October 2015 update ($306,838 +$19987 or +7%)

↑ Accumulated $4,000 USD as part of my annual saving goal for September

↑ Vanguard Emerging markets is up by $1,545 USD.

↑ Vanguard S&P 500 is up by $4,435 USD

↑ Gazprom shares are up by $13,160 USD

↑ Company shares are up by $1,912 USD

↑ Rosneft shares are up by $1,176 USD

↑ iShares Core DAX are up by 1,209

↑ GBP is up to USD slightly $604 USD

Grand total additions: US$  28,041 USD

↓ Precious metals are down by $614 USD

↓ EUR is continue to fall to USD $7,440

 Grand total losses:  US$  7,219

September 2015 update ($286,850 -$11,560 or -4%)

↑ Accumulated $4,000 USD as part of my annual saving goal for September

↑ Vanguard Emerging markets quarterly dividends $194 USD or 6% at the current price.

↑ Vanguard S&P 500 quarterly dividends $196 USD or 1.9% at the current price.

↑ Vanguard Emerging markets shares are up by $3,025 USD

Grand total additions: US$  7,415 USD

↓ Vanguard S&P 500 slid down another $740 USD

↓ Company shares down collectively $1,340 USD

↓ iShares Core DAX down $270 USD

↓ Gazprom shares down $13,160

↓ GBP down to USD $3,465 USD

  Grand total losses:  US$  18,975

August 2015 update ($298,404 +$ 8095 or +3%)

↑ Accumulated $4,000 USD as part of my annual saving goal for July

↑ Gazprom shares are up 1,320 USD

↑ Gazprom annual dividends   4,542 USD  (USD 0.225 per share).

↑ Rosneft annual  dividends  258 USD  ( USD 0.144 per share)

↑ Precisious metals are up by 733 USD as investors are seeking safe harbor.

↑ GBP is up to USD 2,420 USD

↑ EUR is up to USD 3,284 USD

Grand total additions: US$  16,557 USD

↓ Vanguard Emerging markets are down 5,115 USD

↓ Vanguard S&P 500 collapsed 2,540 USD

↓ Company shares down collectively 807 USD

  Grand total losses:  US$  8,462

The Undercover Economist strikes back by Tim Harford

            I recently finished reading “The Undercover economist strikes back” by an English writer Tim Harford. Tim has an education in economics from Oxford University.  Although not very well known outside England is quite popular in it, mainly as a columnist for Financial Times newspaper.

          Aim of the book was to bring macroeconomics a little bit closer to a non-economist in an entertaining fashion.  The book is written like a dialogue between the writer and reader, based on real life examples.  The way topics are presented it has a lot of similarities with  “Irrational Exuberance” by Robert J. Shiller.

          Modern economy for general public is increasingly focusing on psychology, how people react and behave. As example acceptance of the wages falling in real terms, while growing in nominal ones – “money illusion”.  Tom continues on about Bank of England commenting: “ Public trust in the pound is now maintained by the operation of monetary policy”, apparently with a totally straight face.   This basically means that most of modern currencies worth something as long as people believe in it.

          The worrying fact is being a influential economist in his own country the author is advocating having inflation at about 4%, this would help to maintain nominal growth of salaries about zero.

July 2015 update ($290,313 -$ 25,350 or -8%)

↑ Accumulated $4,000 USD as part of my annual saving goal for July

↑ Vanguard S&P500quaterly dividends 186 USD or 1,7% annual rate

↑ Vanguard Emerging market dividends 99 USD or 2,6% annual rate

 Grand total additions: US$ 4,285 USD

↓ Vanguard Emerging markets ETF lost 1,465 USD

↓ Company shares lost 1,300 USD

↓ Rosneft shares lost 1,750 USD

↓Gazprom shares lost 20,670 USD

↓ Vanguard S&P500 lost 370 USD

↓ Precious metals lost 990 USD

↓ EUR lost to USD 1,940 USD

↓ GBP lost to USD 1,150 USD

  Grand total losses:  US$ 29,635

Asset Diversification

Financial independence currency allocation:

Currency	October 2011	June 2012	February 2013	June 2015	December 2015*
EUR	26.5%	25%	13%	68%	93%
GBP	50%	41%	30%	29%	0%
RUB	21.6%	18%	14%	7%	7%
USD	1.9%	15%	43%	0%	0%

*Aspired

I wish I could have more direct exposure to USD, however Western European banks do not allow direct exposure to the USD. A lot of the EU brokerage firms excluding products trading on the US exchange rates  as these are non-AFM (Authority for the Financial Markets) registered investment funds. AFM. This is responsible for supervising business conduct, which focuses on providing:

- Orderly and transparent financial market processes;

- Transparency between market participants;

- Due care in the treatment of customers.

So they excluded Vanguard S&P 500 and Emerging markets sold in US on the USA exchanges. I think they are doing it to reduce US tax entanglements with these.

Many EU brokerage funds removed products listed on the stock exchanges in Israel, South Africa, New Zealand and Russia.

June 2015 update ($315,600 -$ 5,730 or -2%)

↑ Accumulated $4,000 USD as part of my annual saving goal for June

↑ EUR gained against USD $5,620

↑ GBP gained against USD $1,000

 Grand total additions: US$ 10,620

 ↓ Vanguard Emerging market lost 970 USD

↓ Vanguard S&P 500 lost 1,240 USD

↓ Company shares lost 390 USD

↓ Rosneft shares lost 790

↓Gazprom shares lost 12,960 USD

  Grand total losses:  US$ 16,350