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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.
  • Anyone care to venture a guess where S&P ends the year ?!
    If you change the aspect ratio of the Shiller cape, it may change how we think, to some extent (using family history site as graph placeholder).
    Tech bubble is quite clear, otherwise smoothish growth w 08-09 dip and recent sick runup, but how odd really, given tina / cheap money? 1980ff.
    https://davidrmoran.files.wordpress.com/2021/04/shiller_pe_asprat.png?w=1024
  • Secure Home Lenders / Oaktree Capital Move to Take Over Company
    “Private-equity-owned Secure Home Holdings LLC filed for bankruptcy protection after its top-ranking lenders agreed to award themselves the home-security systems business, leaving unsecured creditors owed $110 million unpaid ... Bank lenders are owed, in the aggregate, about $197 million ...”
    “The terms are proposed in a ‘prepackaged’ chapter 11 reorganization plan that Secure Home filed Monday, shortly after the Sunday bankruptcy filing. Ballots haven't been cast yet, but top lenders, led by affiliates of Invesco Ltd. , have agreed to cancel part of their debt in exchange for ownership of Secure Home.
    “Funds managed by Oaktree Capital Management * mostly own Secure Home, with Ironwood Capital and Alcentra Capital Corp. as minority stakeholders. Oaktree declined to comment.”

    The Wall Street Journal, April 27, 2021
    * Oaktree Capital Management / The Oaktree Funds specialize in distressed debt and are headed by Howard Marks who is often quoted on the board.
  • Credit Suisse Investors / Harris Associates Target Board Over Archegos ...
    “Top shareholders said they would vote against re-electing key Credit Suisse Group AG board members, a broadside against the bank’s leadership following a $5.5 billion loss from hedge fund Archegos Capital Management.
    “At the bank’s annual meeting this Friday, Harris Associates* and Norges Bank Investment Management said they would vote against the reappointment of Andreas Gottschling, chairman of the bank’s risk committee. Mr. Gottschling joined the board in 2017 from the top risk job at Austria’s Erste Group Bank AG.
    “David Herro, a partner at Harris Associates with a roughly 8% stake in Credit Suisse, said he would vote against Mr. Gottschling because he was the director in charge of risk.
    “Norges, an arm of Norway’s central bank that runs its sovereign oil fund, owns around 3% of Credit Suisse. It said it would also oppose re-electing the lead independent director Severin Schwan, who is chief executive at Roche Holding AG , and Richard Meddings, a veteran British banker who joined the board last year ... Under Swiss rules, more than half of voting shares must go against a Director to block re-election.”

    From: The Wall Street Journal - April 27, 2021 - Reported by Margot Patrick
    * Since Harris Associates operates the Oakmark Funds, I’ve elected to include this under fund discussions.
  • When to take Social Security
    My current thinking is to wait until age 70. That gives me 5 years (age 65 to age 70) to convert tIRA money to a Roth without having SS push me into a higher tax bracket. (Before age 65, my conversions are limited because I am on ACA).
    As Kings53 said - 15% of your SS will be tax free, so it pays to make that as big as possible. For some, that tax free portion will be higher.
    As one data point, my FIL waited until 70 to collect - he’s 97 now. His checks haven’t kept up with his personal inflation but we are certainly glad they are not 30% less.
  • Market Cap Quirks And Rolling Bubbles
    Ya @carew38. I remember the late 70s, early 80s...punks worked at grocery stores bagging and in union making $12+ gazebos an hour, then load trucks for UPS part time making $15 + an hour...do the math, you could do real well with no college back then... now, hmm.
    Best
    Baseball Fan
  • Market Cap Quirks And Rolling Bubbles
    1979 was also the peak year for manufacturing employment . Anecdote from 1979: a classmate from high school was working as a Pepsi teamster driving trucks that summer. His pay was $9 per hour, when the minimum wage was $3.35 hourly. $9 is still higher than our Federal Minimum Wage. Of course, it helped that his father worked for Pepsi as well !
  • MIT researchers say you’re no safer from Covid indoors at 6 feet or 60 feet in new study challenging
    "By assuming that the respiratory droplets are mixed uniformly through an indoor space, we derive a simple safety guideline for mitigating airborne transmission that would impose an upper bound on the product of the number of occupants and their time spent in a room. "
    This may be required by the study, but it is not realistic, as the source of the infection in any room starts as a point source. The particles would eventually mix uniformly, if there were no outside air, no ventilation etc, no doors opening etc. The studies in Chinese restaurants show getting infected depends on 1) proximity to case and 2) the direction of the air movement and 3) duration.
    We demonstrate how this bound depends on the rates of ventilation and air filtration, dimensions of the room, breathing rate, respiratory activity and face mask use of its occupants, and infectiousness of the respiratory aerosols.
    Most of these factors are not measurable in real life situations, although increasing air filtration, larger rooms, and masks will reduce spread.
    Singing is the worst thing you can do, followed by sitting in a dark low ceilinged bar wt a bunch of drunks.
  • REAL ESTATE, selling home
    Greetings,
    Curious as to the class' life experience in selling a home. Wife and I are getting ready to sell our wonderful home after 25 years...
    Have found out that real estate agents are generally not worth their comission fees. None of them will help you find a home unless your budget is over a 1.5M. Then they will chauffeur you house to house to look at them. Otherwise you surf the net or they take your email and put you on an auto email with all the beat up overpriced crap homes on them, waste your time and then they unlock the door for you and walk thru the home like they are experts. Sheet.
    They have this game they play, called comps. Called the shall we say Orange Fish agent, showed me chart how he gets 99% of ask price then tells me based on comps your house is worth xyz. I say really. You can't find another home for sale in my neighborhood of over 300 homes. The one's that have sold have sold in a day and sold for $10k over ask. What do I care what a home sold for 10 months ago. Can you sell me SPY ETF at the price it was 10 months ago? No, then why the freak should I go to market with an old price? I told him no wonder you gave me the 99% figure. You are selling me on my selling my home under it's current value so you can sell my house in a weekend and move onto another sucker. Then he starts telling me what I should fix up on my home as with an FHA loan you will get a high degree of inspection, don't want to fail that. Told him go freak himself, I'm not going to add onto this housing charade by selling my home to someone who can only put 3.5% down and leverage himself to the hilt. Told him this conversation is over, you can leave now, don't let the door hit you on the arse on the way out, bye bye.
    What has been your experience and apologies if this should be in off topic etc
    Baseball Fan
  • Market Cap Quirks And Rolling Bubbles
    Thanks @Mark, very informative article.
    Here's the accompanying articles to the chart:
    https://epi.org/productivity-pay-gap/
    This chart says it all...the end of the American middle class wage.
    image
  • Market Cap Quirks And Rolling Bubbles
    As usual Ms. Schwartzer does another excellent job of distillation.
    Summary
    ° An overview of some mechanics on how market capitalization works as it relates to bubble formation.
    °A look into the feedback loop of lower corporate taxes, wider trade deficits, and reinvested trade dollars into US assets.
    °Things to look for as it relates to the risk of US market capitalization as a percentage of GDP topping out.
    Market Cap Quirks And Rolling Bubbles
  • The Global Chip Shortage
    @AndyJ is right about EWT. Not surprisingly, TMC makes up 19%+ of AUM. @Sven is also correct; TMC can be found in just about every diversified EM fund and in many international funds.
  • A capital gains tax hike might sink stocks. Here’s how financial advisers and their clients can sta
    I sometimes imagine the Cayman Islands as just one big UPS Store with shiny walls of P.O. boxes for the tax shelters and a few palm trees in the background. This is fascinating reading: https://taxjustice.net/cms/upload/pdf/Tax_Notes_0707_Lessons_from_the_war_on_tax_havens.pdf
    If the U.S. truly turned against these havens--and it had in the past briefly--I doubt there would be anything they could do to stop us. The Cayman Islands has a population of 66,350 and anywhere between $1.5 trillion and $1.9 trillion custodied there, depending on which estimate you believe. But the U.S. never will, especially with Biden who represented America's biggest haven for other countries--Delaware--for many years.
  • A capital gains tax hike might sink stocks. Here’s how financial advisers and their clients can sta
    Just posted today:
    "By Andrea Shalal and Trevor Hunnicutt, WASHINGTON (Reuters) -
    President Joe Biden's forthcoming capital gains tax hike proposal would affect only a 0.3% slice of U.S. taxpayers, a top economic aide said on Monday.
    Biden is set this week to propose nearly doubling taxes on capital gains to 39.6% for people earning more than $1 million, Reuters has reported, in what would be the highest tax rate on investment gains since the 1920s.
    The soon-to-be-announced tax hike will treat those investment gains as wages for top earners and applies only to about 500,000 households, according to Brian Deese, who runs Biden's policy-writing National Economic Council."
  • When to take Social Security
    @davidmoran,
    There are reasons why American above age 62 may not be able to work.
    A lot of people can't afford to wait to sign up for Social Security. Consider that most Americans have not saved enough for retirement.
    "The biggest challenge for most people is they under-save for retirement," Houston says. Many people can improve their financial situation by working in retirement, but you could also end up retiring earlier than you planned to. "They can work in retirement, but unfortunately 50% of Americans end up retiring before they had planned for three reasons: The first reason is their health, the second reason is their spouse's health and the third reason is that their services are no longer necessary – they were terminated," Houston says. So, planning to continue to work during retirement is not always an option.
    The reality for many older Americans... they have to work to make ends meet...that means collecting SS @ age 62 and working a job.
    The fastest labor growth rate comes from those 65 and older:
    image
  • MIT researchers say you’re no safer from Covid indoors at 6 feet or 60 feet in new study challenging
    Several more potentially unsafe scenarios:
    1. Indoor sport games, i. e. NCAA, Olympic events
    2. Church gatherings with singing
  • MIT researchers say you’re no safer from Covid indoors at 6 feet or 60 feet in new study challenging
    No safer at 1000 feet, either. What is so surprising in the fact that in many situations subject to a variable, that variable loses impact beyond a certain point? Common as dirt.
  • The Global Chip Shortage
    @Sven et al
    The initial reports began about one month ago, but this BBC story is a recent update.
    Having lived in Taiwan (Taipei area) for 2 years, I continue to follow a variety of news about the country, over the years.
    ADD: Phoenix plant Taiwan Semi
    Not a fix for the current circumstance, but........
  • The Global Chip Shortage
    Taiwan semiconductor manufacturing company, TMC leads the world in contract manufacturing for these chipsets. And there are several more including one Chinese one (5th ?). Lot to catch up as the capacity has max out. TMC is building a plant in US but this will not solve the immediate shortage.
    As investors it is important to check the top 10 holdings in your international funds or ETFs. TMC is held in many funds.