The Forever Portfolio

INSERT DESCRIPTIONThe Forever Portfolio, spotted this week in the Nashville airport.

Our friend James Altucher has a new book out, The Forever Portfolio, which is an investment book — the subtitle is “How to Pick Stocks That You Can Hold for the Long Run” — but it is also full of James Altucher stories about poker-playing and idea-generating and other stuff, most of which is generally great. Here’s one review.

It may seem like bad timing to come out with a stock-picking book in the midst of a gruesome bear market. Or maybe it is great timing.

The book is full of sub-rosa and counterintuitive investment ideas. I liked the book a lot; in fact, I wrote the foreword. Here’s an excerpt:

James is especially good at making silk purses from sows’ ears. He finds the upside in identity theft, obesity, bot armies, and traffic fatalities. Some may grumble that he is ghoulish, preying on American vices and weakness in order to profit. That is a moral argument best addressed in a different kind of book than this one. What I will say about James personally is that he is a good and kind man, humane, a mensch even. … There is almost nothing in this book that isn’t thought-provoking. I hope you read it with the same pleasure that I did.

I got an e-mail the other day from James that nicely illustrates his thinking:

Last week Google had an interesting news item: you could track the spread of the flu using “Google Flus,” i.e. searching “flu” at Google Trends and seeing which states pop up first. But this was only a distraction from the economic news of the moment.

Perhaps a more insidious harbinger of things to come is the Google search data for suicide methods. Note the spike upwards in the last two months. While every day we see the financial toll the markets are taking on the world, the human toll has yet to be recorded, although the sadness and desperation resulting from dwindling retirement accounts will have their effect over the months to come.

I hope this spike results in an increase in therapy bills and then antidepressant revenues (benefiting Pfizer, Eli Lilly, and other big pharma companies), but my worry is that we’ll be reading deeply sad stories in the months to come.

People should realize that, like other catastrophes and major life events (from 9/11 to personal ones like divorce or loss of a loved one), this, too, shall pass. Stimulus will kick in, markets will recover, and the time we spent worrying will have been proved for naught.


I find it odd that all the "investment professionals" who have counseled us 401K investors for years to buy and hold now seem to be dumping massive amounts of stock in a down market. WTF?

This looks like it could be a fun book to check out to change my mind about investment professionals.


"I hope this spike results in an increase in therapy bills and then antidepressant revenues (benefiting Pfizer, Eli Lilly, and other big pharma companies)"

How exactly are people going to pay for this stuff when they don't have the money due to the layoffs/401K loss?

Why not just wish that people could get better without lining the pockets of Big Pharma? That part of the e-mail can be seen as being rather arrogant or repugnant.


Pharmany companies = big, therefore anything that brings them money = bad. Altruism logic!

Talk about hatred for the profit motive being the true route of evil, not money.

"I'd allow you to get better but it requires to pay for something, and that means giving big business money! Sorry, socialism is more important than sadness."


@ derick #3: i think you are a bit confused. what socialism would actually do is try to force the drug companies to give you the meds for free. caliphilosopher #2 was spot on with his remarks


Is it as good as that book about how "My Sharona" became a hit?


there probably will be slightly less suicides, now that they made antifreeze taste so sour



Your Altucher worship is obviously due to your friendship. Yeah he seems like an affable guy and someone I'd like to have a beer with or maybe play a game of chess with.

The truth is he is an absolutely terrible stock picker, go look at and check out any of his articles and picks. Yeah, he can come up with cute ideas, too bad they never make money. He is a perma bull, which is retarded during the Crash of 2008.

And he is so brainwashed as a perma bull, that he may read this and think of it as a "contrarian indicator". That being said, I will read this book for entertainment. Before anyone invests based on Mr. Altucher's website, please check out his articles on

I would like to add that making public stock picks is real hard and ballsy to do, but I think if you do that, people should know your track record.

Ed Haines

The best reason I can think of to listen to investment professionals is to learn which way the lemmings are running so that I can go the other way. It is not being contrarian, it is simply realizing that lemmings invariably run off of a cliff. If you don't think this to be the case, go back and read investment advice columns from one to six months prior to each of the big events of stock exchanges over the past ten decades.


I was just pondering a question about risk and volatility in portfolios.

Most investment professionals typically take about one percent of the money you invest with them each year. In return, they spend ten minutes using a simple computer program to create a globally diversified portfolio of mutual funds (which add a whole other layer of fees). This portfolio of mutual funds has a certain risk, reward, and volatility profile that is tuned to your investment time line and risk tolerance.

Now I suspect that all of these portfolios are broken because they have now become subject to a wildly different environment of volatility. Would it be correct to assume that the level of risk these portfolios were tuned to is not not even close to valid anymore and perhaps they should all be reallocated to more stable investments until the market calms down?