Everyone has heard (or more likely seen online) a story about some 20-something not getting a job or being fired from a job due to things they found out about their past on google/facebook/twitter.  There are two ways to handle this possibility, one is to play not to lose and try your best to keep the internet clear of any mention of you.  The second is to go on offense and make sure that when someone does search for you, they find your online presence.

What the media never covers is how many people have gotten jobs because of their internet presence.  How valuable is it when a potential employer googles a developer candidate and sees a link to their blog chock full of valuable programming techniques?  Or their numerous contribution to open source projects?

Put yourself in the employers shoes, you receive two java developer resumes of equal quality and immediately look for them on google/facebook/twitter.  Candidate one has almost no presence at all.   Candidate two has numerous hits related to previous java programming work and blog posts containing thoughts on trying to develop an iPhone App.  A further search on facebook also shows him doing keg stands with numerous young co-eds at a frat party two summers ago.

Which would you hire?

“If aliens ever visit us, I think the outcome would be much as when Christopher Columbus first landed in America, which didn’t turn out very well for the Native Americans.”

no cost is too high, they say, to prevent the next 9/11. But if history is any guide, the next attack will probably not be like 9/11—it will be like NWA 253, something which threatens the lives of dozens or hundreds of people, not thousands. To the extent we overreact to these incidents—allowing them to disrupt our economy and our way of life—we do little but increase the value to terrorists of committing them.

Full article here, Nate’s website here.

I found the approach to be well thought out and refreshing.  Faber makes a very strong case for the significant inclusion of foreign equities (already common on most allocation models but in smaller percentages) as well as REITs (less common) and commodities (rare).  The most illustrative chart on including all 5 of the suggested asset classes (US equities, foreign equities, bonds, commodities and reits) is on page 137 which along with the accompanying table shows how surprisingly close the total returns for each of those classes have been over the previous 25 years.

The second premise and the one that has gotten more attention on the web via Faber’s blog is the timing portion where an investor moves to cash when the price of the asset class crosses below its 10 month moving average and buys back in when it crosses above.  Based on the data provided in the book and updated on the accompanying website, this method provides a safeguard against scenarios like 2008 where the correlation of the major asset classes went to 1 as the entire global financial markets melted down.  This meltdown resulted in losses to the Harvard and Yale endowments of 25-40% while Faber’s timing model had a positive return of ~1%.  Impressive performance for model that was public as of 2007 and can be duplicated for a fraction of the cost of the average mutual fund.

This book should be read by anyone who still believes the common axiom that the key to asset allocation is adjusting the % of stocks versus bonds based on your age.