Quote from David Rosenberg's newsletter "Breakfast with Dave":
Wealth-Track_Breakfast_with_Dave_2020_06_24.pdf

1.High yield rates “should be” trading closer to 11.0% than 6.4% to compensate for default risk. And that’s for today’s default rate — we haven’t even hit the peak yet. A no-brainer assessment of how mispriced this asset class is at the moment. In fact, when you look at the 50-year history of the data, you will see that the norm is for the average coupon in the high yield market to be about 500 basis points above the prevailing default rate at any given moment of time. Today, the two levels are dead-even — and another case to be made that appropriate compensation for the inherent default risk is much closer to 11% than it is to 6%.
2.The high yield market seems to be pricing in a default rate of 3.25%, which is half today’s level. Instead of discounting a recessionary default rate, the market is pricing in a default rate we typically see three years into the economic recovery.
and,
To be sure, the stock market is way too overpriced for my liking. But the future earnings outlook is a source of debate, and the bulls have stated their case.And I get it. But high yield bonds —come on, it’s as plain as day. It’s about default risk and getting the compensation you deserve as an investor. But you see — it is the debtor, the borrower, that the Fed is most concerned about... creating this massive gap between the current artificial price and true intrinsic value will not, in the end, serve anyone very well.

@Junkster - Are you drinking from this punch bowl?

VTI/SPY performance was higher than BND in the last 10-20-30 years. Nothing new. What is going to be in the next 10-20 years? probably the same.
That was easy.
If you don't care about volatility then you should be in 100% stocks, in fact, you should take a margin, interactive brokers charge only 1.5% on $300K(link)
So, why do you need bonds? for ballast. Many retirees who accumulate a large portfolio and need a low withdrawal rate (think under 3%) could invest a large % in bonds if they like a lower volatility portfolio.

Same type of articles about bonds for years. HY Munis made over 6% since mid May. Bonds made me a lot more than inflation + 1%

Please don't misunderstand me. I like the idea of reverse mortgages if obtained at reasonable cost and rates for a well defined purpose, as I wrote above. They have gotten a somewhat undeserved bad rap, and they've been improved significantly. They're likely superior for a variety of well defined purposes.
But @bee raised HECMs as a great way to hedge sequence of return risk. For that particular well defined purpose, they may not be the better product. ("Hedge" = "insurance" or "protection".)
Sequence of return risk is the risk that one's decumulation (spend down/retirement) phase may begin during a market downturn. It's not a risk of ever having a market correction. So a hedge against this risk is protection that's needed during the first few years of retirement. This has a few implications:
1. Sequence of return risk is not concerned with what happens after, say, 10 years. So it doesn't matter that a HELOC only enables you to draw against your line of credit for 10 years. Like term life, that's the period that you're "insuring".
2. Since you're only "insuring" for a relatively short period (say, 1/3 of your anticipated retirement period), the fixed (up front) costs of the line of credit weigh more heavily. They are amortized over just a few years, as contrasted with closing costs on a traditional 30 year mortgage. (They also weigh more heavily because you pay these fees even if you never need to draw upon the line of credit.)
3. The amount of protection you need is capped by your anticipated expenses over the first few years of retirement. So the fact that a reverse mortgage credit line grows doesn't matter. (The fact that it might shrink with a HELOC does matter, however.)
4. Since this "insurance" is needed at the point of retirement, one might be able to apply for the line of credit shortly before retirement, thus making it easier to qualify for a HELOC.
In a sense, the whole question of how easy it is to get a HELOC is irrelevant to the question of which one is better. If you cannot get a HELOC then there is no choice to be made.
Permit a metacomment here: I've been fastidious in citing objective third party sources: the FTC, HUD, the CFPB. Pages from provider products can be informative and accurate, but still incomplete. This is something to watch for not just in this thread, but generally.
The Reverse.Mortgage page purports to be presenting information on reverse mortgages generally. But then it quietly slides into features that apply only to HECMs, such as being federally insured. You have to flip to another page to find out that this feature costs 2% of the total line of credit up front, plus 0.5% of the outstanding balance annually.
The comparison chart says that HELOCs become due (balloon payment) after ten years. Some do. But the chart is deceptive here. The Fed writes: "Many existing HELOCs are structured such that when they reach the end of the draw period, they convert from open-ended, non-amortizing lines of credit to closed-end, amortizing loans."
What is best depends on your intended purpose (including risk tolerance) and the terms (including special features) offered.

he still has $1,000,000,000 ???
The only manger I know who was worse is Henry Van der Eb who ran the Mathers fund. He nailed Black Monday and then sat in cash forever after

I nominate Charles Steadman for the dubious honor of being the worst fund manager.
"In the 30 years before Charles Steadman's death in 1997, the average mutual fund was up more than 20-fold. Three of the four Steadman funds were down; all four of his funds - including his lone 'winner' - landed among the 10 worst-performing funds over that three-decade period, according to Lipper Inc."
Link

I was an auditor with Arthur Andersen many years ago. We would send confirmation letters to banks to verify cash balances. Weren't any audit tests used to verify this cash balance valued at 25% of total assets?

I thought it was despicable when, 4 years ago, people were diagnosing Trump as having a mental illness and I find it equally despicable that the Trump enthusiasts are now projecting those same ailments onto Biden. It appears to me that almost everyone over 70 years old stumbles over their words now and then. Prof Siegel’s recent interview with Ritholtz is just one example - but please, no one would say Siegel isn’t capable deep thought. And unless you are a mental health expert using a formal process you shouldn’t say it about anyone either.

https://cnn.com/2020/06/23/tech/wirecard-ceo-markus-braun-arrested/index.html

Wirecard (WCAGY) acknowledged on Monday that €1.9 billion ($2.1 billion) in cash included in financial statements — or roughly a quarter of its assets — probably never existed in the first place. The company withdrew its preliminary results for 2019, the first quarter of 2020 and its profit forecast for 2020.

I can't tell you the number of times I've seen this company as a top holding at international small cap funds such as Wasatch's, Artisan's, Oakmark's and Grandeur Peaks. Although I don't think it's a top holding anymore, this CEO Braun has been in charge for many years and I wonder as with the Sequoia Fund/Valeant and Oakmark/Washington Mutual cases what it says about active management that such frauds go undetected for years. Active fund managers get paid a lot of money to ostensibly do deep research on companies. Yet when these scandals happen you usually don't hear boo about it from them, and I wonder if they either completely missed the fraud despite their deep research or, worse, kept quiet about it. Do managers/analysts report financials that look weird to authorities? And why do they so rarely say anything about the fraud after the fact? I'm not pointing at any particular manager. I'm saying this in general always makes me a little more skeptical about managers' abilities. It seems like this fraud may have been ongoing for years, just like it was in the other examples.

John’s been betting on economic and stock market collapses forever. We finally got the 30% bear market he’s been prophesying for about ten years and 20,000 Dow points. Unfortunately, it only lasted like two weeks and the market immediately rebounded. That’s got to be frustrating, waiting all that time to be right and then being right for a different reason and then it comes and goes in a blink anyway…

something-to-hate-for-everyone/
Hussman's Petition:
house-committee-on-financial-services-senate-banking-committee-stop-the-federal-reserve-from-printing-money-to-buy-junk-bonds?

Again, again, why post this drivel?
This MIchael Lee guy does not know historical correlations of taxation and returns.
>> As controversial as President Trump is, market pros would contend that these types of moves upward in equities wouldn’t necessarily happen if the market was sniffing out the real possibility of a blue wave and higher taxes under a president Biden. There is still time for that pricing in to happen if Trump continues to stumble in the polls, but to Lee’s point the market may simply view Trump as friendlier to one’s investments and the economy at large and that sticking around for four more years.
“I do think for the overall economy, a Trump administration would benefit the masses more than those with financial assets,” Lee adds.

Laughable.
I do not know the longer term, but if Trump loses, the market the next day will jump yugely, I think, just from relief.

perhaps of interest; taken, though not verbatim, from email and docs making the rounds at GS
Subject: Some assorted market stats and anecdotes about what has happened in the last months

It has been a few months of records. They say a lot about the relationship between risk-taking by economic policies and financial conditions.
1. 2020 has likely featured the sharpest -- but the shortest -- recession in US history (certainly since the 1850s for the US, and since WWII on a global scale).
2. in turn, we’ve just seen the strongest rally out of a bear market since ... 1932.
3. the US alone had conducted $2.3T of QE in the past three months (Treasuries + mortgages). For those keeping score at home, that’s an average of around $35B of bond buying per business day since mid-March.
4. GIR expects zero interest rates in the US for several more years -- until the economy reaches 2% inflation and full employment -- which is perhaps not until 2025.
5. largely thanks to fiscal support, GIR expects US disposable income to grow 4.0% in 2020.
7. USTreasury planned to borrow $3T in Q2 alone; despite that supply glut, we’re just off the alltime low yields in US 2y notes and 5y notes.
8. in that same general context, US 30yr mortgage rates are down to alltime lows .
9. the past six weeks have seen the largest amount of global equity issuance on record, at $205B.
10 and 11 are driven by the Fed purchases of corporate bonds:
10. March saw record outflows from corporate bond funds (-$42B); we’re now witnessing record inflows to corporate bond funds (+$85B since the start of April).
11. it’s not just that we’re witnessing record new issue in the credit markets, it’s that we’re also seeing record low corporate financing costs (e.g. AMZN raised $10B of capital at the lowest 3/5/7/10 and 40y yields ever).
What is the rationale for buying 40y bonds now? Don't they want more flexibility? Don't they think that there is a high probability that underlying conditions will change well before 40 years?
One possible explanation: as yields get lower, investors have to go out the yield curve (thus take more duration risk) in order to obtain higher yields (think of a pension fund that needs to generate a fixed return). This would be one example of the portfolio-rebalancing effect of QE. Also note that few investors ever hold bonds to maturity, and a 40y bond would "enjoy", because of its longer duration, a large price appreciation should interest rates fall further (of course the opposite is true if rates increase). Recall that, in 2018-19, the Austrian 100y bond doubled in price as yields declined from 2 percent to 1 percent.
So this would be investors betting that interest rates will not increase from here and may decline further.
12. March saw record outflows from equity mutual funds and ETFs; one can argue we’re now seeing legitimate signs of retail investor euphoria (e.g. a record # of account openings at US retail brokers).
13. subject to interpretation: the market cap of MSFT is larger than the entire US HY market.

One of these years he'll be right again....

Right you are, @msf. That class of the fund has lost an average of 4.18% over the past three years. Even FMI Common Stock has barely broken even.

https://www.google.com/amp/s/www.marketwatch.com/amp/story/suze-orman-urges-investors-to-stay-away-from-traditional-401ks-2020-06-17
Suze Orman: ‘You have to be crazy’ to put your money in this investment
Published: June 19, 2020 at 1:24 p.m. ET
By Shawn Langlois
‘Do you really think that tax brackets aren’t going to have to go up five, 10, 15 years from now in order to pay for all the debt that we’re carrying’
Dont think I am crazy. Ms Orman maybe indeed nutty

Ironic that American Beacon continues to maintain direct account services, but now they will not allow new direct accounts to be opened via exchanges or new applications. Janus Henderson reopens its "D" share class accounts after being closed for 11 years.

This is great. Janus Hederson has a number of good funds, and for years nearly the only way a new Janus investor could purchase shares was to pay an extra 10 basis points for T shares though a brokerage (NTF).
DIY investors do also have an option to purchase I shares through Fidelity (and only Fidelity) by paying a TF, but those shares save just 5 basis points over the cost of D shares. With such a small savings, it takes a long time or a large account to make I shares worthwhile.
Now that Janus is reopening its direct sales channel to new accounts, smaller investors have access to a low cost share class (D) of a relatively low cost family of actively managed funds.
Note that D shares continue to be sold only directly through Janus. I suspect this is due to brokerages refusing to sell retail shares unless they can collect their 40 basis points from the fund family to sell the retail shares NTF.
There's a 2018 thread that covers this (not some of my clearest writing, though).
https://mutualfundobserver.com/discuss/discussion/40037/series-d-n-mutual-funds-the-new-share-classes-of-the-future

Hi guys. I agree with Ms. Schenone about not putting all of ones eggs in one basket.
An interesting fund that makes up about 9% of my hybrid income sleeve is AZNAX. This fund has a distribution yield of 7.7% and disburses 7 cents per share per month. To do this, it is very active in the market with its positioning as it has a 66% turnover ratio. Part of the distribution comes from capital gains and the other parts from dividend and interest income. And, at times, it has also returned some principal. I have been an owner of this fund for better than five years and so far through the years that I have owned it I am net positive on my principal investment plus what it has paid out to my pocket.
For me, it has been a good income generator. If it were not already at a full allocation within its sleeve I'd buy more of it during stock market downdrafts.
This is also a fund that @Scott, who use to post on the board a few years back, touted.
In checking Scott's MFO handle he was last active in December of 2016.
Old_Skeet

Some of us have no choice but to fly. But I can't complain. I knew a guy back on the Mainland, way back 20 years ago, who quit flying and drove everywhere. Too much hassle, even back then.

When I was a child, we met an air traffic controller on the Great Northern Railroad. He loved planes. He hated airports.
If anything is bound to get worse for the rest of us, it's air travel.

Some of us have no choice but to fly. But I can't complain. I knew a guy back on the Mainland, way back 20 years ago, who quit flying and drove everywhere. Too much hassle, even back then.