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The Long View

Updated 21 days ago

Rank #52 in Investing category

Business
Careers
Investing
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Expand your investing horizons and look to the long term. Join hosts Christine Benz and Jeff Ptak as they talk to influential leaders in investing, advice, and personal finance about a wide-range of topics, such as asset allocation and balancing risk and return.

Read more

Expand your investing horizons and look to the long term. Join hosts Christine Benz and Jeff Ptak as they talk to influential leaders in investing, advice, and personal finance about a wide-range of topics, such as asset allocation and balancing risk and return.

iTunes Ratings

235 Ratings
Average Ratings
191
22
6
8
8

Really Enjoyed the Podcast

By Sam the Giants fan - May 27 2020
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Very informative plus I liked listening to the personal edge.

Good content keeps me coming back for more

By GymRatinParis - Dec 10 2019
Read more
Really liked the last episode with Gus Sauter and looking forward to the next show.

iTunes Ratings

235 Ratings
Average Ratings
191
22
6
8
8

Really Enjoyed the Podcast

By Sam the Giants fan - May 27 2020
Read more
Very informative plus I liked listening to the personal edge.

Good content keeps me coming back for more

By GymRatinParis - Dec 10 2019
Read more
Really liked the last episode with Gus Sauter and looking forward to the next show.

Best weekly hand curated episodes for learning

Cover image of The Long View

The Long View

Latest release on Jan 13, 2021

Best weekly hand curated episodes for learning

The Best Episodes Ranked Using User Listens

Updated by OwlTail 21 days ago

Rank #1: Jeffrey Brown: Saving for Retirement 'Only Half the Puzzle'

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Our guest on the podcast today is Dr. Jeffrey Brown, the Josef and Margot Lakonishok Professor and the Dean of the University of Illinois Gies College of Business. A key focus of Dean Brown's research is how to create sustainable retirement income, including the role of annuities, Social Security, 401(k)s, pensions and long-term care planning. He's a research affiliate at the National Bureau of Economic Research, a faculty affiliate of the Institute on Government and Policy Affairs, and a fellow at the TIAA Institute. He also serves as a trustee for TIAA. In addition, he served on the Social Security Advisory Board under President George W. Bush and was also a senior economist at the White House Council of Economic Advisers. He has published extensively on the topic of retirement security and public and private insurance markets, and he has received numerous awards for his research as well. He holds a Ph.D. in economics from MIT, and a master's in public policy from Harvard.

Background

Jeffrey Brown bio

Jeffrey Brown C.V. 

Jeffrey Brown publications and working papers

Defined Contribution (DC) Plans

Defined contribution plan definition

Defined benefit plan definition

A Brief History of the 401(k), Which Changed How Americans Retire,” by Kathleen Elkins, CNBC.com, Jan. 4, 2017.

The Disappearing Defined Benefit Pension and Its Potential Impact on the Retirement Incomes of Baby Boomers,” by Barbara A. Butrica, Howard M. Iams, Karen E. Smith, and Eric J. Toder, Social Security Bulletin, Vol. 69, No. 3, 2009.

What Killed Pensions,” by Mary Beth Franklin, Kiplinger, Oct. 6, 2011.

Public Pensions Are Still Marching to Their Death,” by Jeffrey Dorfman, Forbes.com, Sept. 11, 2014.

House Passes SECURE Act to Ease 401(k) Compliance, Promote Savings,” by Stephen Miller, SHRM.org, May 23, 2019.

How the SECURE Act Would Impact Your 401(k),” by Simon Moore, Forbes.com, June 25, 2019.

Annuities in 401(k)s Won’t Solve the Retirement Crisis. Here’s Why,” by Mary Romano, Barron’s, June 28, 2019.

What Does It Mean to Annuitize?” by Justin Pritchard, Thebalance.com, Jan. 21, 2019.

Crash Course Needed: Four Out of Five Americans Fail When Quizzed on How to Make Their Nest Eggs Last,” by The American College for Financial Planning, Dec. 3, 2014.

401(k) Nudges and Course Corrections,” by Kimberly Blanton, Squared Away blog, Oct. 24, 2017.

Thank Richard Thaler for Your Retirement Savings,” by Ben Steverman, Bloomberg, Oct. 10, 2017.

Plan Quality Varies Significantly by Industry,” by John Manganaro, PlanAdviser, March 20, 2017.

Corporate Profits and 401(k) Plan Performance Go Hand in Hand: T. Rowe Price,” by Michael S. Fischer, ThinkAdvisor, Sept. 17, 2018.

“The Conundrum of State-Run Retirement Plans,” by Terry Dunne, InvestmentNews, May 8, 2017.

Reasons to Be Wary of State-Run Retirement Plans,” by Jeffrey Brown, Forbes.com, Feb. 10, 2014.

Multiple Employer Plan (MEP) definition

How Hard Should We Push the Poor to Save for Retirement?” by Andrew G. Biggs, The Journal of Retirement, Spring 2019.

Thrift Savings Plan


Annuities

Use Annuities to Protect Yourself from Yourself,” by Jeffrey Brown, Forbes.com, May 22, 2014.

Income Annuities Provide Retirees Longevity Protection,” by Wade Pfau, Investment News, Sept. 28, 2019.

Why Don’t People Insure Late-Life Consumption? A Framing Explanation of the Under-Annuitization Puzzle,” by Jeffrey R. Brown, Jeffrey R. Kling, Sendhil Mullainathan, and Marian V. Wrobel, National Bureau of Economic Research, January 2008.

Variable annuity definition

Equity-indexed annuity definition

Deferred payment annuity definition

The Main Types of Annuities Made Easy,” by Clair Boyte-White, Investopedia, July 27, 2019.

Annuities and Inflation Risk,” by Robert Bloink and William H. Byrnes, ThinkAdvisor, Sept. 3, 2011.

Lifetime Income for Women: A Financial Economist’s Perspective,” by David F. Babbel, Wharton Financial Institutions Center Policy Brief, Aug. 12, 2008.

Jeff Brown Tackles Tough Annuity Questions,” by Michael Finke, ThinkAdvisor, Sept. 29, 2014.

Annuities and Individual Welfare,” by Thomas Davidoff, Jeffrey Brown, and Peter Diamond, The Center for Retirement Research at Boston College, May 2003.

Behavioral Impediments to Valuing Annuities: Complexity and Choice Bracketing,” by Jeffrey R. Brown, Arie Kapteyn, Erzo F.P. Luttmer, Olivia S. Mitchell, and Anya Samek. National Bureau of Economic Research, Oct. 11, 2019.

Intertemporal choice definition


Long-Term Care

Does Medicare Cover Long-Term Care?Medicare.com

"Insuring Long-Term Care in the U.S.," by Jeffrey Brown and Amy Finkelstein, National Bureau of Economic Research, September 2011.

The Interaction of Public and Private Insurance: Medicaid and the Long-Term Care Insurance Market,” by Jeffrey R. Brown and Amy Finkelstein, National Bureau of Economic Research, October 2004.

Can Increasing The Long-Term Care Insurance Elimination Period Make Coverage Appealing Again?” by Michael Kitces, Nerd’s Eye View, Jan. 7, 2015.

Long-Term Care Financing Project

Hybrid Long-Term Care Policies,” by Wade Pfau, Forbes.com, Jan. 21, 2016.

“Is the LTC Cost Guarantee of Today's Hybrid Life/LTC or Annuity/LTC Insurance Policies Just a Mirage?” by Michael Kitces, Nerd’s Eye View, Oct. 16, 2013.

Life-LTC Hybrid Sales Level Off: LIMRA,” by Allison Bell, ThinkAdvisor, July 22, 2019. 


Social Security

Social Security Trustees’ Summary Report, 2019.

How Would You Fix Social Security?” The Center for Retirement Research at Boston College.

How the Latest Report on Social Security’s Solvency Changes Your Retirement Plan,” by Bob Carlson, Forbes.com, May 24, 2019.

Nov 27 2019

55mins

Play

Rank #2: Charles de Vaulx: Why Value Investing Has Slumped but Will Rebound

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Our guest on the podcast this week is Charles de Vaulx. De Vaulx is chief investment officer and portfolio manager at International Value Advisers, where he is also a partner. With his colleague Chuck de Lardemelle, de Vaulx manages the IVA International and IVA Worldwide strategies. Before joining IVA in 2008, de Vaulx had been the portfolio manager of First Eagle Global, First Eagle Overseas, First Eagle U.S. Value, and First Eagle Variable. For his accomplishments, Morningstar has recognized de Vaulx several times in the past, awarding him and his comanager our International-Stock Manager of the Year Award in 2001 and nominating them for the same award in 2006. De Vaulx began his career at Societe Generale Bank as a credit analyst in 1985. He graduated from the Ecole Superieure de Commerce de Rouen and holds the French equivalent of a master's degree in finance.

Background

Charles de Vaulx bio

Charles de Lardemelle bio

IVA Worldwide IVWIX

IVA International IVIOX

References

Modern monetary theory (MMT) definition

Herfindahl-Hirschman Index (HHI) definition

Creative destruction definition

A History of Interest Rates, by Sidney Homer and Richard Sylla; 2007

"The Irresistible Charm of the Family Factor," by Credit Suisse, Sept. 27, 2017

Jean-Marie Eveillard bio

"The Superinvestors of Graham-and -Doddsville," by Warren Buffett, Columbia Business School, May 17, 1984

Berkshire Hathaway 2013 shareholder letter, Page 20

Edward O. Thorp bio

Superforecasting: The Art and Science of Prediction, by Philip E. Tetlock and Dan Gardner, 2016

Nov 20 2019

58mins

Play

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Rank #3: The Best of The Long View Podcast: Conversations with Financial Advisors and Retirement Researchers

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On this week’s episode of The Long View, we’ll recap some of our favorite moments from the podcast so far. 

Since the podcast’s launch in May 2019, we’ve had the chance to talk to some of the best portfolio managers, retirement researchers, and financial planners and advisors in the business. It’s been a treat to spend an hour each week chatting with them, and we’ve learned a great deal from each of the interviews. 

Last week’s episode included highlights from our interviews with portfolio managers. This week, we’ll feature some of our favorite clips from interviews with financial planners, advisors, and retirement researchers.

William Bernstein: 'If You've Won the Game, Quit Playing'

Jonathan Clements: 'It's in Wall Street's Interest to Make Everyday Investors Think That They Are Stupid'

Allan Roth: 'I Embrace Dumb Beta'

Josh Brown: 'Standardize the Process, Personalize the Advice'

Carolyn McClanahan: 'There's More to Money Than Just Numbers'

Sheryl Garrett: 'The Industry Thought I Was Nuts'

David Blanchett: 'If You're Retiring Now You're in a Pretty Rough Spot'

Michael Finke: Here's What Makes Retirees Happy

Archive of all Long View episodes so far

Dec 30 2019

31mins

Play

Rank #4: Michael Kitces: The Model Has to Change Again

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Our guest on this week's podcast is Michael Kitces. Michael is a partner and the director of wealth management for Pinnacle Advisory Group, a Columbia, Maryland-based wealth management firm that advises on about $1.8 billion of assets. In addition, he is a co-founder of the XY Planning Network. As the host of the Financial Advisor Success podcast and the publisher of the popular financial planning industry blog Nerd's Eye View, Michael has established himself as one of the most prolific and insightful commentators on the financial advice business. A fixture on the speaking circuit and in the media, Michael often addresses key trends and innovations in the way advisors serve their clients; our interview with him focused on the future of the financial advice business. 

Show Notes and References

Background and Professional Development
Michael’s formative years: “The only thing I really think I figured out by the end of college was … that I didn’t want to do psychology, theater, or medicine” (0:59-2:51) 

Dad’s old life insurance policy: How a wedding gift led Michael down a path to a career in the financial services industry (2:52-4:21) 

“He was just a really different guy than everybody else”: Michael’s recounts his breakthrough realization that he wanted to be a financial planner (4:22-6:07) · 

How Michael used his pre-med training to overcome a crisis of confidence that he didn’t know what he was doing: “I probably shouldn’t be giving them advice; I’m going to hurt someone” (6:08-7:31) 

Going deep to differentiate: “I’m going to get really good at these annuity benefit riders” (7:32-8:45)

Persuasion: Using psychology and coaching to help clients overcome their biases (11:41-13:01)

“Most of us just don’t want to say that about ourselves”: Clients don’t hire us to save them from themselves, but to get on a better path and save time (13:02-16:37)

“Zoom the camera out a little bit”: The key to helping clients through difficult times is being available, clearly communicating, and setting context (16:38-18:18)

“There’s very little research at all about what you’re actually supposed to do about this stuff” (18:19-19:56)

Financial Advice: Evolution and Great Leaps
“Disturbingly like clockwork”: Technology’s role in propelling financial-advice from stock-brokering to the mutual-fund era to asset-allocation models (19:57-22:14)

Computers disrupted the stock-broker model and the internet disrupted the mutual-fund model. Michael on why he thinks software will disrupt the fee-based asset-allocation model (22:15-24:06)

An S&P 500 index fund just for you: “Technology is going to allow us to completely disintermediate not just mutual funds but most of the ETF complex as well” (24:07-25:36)

The Future of Advice
“If we can do that with medicine and we can do this with clothing, we can do this with at least large portion of financial advice as well”: Michael on delivering advice virtually (25:37-30:25)

“(Saying) ‘Oh no one’s ever going to want to work with an advisor virtually; it’s all in person’ … is like clothing stores insisting that Amazon was no threat to them 20 years ago” (30:26-32:56)

Technology leaps like robo-advice are less of a threat to the financial advisor than to the the back- and middle-office that supports them (32:57-33:54)

The great inversion: In the future, advisors will charge for financial-planning services and give away investment management for free (vs. today where the opposite often holds true) (33:55-35:36)

Best Practices for Delivering and Paying for Advice
“We still have a huge industry gap”: Not even 30% of financial advisors have achieved a baseline financial-planning designation—the CFP mark (35:37-39:20)

A question of when, not if, more exacting financial-advice standards will arrive: “The U.S. has become a laggard on fiduciary and competency standards” (39:21-43:21)

We can’t do financial advice for young people? Michael on why that’s ridiculous and how flat-fee or subscription-based advice will come to fill that void (43:22-46:51)

“I don’t … see anything wrong with the AUM model”: Why charging a percentage of assets-under-advisement makes sense for some clients, but will become less common in the future (46:52-48:56)

When it does and doesn’t makes sense to pay for financial advice by the hour (48:57:51:47)

About the Podcast: The Long View is a podcast from Morningstar. Each week, hosts Christine Benz and Jeff Ptak conduct an in-depth discussion with a thought leader from the world of investing or personal finance. The podcast is produced by George Castady and Scott Halver.

About the Hosts: Christine Benz and Jeff Ptak have been analysts and commentators on investments and the investment industry for many years. Christine is Morningstar's director of personal finance and senior columnist for Morningstar.com. Jeff is head of global manager research in Morningstar Research Services, overseeing Morningstar's team of 120 manager research analysts in the U.S. and overseas.

To Share Feedback or a Guest Idea: Write us at TheLongView@morningstar.com

Jun 05 2019

54mins

Play

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Rank #5: The Best of The Long View Podcast: Conversations with Portfolio Managers

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On this week’s episode of The Long View, we recap some of our favorite moments from the podcast so far.

Since the podcast’s launch in May 2019, we’ve had the chance to talk to some of the best portfolio managers, retirement researchers, and financial planners and advisors in the business. It’s been a treat to spend an hour each week chatting with them, and we’ve learned a great deal from each of the interviews. 

This week’s episode includes highlights from our interviews with portfolio managers and investment strategists. Next week, we’ll feature some of our favorite clips from interviews with financial planners, advisors, and retirement researchers.

Bill Nygren: 'A Stock That Doesn't Look Cheap on the Surface Might Be One of the Cheapest'

Rob Arnott: Don't Sleep on Value Investing (Especially Emerging-Markets Value)

Rupal Bhansali: FAANG Stocks Are 'Extremely Risky'

Dan Ivascyn: Building a Portfolio to Bend but Not Break

Ben Johnson: Index Funds Are Not 'Zombie Investors'

Dana Emery: You're Not Getting a Valuation Discount for Free

Dennis Lynch: 'Have a Growth Mindset and Be Willing to Learn New Things'

Charles de Vaulx: Why Value Investing Has Slumped but Will Rebound

Dec 23 2019

41mins

Play

Rank #6: Maria Bruno and Joel Dickson: 'Building a Better Retirement'

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Our guests for the latest installment of "The Long View," Maria Bruno and Joel Dickson, are both veterans of investment behemoth Vanguard. 

Bruno is the head of U.S. wealth planning research at Vanguard, leading a team responsible for conducting research and analysis on a wide range of retirement, wealth planning, and portfolio construction topics. She also contributes to the oversight of the investment philosophy, methodology, and wealth management strategies supporting Vanguard's advisory products and services. Bruno is a Certified Financial Planner, and she's a fount of wisdom on many subjects, but especially retirement planning. 

Dickson has worn many hats at Vanguard during his long career there. In his current position as Vanguard's global head of advice methodology, he oversees all investment methodology development for Vanguard's advice programs whose end consumers are individual investors. 

The transcript for this podcast can be found here.

Background Information

How Retirement Savers Can Play Catch-Up
"It's the 'how much?' But then also how do you actually direct those savings?" (1:30-2:56)

"It's such an idiosyncratic or individual sort of consideration from a planning standpoint; there are plenty of people that have little wealth but high income." Whether traditional tax-deferred accounts are automatically better than Roth for people playing catch-up on retirement savings. (2:57-5:53)

"It's a little bit simpler when you're younger and accumulating." How basic savings and investing habits, combined with plan defaults, make the accumulation period much simpler than decumulation. (5:54-8:24)

'Off-Label Uses': Ways Supersavers Can Maximize Their Investments Aftertax
401(k): What it is and how heavy savers can take advantage of it. (10:41-12:55)

Backdoor Roth IRA: How it works, who should consider, and potential pitfalls to be aware of. (12:56-16:34)

"There's more and more focus on minimizing income taxes during one's life than there is about avoiding estate taxes." Using a 529 as an additional tax-advantaged savings vehicle. (16:35-21:26)

Decumulation
"How do I meet my goals today but then also make sure that I'm protecting myself down the road?" Why setting spending rates can be so tricky. (21:27-24:26)


"We're telling people to, on average, oversave and underspend." Balancing longevity, sequence risk with spending and quality of life. (24:27-28:35)

"At the end of the day you still kind of get to the same end result." How bucket portfolios may not look very different from traditionally allocated retirement portfolios. (28:36-31:30)

"Retirees could be overexposed to equity risk." Whether retirees aren't derisking their portfolios. (31:31-32:41)

"The rules of thumb just don't work as well." Why managing taxes during retirement is necessarily an individualized process. (32:42-36:24)

"Here you're actually looking at strategies that could accelerate income taxes." How the post-retirement/pre-RMD years are a prime time to control future tax bills. (36:25-39:41)
• "An IRA Conversion Sweet Spot," Morningstar.com video 
• "Age Is Just a Number: Start Thinking About RMDs Now," Vanguard blog post
• "Strategies for Annual Roth Conversions," Vanguard research
• "But What If I Don't Want My RMD?," Vanguard research
• "What to Do With RMDs You Don't Need," Morningstar.com article 

Building Portfolios
"You have human capital risk at the same time you have investment risk." How investors should think holistically about risk when building their portfolios. (39:42-44:37)

"Focus on the things that you can control." What to do if investment returns are muted in the future. (44:38-46:23)

ETF Landscape
"Investors that were more likely to trade chose the ETF." Are ETFs being used for long-term investing or trading? (46:24-49:28)

"98% of the DNA is the same." Whether the benefits of ETFs relative to traditional index funds been overstated. (49:29-51:27)

Vanguard's Personal Advisor Service
"The most important part of the financial planning process is the goal discovery." Why Vanguard's service offers a combination of human and automated advice. (51:28-56:17)

About the Podcast: The Long View is a podcast from Morningstar. Each week, hosts Christine Benz and Jeff Ptak conduct an in-depth discussion with a thought leader from the world of investing or personal finance. The podcast is produced by George Castady and Scott Halver.

About the Hosts: Christine Benz and Jeff Ptak have been analysts and commentators on investments and the investment industry for many years. Christine is Morningstar's director of personal finance and senior columnist for Morningstar.com. Jeff is head of global manager research for Morningstar Research Services, overseeing Morningstar's team of 120 manager research analysts in the U.S. and overseas.

To Share Feedback or a Guest Idea: Write us at TheLongView@morningstar.com

Jul 24 2019

58mins

Play

Rank #7: Josh Brown: 'Standardize the Process, Personalize the Advice'

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Our guest on this week's episode of the Long View is none other than Josh Brown, CEO of Ritholtz Wealth Management. Brown's story is unique and inspiring. He began his career as a broker but grew disillusioned with the industry's skewed incentives and practices, eventually pursuing a career as an independent Registered Investment Advisor. Along the way, Brown managed to author an acclaimed book, Backstage Wall Street, and build an enormous following around his blog, "The Reformed Broker," as well as his twitter handle, @reformedbroker. Now he oversees Ritholtz's day-to-day operations in addition to his other duties, which include serving as a regular contributor on CNBC, as a member of fintech firm BrightScope's advisory board, and most recently as a technical advisor on the Showtime hedge fund drama Billions.

Introduction and Background

Origin Story
"A personal crisis." Josh describes the epiphany he had in leaving the brokerage industry for the advice business after 10 years (1:20-3:41).

"It worked immediately." How the Reformed Broker blog was born and led to a chance meeting with Barry Ritholtz, which gave rise to an RIA (3:42-5:21). 

The Advice Business
"If they haven’t figured it out by now, they probably don’t want to." Observations on how the advice business has changed (5:22-7:29).

"Brokerages in name only." Why wirehouse clients aren't necessarily being ill-served by the system (7:30-8:09). 

Lending: The key difference between a fee-based account at a Wall Street wirehouse and a fee-based account at a traditional RIA (8:10-10:34).

How to Provide Financial Advice
Telling the client "no." The difference between pushing product and offering advice (10:35-12:16).

"It's recreation; it's not a necessity." Helping clients to scratch an itch without putting their financial plans at risk (12:17-14:53).

"Financial planning is the highest calling within our profession." Ensuring clients get past the firm's public persona and truly buy into its plan and approach (14:54-16:46).

An ensemble approach to delivering advice to clients: The anti "eat what you kill." (16:47-18:58).

How to Build an Advice Firm
"Barry and I don't spread out a map like Napoleon and start sticking thumb-tacks in it." How Brown thinks about strategically expanding the firm (19:04-20:45).

"If somebody comes to us in a rush, it's probably a bad situation, and we don't want anything to do with it." The advisor recruitment and weeding-out process (20:46-24:23).

Portfolio Construction and Asset Allocation
"You're going to lose money. It's gonna happen. There's no way around it." The firm's approach to allocating assets and setting client expectations (24:24-27:33).

Tactical asset allocation's role in their process: "We don't believe in investment alpha using tactical." (27:34-29:33) 

"What if you had a tactical model that almost never did anything?" How they built their tactical-asset-allocation overlay to help manage client behavior (29:34-33:13).

"I hope it underperforms, because most of our clients' money is not invested in tactical." (33:14-35:03)

"Every client is different, but their needs are not." Implementing a scalable asset allocation (35:04-37:08).

"You want to be wrong in such a way that it's not going to be catastrophic for the end client." How Ritholtz sets capital-markets expectations (37:09-38:41).

Managing Client Assets
How Ritholtz approaches assets that clients bring in with them: "You've got a human being with their own issues." (38:42-40:58) 

"The longer I'm doing this, the more stuff I want to take out, not add." Brown explains why they err on the side of excluding various types of investments from client portfolios (40:59-42:33).

"Our clients are here because they want us." Brown says fee pressure hasn't been an issue for the firm (42:34-44:22). 

The Future of Advice
"You're being judged on the portfolio, you should get paid on the portfolio you recommend." Brown is dubious of clients who aren't willing to pay for advice as a percentage of assets under advisement (44:23-46:50).

How a chocolatier's success reinforced the importance of consistency in client interactions: "Standardize the process, personalize the advice." (46:51-50:25) 

Jun 26 2019

53mins

Play

Rank #8: Jeff Levine: Cracking the New Retirement Code

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Our guest this week is tax and retirement planning expert, Jeffrey Levine. Jeff is director of advisor education at Kitces.com, home of the popular Nerd's Eye View blog. He's also the CEO and director of financial planning for BluePrint Wealth Alliance. Previously, Jeff served as chief retirement strategist at Ed Slott and Company. He has authored several books including, The Baby Boomer's Guide to Savvy IRA Planning, The Financial Advisor's Guide to Savvy IRA Planning, and The Definitive Guide to Required Minimum Distributions for Baby Boomers. Jeff is a frequent public speaker and media commentator, and he maintains a high profile on social media and on the Nerd's Eye View blog, where he readily shares tax and retirement planning insights.

Background

Jeffrey Levine bio


Kitces.com


Blueprint Wealth Alliance


Jeffrey Levine on Twitter: @CPAPlanner


SECURE Act: Stretch IRA

SECURE Act text

Stretch IRA definition

SECURE Act And Tax Extenders Creates Retirement Planning Opportunities and Challenges,” by Jeffrey Levine, Kitces.com, Dec. 23, 2019. 


Navigating the Secure Act: What Retirement Savers Need to Know to Optimize Their 401(k)s and IRAs,” by Reshma Kapadia, Barron’s, Dec. 20, 2019. 


“New Retirement Law Throws IRA Heirs a Curveball,” by Mark Miller, Morningstar.com, Jan. 21, 2020. 


Inheriting a Parent’s IRA or 401(k)? Here’s How the Secure Act Could Create a Disaster,” by Alessandra Malito, MarketWatch, Jan. 9, 2020. 


Who Should Consider a Roth Conversion Under the SECURE Act?,” by Liz Weston, MarketWatch, Feb. 1, 2020. 


The Stretch IRA Strategy Is Largely Gone. Here Are 5 Alternatives to Consider,” by Cheryl Winokur Munk, Barron’s, Feb. 8, 2020. 


Charitable trust definition


SECURE Act: RMD Age Change

Required minimum distribution definition

IRA Required Minimum Distribution Worksheet

How Required Minimum Distribution (RMD) Changes Under The SECURE Act Impact Retirement Accounts,” by Jeffrey Levine, Kitces.com, Jan. 8, 2020. 

Why the SECURE Act Makes 2020 the Year of Missed RMDs from IRAs,” by Jamie Hopkins, Forbes.com, Dec. 18, 2019. 


“Could Later RMDs Lower Your Tax Bill?” by Christine Benz, Morningstar.com, Feb. 3, 2020. 


Updated Life Expectancy and Distribution Period Tables Used for Purposes of Determining Minimum Required Distributions,” (proposed rule by the IRS), IRS.gov, Nov. 8, 2019.

SECURE Act: Qualified Charitable Distributions

How to Reduce Your Taxes and AGI by Giving to Charity,” by Mark P. Cussen, Investopedia.com, Jan. 16, 2020.


Coordinating QCDs with Post 70 1/2 IRA Contributions Under the SECURE Act,” by Jeffrey Levine, Kitces.com, Jan. 22, 2020. 


Tax Cuts and Jobs Act of 2017


Adjusted gross income definition


SECURE Act: Traditional IRA Contributions After 72

The Kaye Bailey Hutchison Spousal IRA Receives Congressional Agreement,” by Beverly DeVeny, irahelp.com, Aug. 9, 2013. 


SECURE Act: Open MEPs

Could Multiple-Employer Plans Be a Game Changer for Retirement Security?” by Aron Szapiro, Morningstar.com, Dec. 19, 2019. 


Secure Act’s MEP Changes Are a Game Changer for 2020,” by Robert Bloink and William H. Byrnes, ThinkAdvisor, Jan. 8, 2020. 


“The New American Retirement Plan,” by John Rekenthaler, Morningstar.com, Jan. 14, 2020. 


“Replacing 401(k) Plans: Further Thoughts,” by John Rekenthaler, Morningstar.com, Jan. 21, 2020. 

SECURE Act: Annuities in Company Retirement Plans

"What the SECURE Act Means for Annuities," by Jamie Hopkins, InvestmentNews, Dec. 17, 2019.

Security Act’s 401(k) Annuity Options: The Pros and Cons,” by William H. Byrnes and Robert Bloink, ThinkAdvisor, Jan. 14, 2020.  

Feb 12 2020

56mins

Play

Rank #9: Morgan Housel: No One Hires a Luck Manager

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Our guest for this week's installment of The Long View podcast is Morgan Housel. Morgan is a partner at the Collaborative Fund, a venture capital firm that makes investments in firms that in its words are "at the intersection of for-profit and for-good." A former columnist at The Motley Fool and The Wall Street Journal, Morgan has become one of the most prolific and insightful writers on the investment decision-making process, as evidenced by his impressive body of work on the Collaborative Fund website's blog.

Morgan joined us in this live recording of The Long View from the 31st annual Morningstar Investment Conference in Chicago. Our interview covered a lot of ground, from how Morgan found his way into the finance world, to the role he plays at Collaborative Fund, to a host of other personal and behavioral finance topics that draw on his work.

Show Notes
The accidental writer: Morgan's background and how he came to write about financial topics (0:55-3:04)

"The ability to write a check is no longer a competitive advantage": What Collaborative Fund does, why Morgan was drawn to it, and the role content plays in its strategy (3:05-5:05)

Authorial license: "It's really important to write what … you yourself would find interesting" (5:06-5:58)

Transparency and impact: "We're looking for companies whose ability to do good is their competitive economic advantage" (5:59-8:21)

Public vs. private investing: "If I made a Venn diagram of public and privates, the overlap is much greater than I ever thought it would be" (8:22-9:19)

Theory vs. practice: How private-market "lock-ups" can make sense for individual investors but are still inappropriate for the vast majority (9:20-10:24)

The future of public-private investing: "There's some liquidity in private markets but it’s not very efficient" (10:25-11:16)

Be honest with yourself: Don't try to fight behavioral biases which can't be eliminated anyway; work around them (11:17-13:13)

"That's what works for me": How Morgan reckons with his own behavioral biases (13:14-13:44)

Financial advisors' job one? Don't allow events or emotions to interrupt compounding (13:45-15:52)

History and psychology: "The most important intersection in investing" (15:53-18:24)

Scarred, not complacent: Investors are still licking their wounds from the global financial crisis (18:25-20:12)

You can't shake investors out of their experiences; it takes a new generation to come along (20-13-21:17)

"There’s no other industry in the world where the rewards are as big as in finance": How big paydays can distract focus from everyday work (21:18-23:42)

How fee arrangements can impact portfolio managers' risk and reward calculations (23:43-24:26)

Avoiding confirmation bias and bringing in diverse perspectives: "Find someone who you admire their thought process in one aspect of thinking … but you disagree with them about something else" (24:27-26:10)

A crank whose views Morgan respects--"Jake" on financial Twitter (@econompic) (26:11-26:45)

"No one hires a luck manager": Morgan explains how investors tend to account for risk, but not luck, in their decisions (26:46-29:17)

"Investing isn't the study of finance. Investing is the study of how people behave with money." Morgan explains why he doesn't read investing books (29:18-30:03)

How people deal with uncertainty and opportunity: The importance of content aggregators and of ditching bad books (30:04-31:14)

Perishable: Morgan's favorite non-investing book of the last few years is about how much things can change, on average, in everyday life (31:15-33:03)

"You're not proven until you've survived a calamity": Why it’s so hard to distinguish skill from luck (33:04-35:16)

Good advice (that Morgan doesn't follow himself): Carry a little bit of debt to hone your focus (35:17-36:56)

"You have to pay the fee": How thinking of volatility as an ongoing price for the opportunity to grow capital can help investors put risk in the right context (36:57-38:56)

Are investors giving up on investment skill? Yes, but that’s probably OK (38:57-40:41)

The importance of financial planning: Telling clients the truth (i.e., that they're not on a path to a secure, comfortable retirement, not matter how much they want to believe otherwise) (40:42-43:09)

On Jack Bogle: "The biggest undercover philanthropist of all time." (43:10-44:48)

What matters is how well you behave: The psychology of investing (44:49-45:41)

References
The Collaborative Fund blog
Morgan Housel’s collected works
Morgan Housel, bio
“You Played Yourself” by Morgan Housel (Apr. 24, 2019)
“You Have to Live it to Believe It” by Morgan Housel (Apr. 9, 2019)
“Useful and Overlooked Skills” by Morgan Housel (May 1, 2019)
Jake (@econompic) and Econompic
Patrick O’Shaughnessy, “The Investor’s Field Guide”
Abnormal Returns
“The Big Change: America Transforms Itself 1900-1950” by Frederick Lewis Allen
Books recommended by Charlie Munger
“Origins of Greed and Fear” by Morgan Housel (Jan. 31, 2019)
George Soros
“A Man in the Mirror” by William H. Gross (April 2013)
10-year Treasury Rate
“Counterintuitive Competitive Advantages” by Morgan Housel (Mar. 13, 2019)
“Fees vs. Fines” by Morgan Housel (Apr. 2, 2019)
“Statement of Principles” by Jason Zweig
“When You’ll Believe Anything” by Morgan Housel (Apr. 15, 2019)
Jack Bogle
Morgan Housel’s tweet about Jack Bogle

About the Podcast: The Long View is a podcast from Morningstar. Each week, hosts Christine Benz and Jeff Ptak conduct an in-depth discussion with a thought leader from the world of investing or personal finance. The podcast is produced by George Castady and Scott Halver.

About the Hosts: Christine Benz and Jeff Ptak have been analysts and commentators on investments and the investment industry for many years. Christine is Morningstar's director of personal finance and senior columnist for Morningstar.com. Jeff is head of global manager research in Morningstar Research Services, overseeing Morningstar's team of 120 manager research analysts in the U.S. and overseas.

To Share Feedback or a Guest Idea: Write us at TheLongView@morningstar.com

May 22 2019

47mins

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Rank #10: Michael Finke: Here’s What Makes Retirees Happy

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Our guest on this week’s episode of The Long View podcast is nationally renowned retirement researcher Dr. Michael Finke. Michael is Professor of Wealth Management and Frank M. Engle Distinguished Chair in Economic Security at The American College of Financial Services. He joined the College in June 2016 having served since 2006 as a professor and PhD coordinator in the department of personal financial planning at Texas Tech University. From 1999 through 2006, he served as the Director of Graduate Studies at the University of Missouri. Michael has published more than 50 peer review articles with a focus on the value of financial advice, financial planning regulation, investments and individual investor behavior. He was named to the 2012 Investment Advisor IA 25 list and the 2013 and 2014 Investment News Power 20. His research conducted with Wade Pfau, questioning the 4% rule was published in the Journal of Financial Planning and won the 2014 Montgomery-Warschauer award for the most influential article in the publication. He had previously won the award with Thomas Langdon in 2013. He was also selected to present his research on financial literacy and aging at the 2015 MIT Center for Finance and Policy Conference.

Background

Michael Finke, PhD, CFP bio
Finke CV
2013 Investment Advisor IA 25 profile
2013 Investment news Power 20 profile
Montgomery-Warshauer Award

Withdrawal Rates

“The 4% Rule is Not Safe in a Low-Yield World” by Michael Finke, Ph.D., CFP; Wade D. Pfau Ph.D., CFP; David M. Blanchett CFP, CFA; Journal of Financial Planning; June 2013

“Determining Withdrawal Rates Using Historical Data” by William ​Bengen; Journal of Financial Planning; October 1994

“Low Bond Yields and Safe Portfolio Withdrawal Rates” by David Blanchett, CFP, CFA; Michael Finke, Ph.D., CFP, and Wade Pfau, Ph.D., CFP; Morningstar Investment Management; January 2013

“Reduce Retirement Costs with Deferred Income Annuities Purchased before Retirement” by Michael Finke, Ph.D., CFP and Wade Pfau, Ph.D., CFP; Journal of Financial Planning; July 2015

“Why Advisors Should Use Deferred-Income Annuities” by Michael Finke, Ph.D., CFP; Advisor Perspectives; November 2015

“Retirement Income for Life; Here’s a New Way to Get It” by Michael Finke, Ph.D., CFP; Bottom-line Personal; July 2016

“Lifetime Income Solutions as a Qualified Default Investment Alternative (QDIA) Focus on Decumulation and Rollover”; Written Testimony of Michael Finke, Chief Academic Officer, The American College of Financial Services; 2018 ERISA Advisory Council, August 2018

Health and Cognitive Decline

“Old Age and the Decline in Financial Literacy” presented by Michael Finke at the MIT Center for Finance & Policy; September 2015

“Health and Retirement Study”; National Institute on Aging, Social Security Administration; University of Michigan’s Institute for Social Research

“Managing Long-term Care Spending Risks in Retirement” by Michael Finke Ph.D., CFP and Wade Pfau Ph.D., CFP; 2017

“Old Age and the Decline in Financial Literacy” by Michael Finke, Ph.D., CFP, John Howe, Sandra Huston; Management Science; August 2011

“Wealth Shocks and Health Outcomes: Evidence from Stock Market Fluctuations” by Hannes Schwandt; American Economic Journal; October 2018>

Retiree Spending

“Spending, Relationship Quality, and Life Satisfaction in Retirement” by Michael Finke, Nhat Ho, Sandra J. Huston; 2018 Academic Research Colloquium for Financial Planning & Related Disciplines; September 2017

“Spending in Retirement: Determining the Consumption Gap” by Chris Browning, Ph.D., Tao Guo, Ph.D., Yuanshan Cheng, and Michael Finke, Ph.D., CFP; Journal of Financial Planning

“Estimating the True Cost of Retirement” by David Blanchett, CFP, CFA; Morningstar Investment Management; 2013

Asset Allocation in Retirement

“An Old Friend: The Stock Market's Shiller P/E” by Cliff Asness; AQR; November 2012

Daily Treasury U.S. Real Yield Curve Rates; U.S. Department of the Treasury

“Reducing Retirement Income Risk with a Rising Equity Glide-Path” by Wade Pfau and Michael Kitces; SSRN; September 2013

“The Effect of Advanced Age and Equity Value on Risk Preferences” by David Blanchett, Michael Finke, and Michael Guillemette; Journal of Behavioral Finance; January 2018

Equity risk premium data; website of professor Aswath Damodaran; Stern School of Business at New York University

Other
“The Impact of the Broker-Dealer Fiduciary Standard on Financial Advice” by Michael Finke, Ph.D., CFP, and Thomas P. Langdon, J.D., LL.M., CFP, CFA; Journal of Financial Planning; July 2012

Oct 02 2019

55mins

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Rank #11: Rob Arnott: Don't Sleep on Value Investing (Especially Emerging-Markets Value)

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Our guest on the podcast today is Rob Arnott. Arnott is partner and chairman of the board of Research Affiliates, a firm he established in 2002, following stints at First Quadrant and Salomon Brothers. He also runs several prominent mutual funds, including PIMCO All Asset. In addition to these duties, Arnott is an accomplished thought leader, having published more than 100 articles in professional journals. Among other plaudits for his work, he has received seven Graham and Dodd Scrolls, awarded by the CFA Institute to the top financial analyst journal articles of the year. An innovator, Arnott popularized the concept of fundamental indexation, which some refer to as smart beta. 

Background Information

Related Links

Research Affiliates Forecasts

Research Affiliates Research

Other Research Referenced

About the Podcast: The Long View is a podcast from Morningstar. Each week, hosts Christine Benz and Jeff Ptak conduct an in-depth discussion with a thought leader from the world of investing or personal finance. The podcast is produced by George Castady and Scott Halver.

About the Hosts: Christine Benz and Jeff Ptak have been analysts and commentators on investments and the investment industry for many years. Christine is Morningstar's director of personal finance and senior columnist for Morningstar.com. Jeff is head of global manager research for Morningstar Research Services, overseeing Morningstar's team of 120 manager research analysts in the U.S. and overseas.

To Share Feedback or a Guest Idea: Write us at TheLongView@morningstar.com

(Disclaimer: This recording is for informational purposes only and should not be considered investment advice. Opinions expressed are as of the date of recording. Such opinions are subject to change. The views and opinions of guests on this program are not necessarily those of Morningstar, Inc. and its affiliates. Morningstar and its affiliates are not affiliated with this guest or his or her business affiliates unless otherwise stated. Morningstar does not guarantee the accuracy, or the completeness of the data presented herein. Jeff Ptak is an employee of Morningstar Research Services LLC. Morningstar Research Services is a subsidiary of Morningstar, Inc. and is registered with and governed by the U.S. Securities and Exchange Commission. Morningstar Research Services shall not be responsible for any trading decisions, damages or other losses resulting from or related to the information, data analysis or opinions or their use. Past performance is not a guarantee of future results. All investments are subject to investment risk, including possible loss of principal. Individuals should seriously consider if an investment is suitable for them by referencing their own financial position, investment objectives and risk profile before making any investment decisions.)

Aug 21 2019

53mins

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Rank #12: John Rekenthaler: Fund Manager Financial Incentives Are Irrelevant

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Our guest this week is John Rekenthaler. Rekenthaler is a director in Morningstar Research Services and a feature contributor to our platforms, including Morningstar.com. A lucid thinker and brilliant writer, his popular "Rekenthaler Report" column has become a must read among investors, financial advisors, fund industry participants, and beyond.

Rekenthaler began his career at Morningstar in 1988 and has worn a number of hats, including leadership roles in our research and investment management divisions. Among other achievements, Rekenthaler has been a key player in developing some of Morningstar's best-known tools, including the Morningstar Rating for funds and the Morningstar Style Box. He holds a bachelor's degree in English from the University of Pennsylvania and a master's degree in business administration from the University of Chicago Graduate School of Business.

Background

The Rekenthaler Report

Morningstar Rating for funds methodology

Morningstar Style Box methodology

Investor Behavior

Morningstar's Mind the Gap study

Rekenthaler Report: "Mutual Funds: Where Fun Came to Die"

Rekenthaler Report: "3 Reasons Index Investors Deserve Perdition (or Not)"

Rekenthaler Report: "Up-Front Investment Fees Are (Almost) No More"

Incentives

Rekenthaler Report: "Give Performance Fees a Chance"

How John Invests

Rekenthaler Report: "What's in My Portfolio?"

Most and Least Popular Columns

Rekenthaler Report: "Enough with Revenue Sharing!"

Rekenthaler Report: "About that Rigging Claim"

Flash Boys: A Wall Street Revolt, by Michael Lewis, March 2014.

Compelling Academic Research

Rekenthaler Report: "Predicting Mutual Fund Returns With the Ownership Lens"

"Judging Fund Managers by the Company They Keep," by Randolph Cohen, Joshua Coval, and Lubos Pastor; NBER Working Paper No. 9359, December 2002.

The State of Retirement

Rekenthaler Report: "The Retirement Crisis That Isn't?"

Teresa Ghilarducci

"A Perplexing Tale About 401(k)s," by Scott Cooley; Morningstar.com, Nov. 26, 2015.

Rekenthaler Report: "The British Show How to Improve 401(k)s"

Best and Worst Innovations

Rekenthaler Report: "Why ETFs Succeeded for Retail Investors"

Rekenthaler Report: "Tactical-Allocation Funds: Even Worse Than Expected"

Jack Bogle

Rekenthaler Report: "Jack Bogle Strikes Back!"

Rekenthaler Report: "Jack Bogle's (Somewhat) Accidental Legacy"

Corporate Governance

"Anticompetitive Effects of Common Ownership," by Jose Azar, Martin Schmalz, and Isabel Tecu; Journal of Finance, May 2018.

Rekenthaler Report: "Are Index Funds Too Soft on CEOs?"

Rekenthaler Report: "The Latest Salvo Against Indexing"

Rekenthaler Report: "The Doctrine of Shareholder Value Has Indeed Helped Shareholders"

Albert J. "Chainsaw Al" Dunlap  bio

What John Reads

Berkshire Hathaway shareholder letters

Joe Mansueto bio

Reflections on Investing

Rekenthaler Report: "My Investment Howler"

Jan 08 2020

51mins

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Rank #13: Rick Ferri: 'There Are No Average Investors'

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Our guest today on The Long View podcast is Rick Ferri. Ferri is an hourly fee-only investment consultant at Ferri Investment Solutions; he's also a CFA charterholder. Prior to starting his new firm in April 2019, he was the founder and head of investing at a $1.5 billion advisory firm that specialized in low-fee asset management using index funds and exchange-traded funds. Prior to that, he worked for a brokerage firm, where he was an early adopter of inexpensive index products for client portfolios. Ferri is a Marine Corps officer and retired fighter pilot.

Ferri has written several books on low-fee investing, including All About Asset Allocation, The ETF Book, All About Index Funds, and The Power of Passive Investing. He has also authored numerous investment-related articles and research papers, including a research paper on index investing that won S&P Dow Jones Indices' third-annual SPIVA Award.

Introduction and Background

"The conversation about asset allocation comes later, and the conversation about investments comes after that." Ferri discusses how his definition of value-add has changed over the past 10-15 years. (0:55-3:24)

"I've been through the whole gantlet." Transitioning from broker to Registered Investment Advisor. (3:25-5:14)

On clients who have needs that go beyond investment management. (5:15-5:56)

"You get the work done, you pay for the work." Why Ferri's new advisory practice charges clients by the hour, not by their assets under management. (5:57-9:44)

"Advisors talk about how they add value behaviorally; I think a lot of that is created by the advisor and not so much by the client." The role of advisors in managing client behavior. (9:45-11:12)

Asset Allocation

"There are no average investors." How investors of the same age can vary widely in their appetite for equity risk. (11:13-15:03)

"Those are the things that are going to add value to a client's portfolio." Focusing on keeping taxes and investment costs down, not trying to play factors. (15:03-18:21) 

"There seem to be a lot of factor renters, rather than factor owners." Ferri is skeptical that factor investing will outperform in the future. (18:23-20:44)

 "I don't use anything that doesn't have an expected real return." Why Ferri sticks with plain-vanilla asset classes. (20:45-21:56)

How to go about making return assumptions for the major asset classes. (21:57-24:14)

"It depends on how much money the client has." A total bond market index as a one-stop option for fixed-income exposure. (24:15-27:20)

International bonds as a core asset class. (27:21-28:46) 

"I don't think they're pivotal." REITs as a direct allocation.  (28:47-31:45)

Decumulation 
"The software doesn't seem to be very good at this." Decumulation is inherently more complicated and customized than accumulation. (31:46-34:19)

"There seem to be better ways of doing it than the classic way in which we've been taught." On whether the traditional declining equity glide path makes sense. (34:20-39:28)

Indexing and the Legacy of Jack Bogle
"It's been around forever." Direct indexing: the wave of the future? (39:29-42:09)

"I don't see it as big of a threat as other people do." Should investors be worried about concentration in very few ETFs, and do index funds and ETFs own too much of the market? (42:10-44:07)

"I was having a real moral dilemma." How influential Jack Bogle was in shaping Ferri's career path. (44:08-46:08)

Jul 03 2019

48mins

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Rank #14: David Blanchett: If You're Retiring Now, You're in a Pretty Rough Spot

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Our guest this week is David Blanchett, head of retirement research for Morningstar Investment Management. In his role at Morningstar, Blanchett works to enhance the Investment Management group's consulting and investment services and conducts research primarily in the areas of financial planning, tax planning, annuities, and retirement. He's also adjunct professor of wealth management at The American College of Financial Services.

Blanchett's research has been published in a variety of academic and industry journals, such as the Financial Analysts Journal, the Journal of Financial Planning, The Journal of Portfolio Management, The Journal of Retirement, and The Journal of Wealth Management. His research won the Journal of Financial Planning's 2007 Financial Frontiers Award, the Retirement Income Industry Association's 2012 Thought Leadership Award, the Journal of Financial Planning's 2014 and 2015 Montgomery-Warschauer Awards, and the Financial Analysts Journal's 2015 Graham & Dodd Scroll Award.

Background
David Blanchett's bio

David Blanchett's research archive

Quantifying the Value of Advice
Alpha, Beta, and Now ... Gamma

The Value of a Gamma-Efficient Portfolio

Vanguard Advisor's Alpha

Capital Sigma: The Advisor Advantage

Reducing Wealth Volatility: The Value of Financial Advice as Measured by Zeta

Retirement
Annuities are Likely Coming to Your 401(k). Should You Use Them?

A Safe Harbor for Annuities Could Help Retirement Savers

Save More Today: Improving Retirement Savings Rates With Carrots, Advice, and Nudges

Nudge, by Richard Thaler and Cass Sunstein

Behavioral Nudges for Goals-Based Financial Planning

You Can't Fix What You Can't Measure, Aron Szapiro on The Long View podcast

I Don't Think the System Needs Nudges. I Think the System Needs Dynamite, William Bernstein on The Long View podcast

Man Bites Dog! Congress Is Writing Retirement Legislation!

Retiree Survey: Nearly All Say They Are Happy Though Many Are Financially Insecure

Estimating the True Cost of Retirement

Exploring the Retirement Consumption Puzzle

75 Must-Know Statistics About Long-Term Care: 2018 Edition

The 4% Rule Is Not Safe in a Low-Yield World

Simple Formulas to Implement Complex Withdrawal Strategies

Reducing Retirement Risk With a Rising Equity Glide-Path

Revisiting the Optimal Distribution Glide Path

Annuitized Income and Optimal Asset Allocation

Should Annuities Be Purchased From Tax-Sheltered Assets?

The Home as a Risky Asset

Careful With That Company Stock

About the Podcast: The Long View is a podcast from Morningstar. Each week, hosts Christine Benz and Jeff Ptak conduct an in-depth discussion with a thought leader from the world of investing or personal finance. The podcast is produced by George Castady and Scott Halver.

About the Hosts: Christine Benz and Jeff Ptak have been analysts and commentators on investments and the investment industry for many years. Christine is Morningstar's director of personal finance and senior columnist for Morningstar.com. Jeff is head of global manager research for Morningstar Research Services, overseeing Morningstar's team of 120 manager research analysts in the U.S. and overseas.

To Share Feedback or a Guest Idea: Write us at TheLongView@morningstar.com

(Disclaimer: This recording is for informational purposes only and should not be considered investment advice. Opinions expressed are as of the date of recording. Such opinions are subject to change. The views and opinions of guests on this program are not necessarily those of Morningstar, Inc. and its affiliates. Morningstar and its affiliates are not affiliated with this guest or his or her business affiliates unless otherwise stated. Morningstar does not guarantee the accuracy, or the completeness of the data presented herein. Jeff Ptak is an employee of Morningstar Research Services LLC. Morningstar Research Services is a subsidiary of Morningstar, Inc. and is registered with and governed by the U.S. Securities and Exchange Commission. Morningstar Research Services shall not be responsible for any trading decisions, damages or other losses resulting from or related to the information, data analysis or opinions or their use. Past performance is not a guarantee of future results. All investments are subject to investment risk, including possible loss of principal. Individuals should seriously consider if an investment is suitable for them by referencing their own financial position, investment objectives and risk profile before making any investment decisions.)

Sep 18 2019

50mins

Play

Rank #16: Meir Statman: 'We Are All Normal'

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Our guest in the podcast today is Meir Statman, the Glenn Klimek Professor of Finance at Santa Clara University and a specialist in behavioral finance. Meir's research focuses on how investors and managers make financial decisions and how these decisions are reflected in financial markets. His work has been published in The Journal of Finance, The Financial Analysts Journal, The Journal of Portfolio Management, and many other publications. Meir has also received numerous awards for his research, including three Graham and Dodd Awards and the Matthew R. McArthur Industry Pioneer Award. His latest book, Finance For Normal People, was just released in paperback.

Background

Meir Statman bio

Finance for Normal People by Meir Statman, Oxford University Press, 2017 

What Investors Really Want: Know What Drives Investor Behavior and Make Smarter Financial Decisions by Meir Statman,McGraw-Hill Education, 2010.  


Investor Behavior

The Expressive Nature of Socially Responsible Investors” by Meir Statman, January 2008. 

Money Flowed to the Cheapest Funds in the Third Quarter” by Tom Lauricella and Gabriel Dibenedetto, Morningstar.com, Oct. 2019. 

Morningstar Fund Flows Commentary” by Morningstar, August 2019. 


Retirement Happiness

FIRE movement

Michael Finke: Here’s What Makes Retirees Happy” by Morningstar, The Long View podcast, episode 23, October 2019. 

To Compete with Robos, Advisors Must Become Financial Physicians” by Lauren Foster, CFA Institute blog, April 2017. 


Retirement Spending

Carolyn McClanahan: There’s More to Money Than Just the Numbers” by Morningstar, The Long View podcast, episode 5, June 2019. 

The Mental Mistakes We Make with Retirement Spending” by Meir Statman, Wall Street Journal, April 2017. 

The Bucket Approach to Retirement Allocation” by Christine Benz, Morningstar.com, February 2019.

Oct 30 2019

55mins

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Rank #17: James Montier: 'How Do I Get Paid for Owning This Asset?'

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Our guest on this week's installment of "The Long View" podcast is James Montier. Montier is a member of the asset-allocation team at Grantham, Mayo, Van Otterloo & Co. Before joining GMO in 2009, he was co-head of global strategy at Societe Generale. A prolific and incisive writer, Montier has authored several books, including Behavioural Investing: A Practitioner's Guide to Applying Behavioural Finance; Value Investing: Tools and Techniques for Intelligent Investment; and The Little Book of Behavioral Investing. He's also a regular contributor to GMO's library of white papers and research studies on topics ranging from productivity, strategic asset allocation, contrarianism, and more. In addition to his duties at GMO, Montier is also a visiting fellow at the University of Durham and a fellow of the Royal Society of Arts.

Background 
Grantham, Mayo, Van Otterloo & Co.

Behavioural Investing: A Practitioner's Guide to Applying Behavioural Finance by James Montier 

Value Investing: Tools and Techniques for Intelligent Investment by James Montier 

The Little Book of Behavioral Investing: How Not to Be Your Own Worst Enemy by James Montier 

GMO's research library

Montier's articles in GMO's research library

Montier's Role at GMO
"My role is essentially to be difficult, and it turns out I'm quite good at that." Montier describes his role at GMO and how his contributions to the firm are measured. (1:10-3:11)

Fostering Debate at GMO
"We have never had a house view." Why debate and constructive devil's advocacy is welcome at GMO. (3:12-4:31)

"Investing is one of those fields where there is almost constant evidence that we are all wrong." How to foster humility and a diversity of views. (4:32-7:38)

Debating Jeremy Grantham on mean reversion: Montier gives an example of an issue the team has debated recently--how long it takes for markets to revert to their long-term averages. (7:39-9:36)

Forecasting and Portfolio Construction
How the debate over mean reversion informs GMO's asset-class forecasts. (9:37-10:09)

Corporate concentration and low interest rates: How GMO is reconsidering these variables and their impact on the asset-class forecasts it makes. (10:10-11:38)

"The Idolatry of Interest Rates, Part II: Financial Heresy and Potential Utility in an ERP Framework" by James Montier and Ben Inker (Aug. 11, 2015)

How GMO incorporates its asset-class forecasts into the multi-asset strategies it manages. (11:39-12:37)

  • GMO Benchmark-Free Allocation III GBMFX  

The appeal of a "robust" forecast that's meant to help portfolios withstand various potential outcomes. (12:38-14:15)

"Our portfolios look a little freakish." Montier explains why GMO is U.S.-stock-phobic and, conversely, why the firm is finding value in alternatives. (14:16-18:04)

Career risk: Where individual investors hold an edge over institutions. (18:05-18:55)

Alternatives
Montier defines "alternatives." Different ways of owning standard risks--depression risk, inflation risk, and liquidity. (18:56-21:49)

Montier presents two examples of alternative strategies that GMO employs--merger arbitrage and put-selling--to own standard risks in different ways. (21:50-25:49) 

"We should size them such that they cannot hurt the overall fund should we get something wrong." How GMO sizes its positions in alternative strategies. (25:50-27:33) 

Alpha, beta, and decay: How GMO assesses an alternative strategy's vulnerability to being arbitraged away. (27:34-29:57)

GMO's Bearish U.S. Equity Forecast
"How do I get paid for owning this asset?" Key inputs to GMO's U.S. equity forecast--multiple, margin, yield, and growth. (29:58-32:08)

"A behavioral self-defense mechanism." How GMO's approach to forecasting helps to structure its thinking and anchors decision-making. (32:09-34:54)

"It's really valuation where we've been most wrong." Where GMO's U.S. equity forecast erred in recent years. (34:55-36:01)

"We have to wear that. We have to own it." Montier on steps that GMO has taken to introspect on its forecasting error and how that expresses itself in the way it makes decisions and manages money. (36:02-39:45)

Planning Amid a Dearth of Value
"A reach for yield in any way, shape, or form." Explaining the dearth of value. (39:46-41:43)

"We have always been pretty bad at (forecasting), and it's unlikely we're going to get a lot better." (41:44-44:37)

How should investors and advisors forecast asset-class returns and plan for the future? (44:38-47:25)

Capital Allocation
Montier on the folly of firms borrowing to repurchase shares: "The more stable the environment, the easier it is to take on leverage, but the greater the danger that taking leverage creates further down the line when you get some random shock." (47:26-50:49)

Jul 10 2019

53mins

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Rank #18: Chris Mamula: What Young Retirees Need to Know

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Our guest on the podcast today is Chris Mamula. Chris blogs on the website, "Can I Retire Yet?" and he has also cowritten a book called Choose FI: Your Blueprint to Financial Independence, which was published in 2019. Chris is loosely part of the FIRE, or Financial Independence Retire Early, movement, but he brings a fresh perspective to the concept. He retired from a career as a physical therapist at age 41. After poor experiences with the financial industry early in his professional life, he educated himself on investing and tax planning. Now he draws on his experience to write about wealth building, do-it-yourself investing, financial planning, early retirement, and lifestyle design.

Background

Can I Retire Yet?

Choose FI: Your Blueprint to Financial Independence, by Chris Mamula, Brad Barrett, and Jonathan Mendonsa. 

FIRE Movement

FIRE Movement

"Your Questions about FIRE, Answered," by Steven Kurutz, The New York Times, Sept. 11, 2018. 

Lifestyle and Personal Considerations

"Nearly 2 Years into Early Retirement, Here’s All That I’ve Gotten Wrong," by Chris Mamula, marketwatch.com, Aug. 19, 2019.  

A Strong Marriage in Retirement,” by Darrow Kirkpatrick, Can I Retire Yet?, March 19, 2017. 

"Does Fire Make Life Harder?," by Chris Mamula, Can I Retire Yet?, Dec. 10, 2018. 

A Week in the Life of a Fire Household,” by Chris Mamula, Can I Retire Yet?, Sept. 17, 2018. 

Healthcare Coverage for Early Retirees

Navigating ACA Tax Credits to Purchase Affordable Health Insurance,” by Chris Mamula, Can I Retire Yet?, Nov. 12, 2018.


How to Qualify for Affordable Care Act (‘Obamacare’) Premium Subsidies,” by Mike Piper, Oblivious Investor.


Are Health Care Sharing Ministries a Viable Alternative to Health Insurance for Early Retirement?” by Chris Mamula, Can I Retire Yet?, Nov. 19, 2018.


Health care sharing ministry, Wikipedia. 

Do You Plan to Retire by 50? Great, But Can You Cover Your Health Care?” by Janna Herron, USA Today, June 4, 2019. 

Investing and Withdrawal Rates 

Bogleheads website


Jim Collins blog

"The Safe Withdrawal Rate Series: A Guide for First-Time Readers," Early Retirement Now.


Stock Series, jlcollinsnh.com


The Simple Path to Wealth: Your Road Map to Financial Independence and a Rich, Free Life, by J.L. Collins.

Retirement Saving and the Empty Nest Transition,” by Michael Kitces, kitces.com, May 25, 2016. 

"The Stages of Financial Independence," by Chris Mamula, Can I Retire Yet?, Sept. 23, 2019,

The Problem with FIREing at 4% and the Need for Flexible Spending Rules,” by Michael Kitces, Kitces.com, July 23, 2019. 

The 25X Rule to Early Retirement,” by Rob Berger, Forbes.com, Feb. 23, 2017. 

Human capital definition, Investopedia 

Going Back to Work,” by Chris Mamula, Can I Retire Yet?, July 22, 2019. 

Mr. Money Mustache

Jan 15 2020

41mins

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Rank #19: Moira Somers: How to Give Financial Advice That People Will Actually Take

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Our guest on the podcast today is Dr. Moira Somers,  a clinical neuropsychologist and professor. She’s also author of the book Advice That Sticks: How to Give Financial Advice That People Will Follow, published in 2018. Dr Somers’ expertise is in brain functioning, behavior change, and mental health, topics that she often discusses in the context of financial advice. She’s a frequent public speaker and also consults with advisors on improving their client outcomes. 

Dr. Somers is a senior faculty member with the Sudden Money Institute, where she trains advisors and conducts research into the psychological factors at play during major life transitions. 

Background

Moira Somers' biography

Moira Somers' website

Somers, M. 2018. Advice That Sticks: How to Give Financial Advice That People Will Follow (London: Practical Inspiration Publishing).

Improving Client Adherence

Behavioral finance definition

Martin, L., Williams, S.L., Haskard, K.B., et al. 2005. “The Challenge of Patient Adherence.” Therapeutics and Clinical Risk Management, Vol. 1, No. 3, P. 189. 

Somers, M. “Does Your Advice Stick?Journal of Financial Planning, May 2018.

Stone, G.C. 1979. “Patient Compliance and the Role of the Expert.” Journal of Social Issues, Winter. 

Financial Jargon Your Advisor May Throw at You,” CNBC.com, Oct. 8, 2012. 

Beerens, M. 2019. “Listening, Empathy and Personal Attention Go A Long Way in Client Acquisition and Retention.” Investors Business Daily, Nov. 4, 2019. 

Lee, B.Y. 2018. “11 Seconds: How Long Your Doctor Waits Before Interrupting You." Forbes.com, July 22, 2018. 

Jung, D. 2019. “Nudge Action: Overcoming Decision Inertia in Financial Planning Tools.” BehavioralEconomics.com, March 12, 2019.

Benartzi, S. 2017. “How Digital Tools and Behavioral Economics Will Save Retirement.” Harvard Business Review, Dec. 7, 2017.

Raihani, N. 2013. “Nudge Politics: Efficacy and Ethics.” Frontiers in Psychology, Vol. 4, P. 972. 

Eisenberg, R. 2013. “To Solve the U.S. Retirement Crisis, Look to Australia,” Forbes.com, Aug. 19, 2013. 

Frankenfield, J. 2019. “What Is a Robo-Advisor?Investopedia.com, Oct. 1, 2019. 

Knudge.com

Touchstone Pathway

Gamification definition

Kahneman, D. 2011. Thinking, Fast and Slow.

Dec 18 2019

50mins

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Rank #20: Bill Nygren: 'A Stock That Doesn't Look Cheap on the Surface Might Be One of the Cheapest'

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Our guest on this week's installment of The Long View is noted portfolio manager Bill Nygren. Nygren joined Chicago-based Harris Associates as an analyst in 1983 and later served as the firm's director of research. He has managed Oakmark Select OAKLX since 1996 and Oakmark Fund OAKMX since 2000 and has comanaged Oakmark Global Select OAKWX since 2006. In addition to these duties, Nygren serves as Harris' chief investment officer for U.S. equities. For his investing achievements, Morningstar recognized Nygren as its Domestic-Stock Manager of the Year in 2001, and his funds remain highly rated by Morningstar's manager research analysts. A frequent and insightful commentator on investing and markets, Nygren's shareholder letters are a must-read on the Street and beyond. In this far-ranging conversation, he discusses how his team's competitive edge has evolved, how traditional value metrics won't cut it in today's evolving economy, and the lasting lessons of the financial crisis.

Background Information

Related Links

How Stock-Picking Has Changed and What Defines Value

Portfolio/Risk Management

Portfolio and Holdings

About the Podcast: The Long View is a podcast from Morningstar. Each week, hosts Christine Benz and Jeff Ptak conduct an in-depth discussion with a thought leader from the world of investing or personal finance. The podcast is produced by George Castady and Scott Halver.

About the Hosts: Christine Benz and Jeff Ptak have been analysts and commentators on investments and the investment industry for many years. Christine is Morningstar's director of personal finance and senior columnist for Morningstar.com. Jeff is head of global manager research for Morningstar Research Services, overseeing Morningstar's team of 120 manager research analysts in the U.S. and overseas.

To Share Feedback or a Guest Idea: Write us at TheLongView@morningstar.com

Aug 07 2019

57mins

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