial planning education company." It was linked to by the Wall Street Journal’s Wallet blog.
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The latest hot topic on the identity theft front is a paper published on Monday in The Proceedings of the National Academy of Science by two professors at Carnegie Mellon on how easy it is to guess a person’s social security number.
That day Ars Technica reported on it. Also, the authors of the paper started a blog on it. The AP picked it up Tuesday. CrunchGear blogged on it then too. And Wednesday brought posts from Wise Bread and Wallet Pop.
This is a great story. It combines several of my favorite themes. There’s the ever amusing hysteria over identity theft, which apparently renders a person incapable of rational thought and perspective. There are the unintended consequences of seemed-like-a-good-idea-at-the-time government policies. And there is the recurring phenomenon of folks who report and comment on academic papers without reading and/or understanding them.
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I had it all figured out. Last week’s review/roundup of the Carnival of Personal Finance went well, so I thought I’d do it again this week. I planned to spend yesterday leisurely reading through the posts and writing it up in time to get it posted nice and early today.
Not so much. The carnival only appeared this morning, leaving me just a few hours to run through it. Yes, I could have come up with another post idea yesterday, but, you see, I had a plan.
This week’s carnival is hosted by Green Panda Treehouse. Is that blog name a cultural reference that everybody who is younger than I am gets? There is a picture of a green panda on the banner, which helps me. I thought it was the tree house that was green.
There are five editor’s picks, two of which are on finance related marital problems and two of which discuss how expensive it is to own a house. Something on your mind Green Panda?
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There is a very amusing site that bills itself as "entertainment shopping" called Swoopo. After a brief investigation, I have concluded that:
1. You would have to be a complete idiot to spend money on this site.
2. I am a complete idiot for not thinking of it first.
How Swoopo works is deceptively simple. They auction off desirable items such as notebook computers and big flat screen TVs. But the auctions have some very special rules. It costs $0.75 to place a bid. Bids can only top previous bids by a certain small amount, usually $0.15 but in some cases only $0.01. There is no fixed end time for the auction. It continues until nobody has bid for 20 seconds.
Get it?
This is an amusingly profitable deal for Swoopo. Although they wind up selling the merchandise for much less than it is worth, the bidding fees collected swamp the small loss involved. For example, yesterday morning the bidding on a Sony Playstation 3 worth (Swoopo tells us) $399.99 sold for $126.60. That’s a nominal loss of $273.39 from retail. But to get to $126.60 in $0.15 increments took 844 bids, representing $633 in revenue to Swoopo. Brilliant.
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it had a few sentences I keep rereading.
Investing, PF Blogs | Frank Curmudgeon | 
August 12, 2009 11:59 am | 
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