Bonds beat stocks?

I used to read Andrew Tobias’s blog for investment advice, but in recent years I’ve read it for political commentary and general entertainment. In the meantime, though, Tobias’s friend, “the estimable Less Antman,” has been taking up the slack.

In the latest issue of his online newsletter, Antman takes issue with an article in the Journal of Indexes (I must have missed that issue...) which maintains that bonds outperformed stocks over a recent 40-year period.

Though bonds are certainly less volatile than stocks, Antman argues that they have serious shortcomings as a long-term investment. While most investors fret over stock market crashes, they tend to underestimate the much greater threat that a too-conservative portfolio will simply fail to grow enough to meet their needs.

Just as they have done in virtually every 40 year period in American history, stocks beat bonds over the last 40 years, and by a clear margin of nearly 1% per year (9.0% vs 8.1%).  Because of the effect of compounding, this difference is hardly insignificant: each dollar invested in the Lehman Aggregate Bond Index (or equivalent) at the beginning of 1969 would have grown to $23 by the end of 2008, while a dollar invested in the Standard and Poor’s 500 Index of large US stocks would have grown nearly 40% more, to $32.  Strangely, this was the SMALLEST margin of victory for stocks since the 40 years beginning 1822 and ending 1861.  Over the course of American history, an average 40 years saw a stock investor end up with nearly five times as much money as a bond investor.

Reviewed by The Complete Review

While I’ve been recuperating from minor surgery, it was a treat to see Michael Orthofer’s review of my book A Basket of Leaves in The Complete Review:

The clever and simple idea behind Geoff Wisner’s A Basket of Leaves is to give readers a sense of Africa by introducing them to 99 Books that Capture the Spirit of Africa ... He does a very good job, and it is what he writes in A Basket of Leaves — and not the ninety-nine excerpts he offers — that make this a good and useful overview of and introduction to Africa ... he packs an enormous amount of variety and information into such a manageable book.

Orthofer zeroes in on some of the hurdles I faced in writing this book: the difficulty of finding literature in English from countries like Chad and Equatorial Guinea, the challenge of dealing with the embarrassment of riches in countries like Nigeria and South Africa, and my desire to include books that shed light on what is distinctive about a particular country. (I thought Purple Hibiscus by Chimamanda Ngozi Adichie was a fine novel, for instance, but one that didn’t have to take place in Nigeria, and therefore I didn’t include it.)

Another nice notice

Warrior Wisewoman 2 got a detailed review from Nerine Dorman, an author and blogger in South Africa, including this about Jenn’s story:

If there’s one story that stood out the most for me, it’s The Executioner by Jennifer Brissett. After reading this one, the majority of the stories in this anthology paled in signficance. Jennifer tells the tale of a future where ordinary persons have to play the role of executioner, much as Americans have jury duty, from what I understand of the US’s system. We see that the death-dealer is very much a woman, a nurturer, who is forced to take a life. A gritty, shocking tale, it caused a pause for thought.

Dorman seems like an interesting individual. Here’s her bio:

Nerine Dorman was born in Cape Town, during the previous century, and has been writing weird tales involving gothboys, vampires, werewolves and other strange beasties since she can remember. She’s been a Spur waitress, is an experienced penguin wrangler, plays piano accordion badly, edits genre fiction, loves travelling and lives with her photographer husband in a log cabin on stilts near Cape Point, where she regularly has to fend off baboons armed only with a broomstick. Her mother still asks when she’s going to write some “proper” fiction.

Sultana by Alan Huffman

It is hard to imagine that the greatest maritime disaster in U.S. history could have been so nearly forgotten, but so it seems. The explosion and fire on board the steamship Sultana killed more than 1,700 people, more than were lost on the Titanic. Yet because the Sultana disaster coincided with the end of the Civil War and the assassination of Abraham Lincoln, it has been overshadowed.

Alan Huffman (the author of an interesting book on Liberia) traces the stories of a few Union soldiers from Indiana who survived battle, prison camp, and the Sultana disaster. He draws on the work of those who have studied the psychology of survival, and spends most of his time—appropriately—conveying not the dramatic horrors of battle but the misery of the sick, wounded, and malnourished.

The Sultana was crammed with 2,400 people when it set off up the Mississippi from Memphis—more than six times the number it was designed to carry. Many of them were Union soldiers recently released from Andersonville and other notorious POW camps. (The north had its own notorious camps, including one in Elmira, New York.)

Huffman describes the view of a local woman overlooking the prison camp at Cahaba, Alabama:

Below her, on the flatlands along the Alabama River, three thousand thin, dirty men milled about inside the crowded stockade of Cahaba prison under a perpetual pall of smoke. Many of the men were sick. Some of them died as easily as fog rose from the river on a cool morning, and their friends had to touch their bodies to make sure they were gone. Others died hard, thrashing on the ground.

The Alchemy of Stone

After years of avoiding the genre, I’ve been lured back toward science fiction, fantasy, speculative fiction, slipstream, or whatever you like to call it (and however you like to parse it) by authors like Jeffrey Ford, Ted Chiang, and Ekaterina Sedia.

The Alchemy of Stone by Sedia is usually classed as a steampunk novel, meaning that it combines elements of 19th century gadgetry into a world that is otherwise futuristic or fantastic. The world created by the Russian-born author is a kind of alternative czarist regime, in which bomb-throwing anarchists threaten a powerful duke. But this duke travels in a carriage drawn by enormous six-legged lizards. The offhand references to the lizards helps the reader glide over his or her disbelief, as does the author’s close attention to the details, including the smells, of her imagined world.

The book concerns the struggle of the the dukedom’s two major power groups: the alchemists and the mechanics. The heroine, Mattie, has a stake in both groups. She is an automaton, created by a mechanic out of metal rods, whalebone, and human hair. But she is also an alchemist, skilled in brewing potions and creating homunculi out of human hair and blood scavenged from slaughterhouses. Mattie has all the emotions of a “real” person, and the sometimes tedious question of is-she-or-isn’t-she is left alone.

The book’s dialogue is sometimes a bit flat, and I’m not sure the plot hangs together, but Sedia’s gift for description makes it well worth reading. 

She glided past him, the whirring of her gears muffled by the room—it was so full of draperies and old rugs rolled up in the corners, so cluttered with bits of machinery and empty dishes. Mattie reached up and swung open the shutters, admitting a wave of air sweet with lilac blooms and rich river mud and roasted nuts from the market square down the street.... She extended her hand, the slender copper springs of her fingers grasping a phial of blue glass. “One of your admirers sent for me—she said you were ailing. I made you a potion.”