The Bloomberg on the Economy podcast interview with Zvi Bodie is definitely worth a listen. Boston University professor Bodie is, with Alex Kane and Alan J. Marcus, author of Investments, now in its 8th edition — the book I used years ago to learn much of of what I know about MPT.
Prof. Bodie’s website has a lot of resources, including this page of webcasts and podcasts. See also this Boston University link-rich summary page: Zvi Bodie, in print, video, and Webcast addresses the market turbulence’s impact on retirement investing.
…A panel discussion Friday found plenty of disagreement among four investment experts.
“Most investment advisers today are telling people to sit tight, that that’s the best way to deal with this financial storm,” said Zvi Bodie, professor of management at Boston University, and a participant on the panel.
“I say no. The best way to deal with the uncertainty of this storm is to get out of harm’s way, to seek safety and then wait until the storm clears and reconsider what you want to do. Unfortunately, within the universe of 401(k) plans, there’s not a whole lot of high ground,” Bodie said….Few investors understand the true risk inherent in equities, Bodie said, and that means retirement savers should choose an essentially risk-free option such as Treasury Inflation Protected Securities.
“If you want full protection against inflation and a guarantee that you’re going to beat inflation, right now long-term TIPS are paying 2.8% per year over the rate of inflation. That is the true inflation hedge,” he said.
Also useful is this short interview with Bodie and index-fund innovator Jack Bogle.
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