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Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
  • Fido Double Secret Probation
    This thread has gone in many directions.
    Some points I would like to make.
    Banks, TSA (and some others) have secrecy by the law. They aren't supposed to tell you the details. It may seem unfair, but don't blame the Reps.
    Just ask Warren Buffett when he was visited by the FBI a few years ago when he made several cash withdrawals around $10K (not even pocket change for him?) from his local bank - his folksy explanation was that his wife only liked cash (not cards or checks), while the FBI wanted to make sure that he wasn't being blackmailed. Or, the late Senator Ted Kennedy whose name was on TSA no-fly list for some reason while he himself may not have been the target - he even mentioned his airport TSA experiences in frustration in a Senate speech and asked the President to do something about it.
    I have good experiences with chats too, except some robo-chats. In one instance, I thought that robo-chat would transfer to a human-chat, but it didn't. So, I responded, that the issue was beyond a robo-chatter, and he/she/it replied, sorry that I felt that way and wished me a good day.
  • Biden's budget assumption: interest rates might actually be "higher for longer"
    From the Wall Street Journal's analysis of the economic assumptions released with the Biden budget:
    Economic forecasts released Monday as part of the White House’s 2025 budget proposal assume that three-month Treasury bill rates will average 5.1% this year, the same as in 2023, before declining to 4% next year and 3.3% in 2026.
    The White House sees the average 10-year Treasury note yield rising to 4.4% this year from 4.1% last year and then declining gradually to 3.7% by the end of this decade.
    My recollection is that 5% is dead average for the 10 year note over the past century. Good news: I recall hearing it from Kai Ryssdal on a Marketplace podcast. Bad news: can't track it down.
    Those sort of interest rates remind investors that there is an alternative to stocks, which might well occasion a shift from equities and at least the tiniest bit of discipline on the part of managers (fund and otherwise). Jon Sindreu at the Wall Street Journal published an interesting project that suggests that cash might handily beat stocks over the next 12 years and would be pretty competitive with them over the next couple years. His projection of asset class returns, based on "quarters similar to today," puts the two-year APR for stocks at 7.something percent, cash at about 7% and bonds at over 8%. The dominance of stocks would return unless you had a time horizon of five years or more ("How to Invest? More than ever, it depends on who you are?" Wall Street Journal, 3/15/2024)
    I wish the White House (or anybody else) a lot of luck trying to predict where interest rates will be a year or two out.
    I also recall hearing, years ago, that the long-term average for the 10 year Treasury being around 5%, but I know I didn't hear it from your source.
    I have to laugh, or maybe yell, at young people today whining about 6-7% mortgage rates (which are also normalized, if memory serves). I bought my first house in 1975 and paid 8.5% which was the going rate. It went up into double-digits a few years later.
    Maybe the era we're in with "high" (normalized) interest rates will encourage young people to not borrow so much, and instead try to live more within their means. I learned that valuable lesson from my father, who was a struggling young man when the Great Depression hit. Most people today cannot comprehend what those people went through.
    As for cash being competitive with other asset classes, I have about 11% of my retirement portfolio in a 5.2% money market, which makes for a nice stable portion, yet still earning something -- unlike it would have a few years ago when "cash is trash."
  • Fido Double Secret Probation
    @crash, I have had experience with a number of large brokerages. They have their ‘pros’ and ‘cons’ as our needs evolve over time. In recent years we consolidated to a few; some were our former 401(k) administrators and we get assess to unique planning tools. Fidelity meets majority of ours needs. While many posters are Schwab customers, but our needs may be quite different. So I will leave it at that. At least I am glad you move on from T. Rowe Price.
  • Fido Double Secret Probation
    I dont think it is the employee's fault as I suspect they are rushed through training and put to work ASAP
    although I have to say there are some strange things going on at Fidelity.
    My wife and I moved a small (LT 10%) of her account to Schwab to make it easier to gift our kids some stock.
    We got five daily phone calls from a fidelity rep wanting to know why.
    Well that struck a chord. About a dozen years ago, I moved a small (LT 10%) annuity from Fidelity. And I got a call from my rep at Fidelity (back when Fidelity assigned reps), who harangued me for about 15 minutes before putting a specialist on the phone. All in all, about an hour with them telling me why the Fidelity product was so much better than where I was moving to, how they could stop the transfer before it was complete if I okay'd that.
    Something else about this call. As a rule I don't use a cell phone. (I have one, pay $10/year to keep the line active, but rarely turn it on; the flip phone makes a great pocket watch.) I don't give out my number because people just leave messages that I don't hear for months.
    Somehow Fidelity got that number, and rather than call me on my preferred home number, they called the cell phone. I was on a business trip to California (which is why my phone was on). So I wound up on a one hour call with Fidelity at 6:30 AM, being remarkably coherent in explaining why their particular offering didn't best meet my needs.
    Reps get paid in part by AUM of their customers; this is scaled by how lucrative each dollar is - more for an annuity. They also get paid for retaining assets. So my transfer out must have hit the rep's pocketbook hard.
  • Fido Double Secret Probation
    Interesting that the OP has some idea and the a/c is frozen until the internal investigation is complete. It could be a trade violation or something else.
    Banks are worse. There are many reports on social-media that banks (including big banks) are suddenly closing personal and business accounts for what they think are suspicious activities but they don't provide any explanations or advance warning. Some customers had those a/c for years. But one day, their accounts are locked or closed with balance sent by check within a few days. When people go to branches, the personal bankers try to look up the a/c in question, but then say that sorry, they cannot disclose anything. If one relies on one bank a/c, this may become a huge problem.
  • Tim Buckley led meteoric growth at Vanguard, knew when to say 'no'
    at Firstrade ... To check on other funds the only precise way is to open an account and put in a test trade which will tell you if it the fund is available and the minimums which for the majority is way under 10k.
    I still have a login there many years after closing an account. I have assumed that the fund information I see after logging in (min, open/closed, etc.) is accurate. (I cannot trade in a closed account.)
    Have you run across a fund where the test trade showed something different than the info provided on the trade page? Or are you just being extra careful by doing test trades?
  • Biden's budget assumption: interest rates might actually be "higher for longer"
    My recollection is that 5% is dead average for the 10 year note over the past century. Good news: I recall hearing it from Kai Ryssdal on a Marketplace podcast. Bad news: can't track it down
    TheMarketplace piece was actually written by Sabri Ben-Achour, though read by Kai Ryssdal. At the 2:15 mark (or in the text) you'll find:
    “You know, actually, historically speaking they’re not that high,” said David Krause, emeritus professor of finance at Marquette University. He pointed out that on average over 100 years, long-term Treasury yields were 5.2%. Close to where they are now.
    https://www.marketplace.org/2023/10/23/why-are-bond-yields-so-high-right-now/
    I'm still trying to harmonize the second piece mentioned in the OP (by Jon Sindreu) suggesting cash yielding 7%/year over the next two years with the first piece quoting White House economic forecasts for cash (3 mo. Treasuries) averaging 5.1% this year and 4% next year. Even if that forecast is a bit rosy (costing the Treasury less in interest), I don't see how one gets to 7%, not just in the near future (next few months) but sustained over a period of two years.
    Reading the 3/14/2024 online version of the WSJ piece I don't find mention of a two year timeframe. It does say that looking at quarters similar to today, " On a one-year performance basis, stocks weren't just riskier, they also returned less on average than bonds and cash." Print version must have more, or is at least different.
  • Biden's budget assumption: interest rates might actually be "higher for longer"
    From the Wall Street Journal's analysis of the economic assumptions released with the Biden budget:
    Economic forecasts released Monday as part of the White House’s 2025 budget proposal assume that three-month Treasury bill rates will average 5.1% this year, the same as in 2023, before declining to 4% next year and 3.3% in 2026.
    The White House sees the average 10-year Treasury note yield rising to 4.4% this year from 4.1% last year and then declining gradually to 3.7% by the end of this decade.
    My recollection is that 5% is dead average for the 10 year note over the past century. Good news: I recall hearing it from Kai Ryssdal on a Marketplace podcast. Bad news: can't track it down.
    Those sort of interest rates remind investors that there is an alternative to stocks, which might well occasion a shift from equities and at least the tiniest bit of discipline on the part of managers (fund and otherwise). Jon Sindreu at the Wall Street Journal published an interesting project that suggests that cash might handily beat stocks over the next 12 years and would be pretty competitive with them over the next couple years. His projection of asset class returns, based on "quarters similar to today," puts the two-year APR for stocks at 7.something percent, cash at about 7% and bonds at over 8%. The dominance of stocks would return unless you had a time horizon of five years or more ("How to Invest? More than ever, it depends on who you are?" Wall Street Journal, 3/15/2024)
  • Schwab move...Let's retire this thread. Lots of interactions. Food for thought. THNX.
    Crash, FWIW: After 27 years at Schwab, I have never had any kind of problem like this where it wasn't resolved quickly. Maybe try to go over this guy's head . . . ?
  • "Some ride Bitcoin's roller coaster to top"
    My favorite bitcoin story is the son of a patient of mine who Dad said maybe 10 years ago his kid had some huge amount of Bitcoin on a thumb drive in his safe deposit account. Even then it was worth several million dollars. He said they were never going to sell it as it was going to infinity.
    Since I retired I lost touch witht he Dad but I always wonder if his son held on to it.
  • Fidelity® Latin America Fund will be reorganized
    I agree. But FLATX has lived up to it's name !!!
    "flat" for the last ten years. COBYX has 50% Latin America and is doing much better
  • Tim Buckley led meteoric growth at Vanguard, knew when to say 'no'
    So far, people who started as Bogle's personal assistants have eventually landed at the top.
    At 55 and only 6 years at the top, did Tim Buckley quit or was pushed out? He may have perfected the race to the bottom ER at the expense of everything else and possibly damaging the Vanguard brand. If Vanguard wants to move forward in advisory business again (it ditched its old advisory business for the robo-advisors/PAS), it had to change the horse. We may have to wait for juicy details of the drama.
    MY IRAs remain at Vanguard, but other accounts are elsewhere.
  • Tim Buckley led meteoric growth at Vanguard, knew when to say 'no'
    There have been many complaints regarding Vanguard customer service and technical glitches over the years.
    Tim Buckley was Vanguard's Chief Information Officer from 2001 to 2006.
    Mr. Buckley should therefore be well-versed in technology.
    In 2019, he stated the company was spending more than a billion dollars on technology.
    Was this technology funding well spent?
  • Buy Sell Why: ad infinitum.
    @BaluBalu, I am now at around 70% equity in the IRA after living at 75% for years. The main change has been switching cash to bonds. I haven't noticed any major change since last October. I suppose some part of it must have to do with increased returns on cash and floating rate funds since last summer,
    I added JAAA to my bond watch list. But I doubt I'll get into anything to do with CLO's.
  • The Great Paradox of the U.S. Market! - By Jeremy Grantham
    Sure, anything can happen but I have been reading that this time, really, is the right time..for years already.
    I also read in 2008, 2020, 2022, that the Fed hands are tight and...here we are.
    I always believed in investing in the market you have, not the one you may or anticipate you have.
    And for some, like me, volatility matters.
  • Emerging Markets Anyone?
    BTW, you can also create a ladder of US Treasuries extending out 10-20 years that now yields well over 4%. Treasuries are call-protected, and you can easily sell them if you need cash sooner than maturity dates. Treasury income is exempt from state and local taxes, further boosting yields if held in taxable accounts. They also are available as floating rate notes and TIPS.
    None of the many bond funds (including intermediate and multisector) that I track have returns exceeding 4% over the past 5 and 10 years, and very few over 15 years.
    Furthermore, 4% is often cited as a sustainable annual withdrawal rate for a retirement portfolio. So, you can now achieve that rate with Treasuries for at least the bond portion of a portfolio, presumably using stocks to account for inflation.
  • Emerging Markets Anyone?
    @MikeM - You seem to be missing the point about CDs. I don’t recall anyone advocating investing all of your money in CDs, or even a substantial portion. The great thing about CDs right now are the relatively high yields with predictable, stable returns. I have highly rated bond funds that have lost money over the past 3 years, with pitiful returns over the past 5, 10 years.
    Now that I am approaching the age for required minimum distributions, it’s nice to know that I can put a portion of my portfolio in an investment with a guaranteed return. Using a ladder, I can create a guaranteed income stream up to 5 years or longer. My CD ladders are yielding 5% plus. Who knows what bond funds will return over the next 1, 3, 5 years? Nobody. BTW, I still own bond funds, and their returns still suck despite the dead-cat bounce in late 2023.
    Great post that IMO should be required reading for all of the CD detractors on this forum.
    We have maintained a CD ladder for ~15 years. But when CD rates crossed over our % hurdle in 2022, we SOLD all of our remaining dedicated bond funds that weren't SOLD when the great bond crash occurred.
    We did NOT reduce our stock exposure, we only reduced our bond exposure which currently (and happily!) sits at its lowest point since retiring in 2012. (Our only bond exposure is via PRWCX and FBALX. Period.) We effectively replaced our bond sleeve with a larger CD ladder sleeve and are enjoying every minute of it.
    It's really all about a couple of pretty simple questions:
    What does an investor (NOT a trader) expect as LT, annual TRs on bond OEFs?
    If your answer to that question is ~4%-5% or lower, then why in the freaking world would you NOT instead have invested those monies in a fixed rate, Call Protected, FDIC'd CD that GUARANTEES that same or better rate? (Aside: If it's higher than that, please pass me what you're smokin'!)
    FWIW, ridding ourselves of the nuisances of owning bond funds and managing a bond portfolio allowed us SO much more time to concentrate on our stock portfolio and take on MORE RISK given the elimination of bond fund related risk. And since that transition our stock portfolio performance has significantly improved.
  • Emerging Markets Anyone?
    @MikeM - You seem to be missing the point about CDs. I don’t recall anyone advocating investing all of your money in CDs, or even a substantial portion. The great thing about CDs right now are the relatively high yields with predictable, stable returns. I have highly rated bond funds that have lost money over the past 3 years, with pitiful returns over the past 5, 10 years.
    Now that I am approaching the age for required minimum distributions, it’s nice to know that I can put a portion of my portfolio in an investment with a guaranteed return. Using a ladder, I can create a guaranteed income stream up to 5 years or longer. My CD ladders are yielding 5% plus. Who knows what bond funds will return over the next 1, 3, 5 years? Nobody. BTW, I still own bond funds, and their returns still suck despite the dead-cat bounce in late 2023.
  • Buy Sell Why: ad infinitum.
    @MikeM. The equity portion is covered with swaps. From the prospectus:
    The Fund expects to use only a small percentage of its assets to attain the desired exposure to the Index because of the structure of the derivatives the Fund expects to use.
    The bond portfolio is collateral for the swaps. That's the way I remember it being described when I first bought it several years ago. These days they say that the bonds "seek to provide additional long-term total return." But yeah, it's also there for redemptions IMHO.
    Duration on the fund is currently 1.32 according to Doubleline. Doubleline does not cooperate with M*. So I would take their coverage with a tsp of salt.
  • IRS Interest payment
    Nothing on Turbotax
    MASS dept revenue services doesn't list it. There is a table that is ten years old