The writer repeats what many have said for years without more insight.
Why high Div stocks are not a good market barometer? The high tech revolution changed it. For decades now tech companies leads the world in innovation and creating wealth. These companies pay no-lower div.
Quote from the article "Diversification is an admission of ignorance about the future."
Buffett said it a lot better "Diversification is protection against ignorance. It makes little sense if you know what you are doing".

I made a lengthy post this morning regarding callable CDs. If anyone is interested in responding to that, I would appreciate it.

I've had a CD ladder for about 12-13 years. I am 100% against callable CDs. They just don't fit our strategy as callable CDs beg for constant maintenance due to their inherent duration uncertainties.
I have suggested the following strategy to you a few times over the past year or so but you always seem to reject it. I'll try it one more time:
Buy 5-yr, CP CDs at the highest rate you can get and be happy.
Currently you can BUY 5-yr, CP, Fido, Secondary Issue CDs with Effective Yields (after discount) of just under 4.3%.
Had you followed my suggestion over a year ago, you would now have a 4-5-yr, CP CD ladder making over 5%, you would NOT be dealing with constant maintenance of your fixed income portfolio, and you would very likely have more income over that 5-yr period than the option you chose. (You got maybe 5.5% for one year, but now you're likely to get, on average, under 4% for the next 4 years, while I'm getting over 5% for the entire, same 5-years period)
You may not of course. You may have a little less.
BUT, you would have saved all the time and angst that was effectively wasted on fixed income portfolio maintenance. And that time is critical to us for (1) enjoying life and (2) spending it more productively on the portion of our portfolio that really matters, our stock sleeve.

DT: FD, I get your position. You are not a CD investor, you will never be a CD investor, and you will continue your trading approach that does not include CDs, which requires liquidity in your holdings. My original post was directed toward existing CD investors, deciding what those particular investors will do with their maturing CDs, not directed toward investors who will never hold CDs. If you want to "convert" the rest of us CD sinners, you will do it without restraint on this thread.

I'm not trying to convert or influence anyone. I'm stating generic comments.
I don't know anyone that invests only in 100% safe CDs and treasuries, and over the years I discussed investments with many people. I also don't like callable CDs and now have to find a new solution.
This is not a judgement, just an observation.
I switched to only/mostly bond funds because I could generate more performance than allocation funds with much lower risk.
To the questions, what would you if...? My approach has been tested in a recession, high inflation, and very quick rising rates, and it went well. Why change it?
I want to control my portfolio at all times. At anytime I can own MM,CDs, Treasuries if I want, but they have to be the best idea I have in that moment based on market conditions. It already did. From 01/2022 to early 11/2020 I was at 99+% MM, except very short (hours-days) several trades.
You should do what works for you. Good luck in the future.
I just don't believe we should stay on a narrow discussion. Annuities brought up, and I believe in low-volatility bond funds that might interest some posters.

msf said:

People may not have noticed that muni MMFs have been soaring of late, especially NY. Schwab's $1M min version, SNYXX, has a 7 day yield of 3.49% (APY 3.56%), its retail version, SWYXX has a 3.34% yield (APY 3.40%), and Fidelity's $25K min version FSNXX is at 3.28% (3.33% APY). That 3.3% is worth about 4.8% APY in a CD for someone in NYC in the 22% tax bracket. And its yield is rising.

I follow the SIFMA Municipal Swap Index Yield, which is calculated and published Wednesday afternoons. Because of the holiday, that did not occur today, but will tomorrow. The yield on muni money market funds follow this yield. Here is the past 5 weeks and as you can see, the yield is all over the place. For reasons that I do not understand, the line on the chart has been serpentine for as long as I have been watching it, which has been a few years.
11-20 3.18
11-27 2.86
12-4 2.15
12-11 2.91
12-18 3.60
Below are recent yields for VMSXX and SWOXX and again, they follow the weekly SIFMA Municipal Swap Index Yield. We will see what tomorrow brings.
11-19 3.38% 3.29%
11-20 3.41% 3.30%
11-21 3.33% 3.22%
11-22 3.14% 3.07%
11-25 3.09% 3.03%
11-26 3.03% 2.99%
11-27 3.00% 2.97%
11-29 2.90% 2.91%
12-2 2.85% 2.87%
12-3 2.79% 2.81%
12-4 2.70% 2.72%
12-5 2.55% 2.59%
12-6 2.17% 2.23%
12-9 2.07% 2.11%
12-10 1.99% 2.07%
12-11 1.99% 2.08%
12-12 2.13% 2.20%
12-13 2.58% 2.61%
12-16 2.72% 2.74%
12-17 2.83% 2.84%
12-18 2.95% 2.94%
12-19 3.05% 3.03%
12-20 3.32% 3.25%
12-21 3.42% 3.33%
12-24 3.59% 3.49%

I made a lengthy post this morning regarding callable CDs. If anyone is interested in responding to that, I would appreciate it.
Hey, it takes time to compose :-) Done.

At Schwab, major banks are offering long term callable CDs (18 month, 2 year, 3 year) of 4.4 and 4.5%, with the first callable date in July of 25. That tells me, I can get the equivalent of .3 to .4% more than a noncallable 6 month CD at Schwab. If the Bank does NOT call it in July of 25, you will continue to receive the 4.4 to 4.5% interest rate until they do call it.
For callable CDs at Schwab, major banks are offering 4% long term rates, so the Banks appear somewhat confident that interest rates will not drop below 4% for the next few years? I don't understand Banks offering callable CDs at these rates, if CD rates were expected to continue their rapid decline of the past year, as some posters are projecting?

One way to think of callable CDs is not as 2 year loans with a call option exercisable in 6 months but as 6 month loans (to the bank) with a put option held by the bank (on a 1.5 year loan) exercisable in 6 months. IOW, the bank is paying you about 1/4% extra interest over six months in order to have the option to "force" you to loan them money at a predetermined rate (say, 4.5%).
The bank is betting that mid-to-long term interest rates will go up, and it is willing to pay you a sweetener on a 6 month CD in order to lock in that 4.5% rate. Banks aren't always right, though one should look carefully before betting against them.
Regarding 10 year rates, Schwab writes:

With the potential for fewer Fed rate cuts and a higher deficit to fund, investors could reasonably demand more yield to compensate for those risks. A return to the average of the historical range could add as much as another 50 basis points to 10-year Treasury yields, all else being equal. That would mean an estimate for 10-year yields of near 5%. Hence, we are cautious about duration because the risks for long-term yields appear skewed to the upside.

https://www.schwab.com/learn/story/fixed-income-outlook (Dec 4)
Everyone expects "cash" (fed funds rate) to drop 25-50 basis points. What happens with rates for periods between 0-years and 10-years may be up for grabs. If they drop, buying a callable CD may leave you with the added "sweetener" and a reinvestment task in six months. (The CD gets called.) If these rates rise, there will be an opportunity cost (you're "stuck" at 4.5%). But that's okay if you're satisfied with the rate.
Here's an interesting way to hedge your bets at a cost of course. You can lock in a 4.21% APY for a year where you (not the bank) control what happens - you can add money (no limit) if rates decline, or withdraw money (up to two withdrawals).
Credit Human (an NCUA insured credit union) is offering a Liquid Share Certificate with those terms.
Does any of this matter? Not a lot, not really. One can slice and dice the risk between lender and bank in a variety of ways and with a range of costs ("sweeteners"). But in the next year or so, it may not make a whole lot of difference. That is, the variations are endless, but the risks and rewards being moved around may turn out to be relatively small.
(Credit Human also offers 19-23 month CDs with APY of 4.4% without call risk.)
Personally, I'm content leaving cash in MMFs (or very short T-bills) for a couple of months to see how the markets shake out after Jan 20th.
People may not have noticed that muni MMFs have been soaring of late, especially NY. Schwab's $1M min version, SNYXX, has a 7 day yield of 3.49% (APY 3.56%), its retail version, SWYXX has a 3.34% yield (APY 3.40%), and Fidelity's $25K min version FSNXX is at 3.28% (3.33% APY). That 3.3% is worth about 4.8% APY in a CD for someone in NYC in the 22% tax bracket. And its yield is rising.
Play the game, add a small amount of return and more stress. Settle on a fixed rate for a few months or a couple of years, and relax more. If you're not into the hunt, the latter may be the better path.

The biggest problem with CDs and annuities is that most hold them while giving up good opportunities in bondland. I can trade my funds any day.
Vanguard 10 years estimates (https://advisors.vanguard.com/insights/article/series/market-perspectives)
If the above is correct, I prefer to be in bonds and make just 6%.
Someone in 20/80 (stocks/bonds), can have similar performance to 50/50, but with much lower volatility.

One definitely needs to balance performance with opportunity costs. When I made that calculation, it was worthwhile for me to invest in MYGAs (Multi-Year Guaranteed Annuities) with guaranteed annual returns of 6%, 6.35%, and 6.5% for three, seven, and five years, respectively. Unless I withdraw funds from them, the returns are also tax-deferred which allows me to plan withdrawals or let them ride to maturity as suits my situation.

The biggest problem with CDs and annuities is that most hold them while giving up good opportunities in bondland. I can trade my funds any day.
Vanguard 10 years estimates (https://advisors.vanguard.com/insights/article/series/market-perspectives)
If the above is correct, I prefer to be in bonds and make just 6%.
Someone in 20/80 (stocks/bonds), can have similar performance to 50/50, but with much lower volatility.

FD, I get your position. You are not a CD investor, you will never be a CD investor, and you will continue your trading approach that does not include CDs, which requires liquidity in your holdings. My original post was directed toward existing CD investors, deciding what those particular investors will do with their maturing CDs, not directed toward investors who will never hold CDs. If you want to "convert" the rest of us CD sinners, you will do it without restraint on this thread.

The biggest problem with CDs and annuities is that most hold them while giving up good opportunities in bondland. I can trade my funds any day.
Vanguard 10 years estimates (https://advisors.vanguard.com/insights/article/series/market-perspectives)
If the above is correct, I prefer to be in bonds and make just 6%.
Someone in 20/80 (stocks/bonds), can have similar performance to 50/50, but with much lower volatility.

I thought I would revisit the option of Callable CDs, what Banks are communicating about CD rates, and the merits of including them in your CD investment selections. At Schwab, major banks are offering long term callable CDs (18 month, 2 year, 3 year) of 4.4 and 4.5%, with the first callable date in July of 25. That tells me, I can get the equivalent of .3 to .4% more than a noncallable 6 month CD at Schwab. If the Bank does NOT call it in July of 25, you will continue to receive the 4.4 to 4.5% interest rate until they do call it.
For noncallable CDs at Schwab, major banks are offering 4% long term rates, so the Banks appear somewhat confident that interest rates will not drop below 4% for the next few years? I don't understand Banks offering callable CDs at these rates, if CD rates were expected to continue their rapid decline of the past year, as some posters are projecting?
So I am revisiting my position of "only" using noncallable CDs, and the risk/rewards of investing in higher rate Callable CDs, at a rate that you can only depend on for the next 6 months, but you may end up getting that higher rate for a longer period of time at the higher rate. I am taking the Feds statements that the rapid reduction of interest rates that we have seen in 2024, will likely not continue in 2025, and we may not see any interest rate declines in 2025.

@Crash, especially in the case of public parks, Republicans have been cutting park budgets for thirty years, forcing the park managers to enact entrance fees and raise them time after time. That's the price we're all paying (elections have consequences). So yeah, that's your choice and your principle, but please realize why it's that way.
I don't know about libraries generally, but they may run into budget shortfalls and have to add or raise fees to stay open. The library where I live is a city gov. property but has both a friends group and a foundation that raise money for it. A lot of money, and that's what it takes to be free for the public, even in a town that totally supports libraries and education.

YBB,
Thanks for the perspective.
Good to know a AAA insurance company can keep one up at night for years.
During GFC, I had many times over the FDIC limit in a savings account at a money center bank. I did not lose any sleep because I know this industry but I never had an opportunity to know the insurance industry the same way. So, understanding risks goes a long way in one's risk assumption and risk diversification.

Bond rating and insurer ratings have very different criteria. And different things happen in cases of failures.
If a company issuing bond goes under, bond investors are in line with other creditors depending on where the bond is in the capital structure. They can get something or nothing.
If an insurer goes under, its state regulator works as the lead regulator with the other state regulators to come up with a rescue/rehabilitation plan.
State regulators don't have ready reserves to pay out like the (underfunded) FDIC does for banks.
So, a failed bank may be shut on Friday and account access may resume on Monday. Forget about anything like that for failed insurers.
When my 403b plan insurance MBL-NJ went under (I think with AAA rating & 150 years of existence), all of our 403b annuity accounts were frozen. We could immediately withdraw/shift at 40% haircut (i.e receive 60c for $1), or wait for things to settle. While waiting, the frozen funds earned m-mkt rates that were about half of what MBL was paying. The money was unfrozen after 4-5 years. Technically, there was no loss, but only the lost opportunity. In my asset allocation at the time, I treated this frozen money as forced-cash.

Fixed rate deferred annuities, if used as savings vehicles (and not annuitized) are very much like CDs. Like CDs, and unlike funds, stocks, etc., their value cannot go down.
https://www.blueprintincome.com/fixed-annuities-cd-comparison
There is the risk of the insurer issuing the annuity going under, just as there is the risk of a bank failing. In the case of a bank failure, a government agency (FDIC) steps in, tries to get another bank to assume your bank's liabilities. If it succeeds (almost all the time), you may be forced to choose between taking you money (including interest to date) and running, or accepting a lower return for the remainder of the time on your CD.
In the case of an insurer (the issuer of your annuity) failing, it is a state government agency that steps in. As with banks, states first try to "rehabilitate" insurers - either get them back on their feet or have another insurer take over their liabilities. Should they not succeed, the insurer is liquidated.
Here's Pennsylvania's general description (not state-specific) on how that proceeds. A state-created guaranty association pays for losses not to exceed state limits. Again, similar to what the FDIC does for banks. A key difference is that state guaranty associations are typically underfunded. So it is important to stick with better rated insurers. (Rehabilitation/liquidation is to be avoided in any case.)
Pennsylvania FAQ on insurance company liquidations
Single Premium Deferred (fixed) Annuities are rather simple vehicles if one does not annuitize (i.e. one uses them like CDs). The key numbers are:
- guarantee rate,
- number of years rate is guaranteed,
- floor for annual renewal rate after that (insurer might offer more depending on market),
- penalty each year for early withdrawal (e.g. 7% in year 1, 6% in year 2);
- amount/percentage that can be withdrawn annually without penalty
There should not be a penalty for withdrawing everything once the multiyear guarantee period is past.
Something that has been added in the past decade or two is MVA - market value adjustments. Suppose interest rates have gone up since you purchased your annuity. Then, like a bond, the value of your annuity has dropped. If you close out your annuity early (effectively "putting" your policy), you are forcing the insurer to overpay (i.e. pay 100% of face value minus any early redemption charges). MVA lets the insurer adjust the payout accordingly, so that it doesn't overpay.
Conversely, if interest rates drop, your annuity is worth more than face value (plus interest). MVA adjusts the payout upward, so you "win". Many annuities but not all these days come with MVA.
https://smartasset.com/financial-advisor/market-value-adjustment
MVA seems to enable insurers to issue policies that pay a bit more. But they're shifting market risk onto you, in case you redeem early.
Here are Mass Mutual's rate sheets for its 3-5 year Stable Voyage Policies (no MVA) and for its Premier Voyage Policies (with MVA). The latter have higher rates, e.g. 4.25% or 4.35% on policies under $100K, while the Stable Voyage Policies (no MVA) pay 4.2%.
Stable Voyage rate sheet (Dec 30th)
Premier Voyage rate sheet (Dec 30th)
Important: These rates are dated Dec 30th. They are less than the rates I found quoted today. So rates on these annuities are about to drop.

You are absolutely correct that each poster/investor is unique in their own ways. I was directing my thread to other similar posters with "maturing CDs", and I was curious as to what CD investors were choosing to do with that cash. But there are no rules on these threads about posts, as long as they are civil.

As you you like it. But I didn’t get the impression initially your intent was to limit the scope of the thread to CDs and to rule out other types of investments. Perhaps the reference below from your OP was to some “more active” variations of CDs? I don’t invest in CDs, so wouldn’t know.

At 76 years old and happily retired, I have been investing in CDs for the past few years. About 1/3 of my CDs will be maturing in the next month. It appears that the renewal rate, for "noncallable" CDs, will be around 4.3%. That is about 1% lower than the maturing CDs. I am wrestling with renewing at the 4.3% rate, with almost no stress, or jumping back into the more active investing options. Anyone else in a similar situation?

@msf,
"No loss of principal, "high" rate that cannot drop, some liquidity, and tax deferral."
Could you please elaborate on your “No loss of principal” comment? I know next to nothing about annuities, except having looked at them superficially about 20 years ago when I was debating about my DB plan and not getting comfortable taking on credit risk of the insurance companies. I probably missed a good opportunity if there was no risk of loss of principal but it is never too late for me to learn and try invest in new things.
Hopefully, YBB will join the annuities conversation with you and stillers, as I recall YBB commenting about annuities over the years.
P.S.: I am yet to read the links posted in both msg and stillers posts and educate myself.
Thanks.

Great stuff by @msf on annuities. I agree they are a viable option at this time. Guessing they were even more so about 6-12 months ago when rates were at/near their peaks.
That said, annuities have always been a 4-letter word to us. Too high fees, loss of control over your money, difficult if not impossible to understand terms, etc.
Not saying all of the drawbacks can't be overcome, but any prospective buyer MUST identify and understand all of the many mistakes they can (and others often do) make when buying them. Or things may not go as planned/expected.
Here's some primer links in the event anyone here is so inclined. If it's our money, I wouldn't stop with reading just these:
https://annuityguys.org/five-annuity-mistakes-you-should-avoid/
https://www.investopedia.com/articles/investing/022316/5-mistakes-avoid-when-shopping-annuities.asp
https://www.neamb.com/retirement-planning/7-common-annuity-mistakes-and-how-to-avoid-them
EDIT: Barron's does an annual review and report by annuity type that I consider the best on the planet and would absolutely use as our primary guide if ever seriously considering an annuity.
(Note: A few years ago we did consider one and passed.)
https://www.barrons.com/topics/best-annuities

Another observation. Do Fidelity, Schwab, and Vanguard have their own Dow Jones funds? No, they don't. Do they have the SP500? YES.
Years ago, back when Vanguard was providing free financial plans, my mother had them work up a plan. Several years prior, Vanguard had introduced its own index funds (working with MSCI to develop more tax efficient indexes). Yet the plan used Vanguard 500 rather than its broader based, better performing (at that time) large cap index fund.
I asked the planner why. As near as I could decipher the response, it was because Vanguard 500 was better known/more popular. Financial decisions are often made by "popular demand" and not by objective analysis.
This is not to say I think the DJIA is especially representative of "the market". Just that looking at who is offering what is not the best way to validate that.
OTOH, which market index does Fidelity display by default on its home page? Clue: it's up 200 points today and it's not the NASDAQ.

I've invested in so many cash, short term, and fixed rate vehicles that I've lost count. The ones that come to mind are: prime MMFs, government MMFs, Treasury only MMFs, national tax free MMFs, single state MMFs, ultra short bond funds, short term bond funds, short term national muni bond funds, short term single state bond funds, short term government funds, short-intermediate national muni funds, T-bills, short and intermediate CDs, liquid CDs, callable CDs, short term muni bonds, callable muni bonds, SPDAs, and GICs (stable value).
I've used some of these when the idea of losing even a single penny was an anathema to me, and I've used some when I was seeking a better multi-year return. So I appreciate different objectives, especially the concern about share prices declining. (What, you mean I could actually lose money? I've had those thoughts.)
Some people here have said that they would not use a prime MMF - too much risk for the small additional return. Actually, the risk goes further - scores of MMFs have been propped up by their sponsors over the years, including several that would otherwise have broken a buck. Regulations have changed since then; still, prime MMFs remain more risky.
https://libertystreeteconomics.newyorkfed.org/2013/10/twenty-eight-money-market-funds-that-could-have-broken-the-buck-new-data-on-losses-during-the-2008-c/
One used to see SNGVX mentioned as a safe short term fund (see, e.g. here) - it never had a losing year. That was before 2021, when it lost almost 1% followed by 2022 when it lost nearly 4.5%. So when it comes to OEF bond fund risks, your concerns are understandable.
ISTM David Sherman manages his short term funds in an unusual if not unique way, resulting in his CrossingBridge funds as well as RPHIX never having had a losing calendar year over their lifetimes. Admittedly, they are not without some volatility as your 2020 experience attests. That you pulled the trigger so quickly then also attests to the great importance you place on preservation of principal.
@stillers wrote: "4% guaranteed interest is our threshold vs bond OEFs. 5+% is pretty much nirvana." That seems to be your thinking as well: "I want to lowest risk option to produce 'at least' 4%." Further, you seem willing to make a multi-year commitment (you're considering callable CDs that if not called, will take several years to mature).
Based on that, welcome to nirvana. Another poster mentioned MYGAs, aka fixed rate SPDAs.
https://www.blueprintincome.com/fixed-annuities-cd-comparison (fixed annuities vs. CDs)
You can get a 3 year fixed annuity with an A rated insurance company yielding over 5%. Depending on your state it may even allow 10% of balance withdrawals without issuer penalty, mitigating liquidity concerns. One does need to be over 59.5 to take withdrawals without tax penalty.
If you want a policy from an AA+ rated insurer, MassMutual is paying around 4.65% for three years, depending on your state of residence. All of these policies have the added benefit of tax deferral (for taxable accounts), including the ability to "roll over" the proceeds (1035 exchange) to extend the deferral period. No loss of principal, "high" rate that cannot drop, some liquidity, and tax deferral. Seems to check all your boxes and more.

@PRESSmUp: even tho we live in a metropolitan area of SE MI, our house might as well be in rural MI for connectivity purposes. The neighbors have Xfinity, but that company wanted $3500 in 2008 to connect our house. We tried a TV dish antenna for 2 years with cell phone hotspot for internet and had spotty results. The only provider serving us is ATT; the internet, TV, and landline services depend on our phone line. We are almost 3500’ from ATT’s distribution box, so we can have 2 HD channels on at the same time, but not 4 because of the distance. This matters when I might be taping a sports event and watching another one. We don’t watch many movies; Netflix on the smart TV meets our needs there. As for the price, even with modest internet speed and the second tier of TV offerings, it has risen to $335 per month. Talk about a screw job. I am an inveterate channel switcher so going from one streaming service to another in the time it takes the pitcher to deliver the next slider is an obvious impossibility. We could easily drop the landline and save a bit, granted. When I have to call ATT for billing or service problems, I follow a friend’s advice: keep saying over and over, “I want to speak to a real person.” It has worked before, although the service rep may not share my way of speaking English.

I received notification of class action suit today & was wondering if others here had TRF's at Vanguard. Sold my TRF's shortly after getting the shaft a few years ago.