Letters to the Editor

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To the Editors:

In the article “Optimizing Your Retirement Income: What Works Best and Why,” by Christine Fahlund, Monte Carlo analysis was used as the basis for the recommendations [August 2008 AAII Journal]. However, Monte Carlo for stock analysis does not predict the future. It only says what the statistics were for the past. Even then, it does that wrong when it assumes inflation was constant over the whole period and there is no serial correlation. It makes no sense to have a scenario where one moment the input may be from 1933 and the next input may be from 1999. It would be better to admit that the statistics only reflect past history and use actual scenarios with the correct inflation and r

H. K. Hebeler

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