Gongol.com Archives: February 2012
Brian Gongol

February 10, 2012

News Should semi-trailer loads be 21% heavier than they are now?
Congress is debating whether to raise the limits on Interstate highway loads from 80,000 lbs. to 97,000 lbs. That would represent a lot more weight -- and thus a lot more momentum behind every truck. It could make shipping more efficient, but would it also make driving more dangerous for others on the road?

Business and Finance It's well past time to retire the "star" mutual fund manager
Fidelity, long known for "star" investment managers like Peter Lynch, is starting to have its mutual fund managers team-up, rather than go it alone. Here's the thing: Actively-managed mutual funds are, with a very small number of exceptions, a losing proposition for investors. Most people would be better off putting most of their retirement investments into broad-based index funds, like the Schwab Total Stock Market Index fund, which has tiny fees and is invested in almost all of the widely-available publicly-traded stocks in America. The idea? Pretty boring. The results, though, are going to reflect the overall performance of the American private-sector economy, which over the long term is going to be pretty good. Most people go after actively-managed mutual funds because they're hoping to get something better than average. So, for that reason, the best advice for most people is to put the lion's share of stock-type investments into a very-low-fee index fund (like the Schwab fund) -- something like 75% to 90% -- and then invest the balance in a smaller number of individual stocks than you could count on both hands. That keeps a touch of excitement in the game, but ensures that, for the most part, you'll get the same performance you could expect from the market as a whole. Low fees are a key, though: The Schwab fund currently charges less than 0.1% a year. Most actively-managed funds take 1% to 2%, and some take even more. Using the low-fee fund means handing over 90% less to Wall Street, and that's not an insignificant amount of savings.

Iowa Iowa gas taxes could rise
We have to pay for our road infrastructure somehow, and the number of deficiencies seems to suggest we haven't been paying enough. But there are better alternatives to the gas tax.

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