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I see why 20% is at the high end of the recommendation. It sounds conservative but I have to think about what it turns into when the market drops.

Yah, that's the thing about margin that so many beginning (and short-time) investors don't see. Until you've lived through a couple of market cycles---boom, crash, boom, crash---you don't have a good feel for what can happen when the SHTF. Not to mention the breathtaking speed at which crashes happen.

I'm looking at one of our accounts that had these values for "growth of $1000 invested", at year-end from 2006 to 2010:
1180 (wow! 18% gain in one year--load up the boat!)
684 (Oops, 42% loss in one year.)

My bond allocation will start mechanically increasing this summer after QE2 ends.

[DrTarr:]Does it matter what rates are doing - have done etc.?

This is a variation of the sunk cost fallacy. Very common error and damned hard to avoid making this error, even when you are aware of it.
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