Derek Foster

Asset allocation, risk, diversification and rebalancing. Pros/cons of hiring a financial advisor. Seeking advice on your portfolio?
stopwork
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Re: Derek Foster

Post by stopwork »

Altared wrote:
I disagree to some extent. Canada, and all countries, need to get off the population growth model to increase GDP since the planet cannot sustain globally increasing populations. Our oceans in particular are under stress and dying with land resources not far behind. At best, our programs should look to simply stabilize our current population.
I agree GLOBALLY we need to stabilize populations and perhaps even eventually pursue a SLOW population decline policy. So I agree with the end of your quote where you state we should seek to stabilize our population. But in Canada, the fertility rate is 1.6 whereas you need a rate of 2.1 to have a stable population. Left unchecked we decline 25% each successive generation. Is that really a goal to shoot for? If not, the only two ways to bridge the gap is to either increase fertility rates (through - oh, oh, am I opening another debate...with child benefits, subsidized daycare or whatever) or else keep immigration levels very high to offset the shortfall. So that is our simple choice....continue along the path of RAPID national population decline or do one of the two above. I'm not trying to be a smart alleck here, but if people resent paying child benefits thru taxes, wait until faced with the alternatives where there are not enough tax payers to pay most of the social programs we have (let along the workers to perform the work). Of course, we can mitigate the effects somewhat by raising the retirement ages which is another direction the governments have taken recently, but some of that has been unwound with a reversal of the proposal to gradually raise OAS eligibility ages...

Sorry, I think I am adding to a discussion which is not really applicable to this blog - I apologize. I found demographics interesting for investment reasons originally and still find them interesting in and of themselves...yes, I can be a bit of a geek...

Cheers,
Derek Foster
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Re: Derek Foster

Post by stopwork »

Altared wrote:
I disagree to some extent. Canada, and all countries, need to get off the population growth model to increase GDP since the planet cannot sustain globally increasing populations. Our oceans in particular are under stress and dying with land resources not far behind. At best, our programs should look to simply stabilize our current population.
I agree GLOBALLY we need to stabilize populations and perhaps even eventually pursue a SLOW population decline policy. So I agree with the end of your quote where you state we should seek to stabilize our population. But in Canada, the fertility rate is 1.6 whereas you need a rate of 2.1 to have a stable population. Left unchecked we decline 25% each successive generation. Is that really a goal to shoot for? If not, the only two ways to bridge the gap is to either increase fertility rates (through - oh, oh, am I opening another debate...with child benefits, subsidized daycare or whatever) or else keep immigration levels very high to offset the shortfall. So that is our simple choice....continue along the path of RAPID national population decline or do one of the two above. I'm not trying to be a smart alleck here, but if people resent paying child benefits thru taxes, wait until faced with the alternatives where there are not enough tax payers to pay most of the social programs we have (let along the workers to perform the work). Of course, we can mitigate the effects somewhat by raising the retirement ages which is another direction the governments have taken recently, but some of that has been unwound with a reversal of the proposal to gradually raise OAS eligibility ages...

Sorry, I think I am adding to a discussion which is not really applicable to this blog - I apologize. I found demographics interesting for investment reasons originally and still find them interesting in and of themselves...yes, I can be a bit of a geek...

Cheers,
Derek Foster[/quote]
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Re: Derek Foster

Post by stopwork »

Insomniac wrote:
I tend to agree with AltaRed's view. It's off topic for this thread, but I would find the views of FWF members in a new thread on ZPG and the effect on the economy interesting. Here's one view:
I guess we can just watch a real life experiment with what has happened to Japan since the early 90s to see how this all plays out. Here is a country where fertility rates have dropped precipitously to the point where it has the oldest population in the world (ignore small sub-populations). Remember in the 80s (for those old enough to remember) how Japan Inc was going to take over the world? They bought the Rockefeller Centre, Pebble Beach, etc. Back To The Future depicted the main character as being fired from his Japanese boss. I studied business in the early 1990s, and I remember hearing how the Japanese do EVERYTHING better! The Nikkei soared and Tokyo real estate was worth more than all of California. Japan has basically no immigration to speak of, so their population has just gotten older. How have Japanese shares done since 1990? How about real estate there? Economic growth? Funny, we here about stagnation in Japan and nobody seems worried about them taking over the world any more....why do you guys think that is the case?

Cheers,
Derek Foster
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Re: Derek Foster

Post by stopwork »

Kcowan wrote:
My point is that the government has been dribbling away our tax dollars on economic immigrants since the 80s on the assumption that everyone is ethical. That turned out to be a bad assumption and in 2018, it is being proven to be bad for the population of Canada. Yet they still are not moving on it.

(In the most recent case publicized in Vancouver, the rich Chinese owner of a multi-million dollar home declared their worldwide income as $97! So where was the CRA to look after the interests of Canada by enforcing their own rules?)
I am not familiar with the specifics of this but would not want to argue with you on it. Governments for the most part are very poor managers of resources in so many ways for a variety of reasons. Although there is a role for government, in Canada (and most western countries), it has reached the point of silliness - these huge bureaucracies have become so big to the point that we have to work half the year (as a group) to keep them fed. The ultimate form of democracy is for people to independently make the day to day decisions in their lives and vote with their own dollars. Of course there is a need for government regulation in some areas and also some programs for the poor, but only to a point. But I cannot see things ever changing because special interests each lobby for their own benefits and the majority simply ignore and move on...

Cheers,
Derek Foster
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Re: Derek Foster

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stopwork wrote: 25 Jan 2018 19:51 Thanks for the "well done", I think? One thing I do take exception to is classifying anyone who bought any of my books as "idiots" (as I'm the Idiot Millionaire, lol). In seriousness, when I was writing my first book, I had a few people read it, and one comment came to me with the question, "What's a dividend?" I understand on this board that this comment might classify someone as an "idiot" in your eyes, but everyone has areas where they are knowledgeable and areas where they are weaker. Ignorance in one area DOES NOT make one an "idiot". My books were targeted to beginner investors who were being gouged on investment fees buying high MER mutual funds and the like. I have received a number of emails over the years mentioning how my books have helped people navigate investing. But I mean really - why pay a 2.5% MER to buy the banks, pipelines, telcos, etc - why not simply buy them directly and save the fees? Simple knowledge that emancipated beginner investors was one of the reasons my books reached so many people, imo.

Cheers,
Derek Foster
OK then. Let's call them "not very bright" and leave it at that. Obviously you are aware that your books are in libraries and probably on the internet if one wanted to do some searching, so there is no need to actually purchase them. I only looked at your first book and I really could not see any reason to need to look at it again, so owning it was not necessary. It was a good piece of work, for the beginner investor, although I doubt it would retire many of them at 34. That part was sensation to sell books and I have no problem with it. Actually I admire it.

Again. Just my opinion. Many people may want to reward you for your work and perhaps a few might want to read it a few times, and others might not even have a library card, so perhaps the library does not work well for them. I, on the other hand, have no problem with the library. It is the greatest copyright infringer of all time, but for some reason it is legal and I have had a library card since I was probably 8.

Good luck to you. I do respect your business model and your integrity.
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Re: Derek Foster

Post by couponstrip »

I am not an economist, but broadly looking at it, I can see how allowing a population to age without replacement is not the road to prosperity. Our elderly population has to be the highest expense for our country and no longer contribute significantly to government revenue as they did in their working years. An oversized elderly population would be a problem. To support our economy and social programs, I would think that we would need a constant renewal of not only the labour to work in private and public industry at a reasonable wage, but also maintain the tax base to fund our programs.

In Canada, we do not have the birth rate to maintain our population, tax base, and fill these jobs. So we rely on immigration. That's fine, but there is no guarantee that a pool of educated/able immigrants exists forever.

Imagine the wage inflation and shrinking tax base/gov revenue/increase in taxes without immigrants to work these jobs, pay their income taxes, and spend their money to help drive the economy. Prices/wages are set at the margins, and it wouldn't take much of a lack of balance to create economic unrest increasing taxes and inflation rates to a point that would make every retiree beg for mercy.

So I applaud government programs that reward families and encourage people to have children. Children are a truly valuable resource and will provide many nice returns to our country. That someone wants to have seven is remarkable and worth even more applause. It's a lot of work. Those kids, on average, will provide economic benefit to this country well beyond whatever child benefit the gov pays out when they are young. And hopefully they will have kids of their own to help maintain the economic balance for my children and grandchildren.
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Re: Derek Foster

Post by couponstrip »

I would also submit that a father of seven is not retired in any sense of the word. Unless he is living in a different residence and has hired someone else to do the parent duties, his time is not his, but rather his family's. The freedom to really live like a retiree is likely 10-20 years hence.

Again, hats off to you, Derek Foster.
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Re: Derek Foster

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Amazing how when someone does something a bit different from the media-fed corporate work mindset that they are criticized. Is Foster guilty of hyperbole? Probably yes. Is he guilty of anything else? I doubt it. Especially in this social media driven time, the slightest deviation from some perceived 'norm' is trashed - guilty until proven innocent. I, for one, am not buying it at all.

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Re: Derek Foster

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Optsyeagle wrote:
OK then. Let's call them "not very bright" and leave it at that. Obviously you are aware that your books are in libraries and probably on the internet if one wanted to do some searching, so there is no need to actually purchase them. Again. Just my opinion. Many people may want to reward you for your work and perhaps a few might want to read it a few times, and others might not even have a library card, so perhaps the library does not work well for them. I, on the other hand, have no problem with the library. It is the greatest copyright infringer of all time, but for some reason it is legal and I have had a library card since I was probably 8.


I don't agree here. I mean my wife and I went out to lunch the other day and it cost us $30...I supposed we could have just went to Costco and walked around and eaten the free samples instead - would our choice now make us "not very bright" for paying instead of getting food for free? For a lot of people with busy lives, 20 bucks is not a huge sum to be able to read a book at your leisure instead of having to find time in a busy schedule to read it on the library's schedule. I do agree with you and love the libraries as well - although I have bought a number of investment books over the years, I have also used the library a LOT too. In fact, when I first published my books that was one of the first places I approached to carry them...I don't think it is copyright infringement at all, as they do pay for the books and then lend them out (the same way as once you buy a book you have the freedom to lend it to your friends if you like). I also have used VALUE LINE a lot there -one of my favourite resources...
Good luck to you. I do respect your business model and your integrity.
Thank you and good luck to you as well. This is one of the things I do like about investing - it is not a negative sum game like lottery tickets or a zero sum game like a poker game, but a positive sum game where all participants could theoretically be made better off by participating in the growth of the economy. I know this is not how it works in real life, but greater financial literacy would help us move towards that goal, so boards like this serve that purpose to a degree. Thanks for contributing.

Cheers,
Derek Foster
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Re: Derek Foster

Post by OptsyEagle »

stopwork wrote: 01 Feb 2018 10:26
I don't agree here. I mean my wife and I went out to lunch the other day and it cost us $30...I supposed we could have just went to Costco and walked around and eaten the free samples instead - would our choice now make us "not very bright" for paying instead of getting food for free?


If it was the identical food, served the identical way, then yes, I would say you were not very bright to pay for it.
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Re: Derek Foster

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OptsyEagle wrote:If it was the identical food, served the identical way, then yes, I would say you were not very bright to pay for it
Your original claim was that people who bought my book were "not very bright" because they could get it at the library. In this statement regarding my food analogy, you've added the pre-condition that if the food was "served in the identical way". This means to me that you MIGHT accept the idea of someone paying money for the "way it was served" (for example, sitting at a restaurant might be superior to walking around Costco and hence the money spent might be worth it in your eyes) and so you would not necessarily call these people "not bright". Isn't this the same pre-condition with the library? I mean at the library you cannot read it at your leisure but have to return it at a certain date. Sometimes the books are out and you have to go on a waiting list, whereas by purchasing it directly there is no wait. The book is not "served in an identical way", so why would readers of a book who choose to pay for this convenience be "not very bright" in your eyes but people who pay for food served in a different way okay and can still be considered bright?

Cheers,
Derek Foster

Quote fixed to follow forum norms. Extra formatting removed as too much bold type on a page can be distracting and even disruptive to the reading process. -- Administrator
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Re: Derek Foster

Post by OptsyEagle »

In my original point I gave in to the argument that if they thought they might want to look at it again then by all means go ahead and buy it. Also, if they had some ethical reason that they felt they should reward you for your work. For me that was not going to be the case.

Look. I have found in this world that there are plenty of people that do not care about $3, $30, and even $300. If they see something they want, they just buy it. To plan to acquire it at a cheaper price appears to be more work then they want to put in. In my opinion, these are not the types of people that will be able to retire at 34. I doubt they will ever find themselve's in the position to retire before 65 unless they have a good forced pension plan. Without government assistance they wouldn't ever be able to retire.

Anyway, you will do quite well selling books because you market them very well and they are an interesting read and we have a world filled with people who do not seem to care about saving money.

I am just not one of them. I doubt you are either, but I can't really speak for you but I do know that is infinitely more difficult to retire at 34 if you are not conscious about how you spend your money, so I suspect you spend a little time as well on what each item you buy is really worth and if you can get it cheaper another way.

I think we have both made our points, but let me know if you need anymore clarification of mine. I know this conversation is not helping you sell books, so I am happy to end it as soon as you are.
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Re: Derek Foster

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To OptsyEagle,

I agree that how one spends money is a HUGE factor in accumulating wealth. I just like to enjoy the fruits of my labour, so am not as "efficient" in my spending as I was years ago (ex. going to lunch with my wife, etc). In fact last year we spent stupid money going to Korea and Singapore - but time to see the family and we needed a lot of tickets. BUT, I think you made a great point here - in accumulating wealth (esp the early years), the percentage of money saved has a much bigger impact than your investment rate of return - which is why I've written about that. As your portfolio grows, saving becomes less of a factor and your rates of return become a bigger driver of financial success.

I still live frugally to a point. For example, recently we decided to get a second car as my kids are starting to drive. I wanted something safe, comfortable, and reliable - but I am an idiot about cars (don't really know too much). So I researched it at the library and decided on a Buick Lacrosse - as the resale prices drop like a rock because Buicks are "old men cars", so there is not much used car demand - but it is rated really good. Then I waited for a good deal as we were in no rush. Eventually got a 2011 Buick for $6,800 (the deal was "as is", but my mechanic checked it quickly first.) Cost $150 to safety. The car is well over $40K new, but I paid less than 7. Plan to keep it for a few years, recoup some of my money back (as depreciation is mostly behind us) and repeat. I could buy a new one, but why - this one is in great shape...I think our lifestyles might be similar in some ways...

Cheers,
Derek Foster
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Re: Derek Foster

Post by cannew »

I haven't read all the comments on this post, but no matter. I've read several of your books and enjoyed them, though not agreeing with everything. The only thing that did surprise me was your change of course and even that you sold many of your holdings rather than staying the course. But that was your choice and certainly did not change my opinion of your books.

Having said that, I also found the Connolly Report before reading your works and found his approach similar to yours but with a different objective. He just wanted to inform about DG investing and proposed three methods of evaluating ones holdings. The end objective was to grow ones income by holding a select group of stocks, add to those holdings when they were priced right and never sell unless they cut their dividend or ran into serious trouble.

We followed his advice, and yours and are happily retired and not worried if and when the next correction will come or how serious it will be.

All the best.
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Re: Derek Foster

Post by shmenge »

I have read a lot of articles and comments on Derek's story throughout the years. The latest pumpfest from Stittsville Central has given me cause to comment on their latest story. My onsite comment here;

Yes,
You left out the fact he made a highly leveraged bet on a global multinational company that allowed him to sell and then retire. He never espouses that same strategy to others. Matter of fact he never talks about how that one bet allowed him to retire. Why doesn’t he recommend others borrow money to invest? Because of one word RISK!

He would rather conveniently tell you what he’s doing now not how that bet got him to where he is. Most people can not duplicate this strategy. He also loves to call himself an idiot and lazy. It’s really an over simplification of who he is and what he does.

He has never stopped working and he is NOT retired. It then prompted me to publish this blog post;
The Lazy Simple Idiot's Guide to Investing
If you want to buy stocks why would you want them to rise in price? - Warren Buffett
The Stock Market Speculator
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