The Week in Charts (12/23/24)
Put These Charts on Your Wall For Reference The Next Time You Think:
00:00 Intro
00:23 "All-Time Highs Are a Sell Signal"
01:39 "Investment Returns Are Linear"
02:41 "Overbought/Oversold!"
04:20 "Credit Card Rates Can't Go Any Higher"
04:58 "Spreads Can't Get Any Tighter"
06:05 QT and Stock Returns
07:23 Inverted Yield Curve and Stock Returns
08:41 Fed Cuts and Higher Mortgage Rates?
10:09 Most Unaffordable Housing Market Ever
11:35 "Vacancy Rates Can't Go Any Higher"
12:39 "You Can Trust All Government Inflation Data"
13:53 "EM Can't Possibly Underperform Any Longer"
14:52 "US Stocks Can't Possibly Outperform Any Longer"
16:23 "Markets Follow a Normal Distribution"
18:01 The Milei Miracle
18:55 "The Biggest Companies Can't Get Any Bigger"
20:16 "Cars Are Appreciating Assets"
21:28 "Rolex Watches Always Go Up in Value"
22:59 "The Past = The Future"
24:01 "Picking Stocks Is Easy"
25:02 "A Valuation Can't Go Any Higher"
25:53 Shorting on High Valuation
26:43 "Investors Are Rational"
28:34 "This Streak Can't Go On Any Longer"
29:54 "Profits Don't Matter Anymore"
31:19 "It Can't Go to Zero"
32:11 "Bonds Are Risk-Free"
33:29 Meme Stocks
33:54 "Correlations Are Static"
35:53 Headlines
37:11 National Debt
38:45 Big Winners = Big Drawdowns
39:56 This Has to Be the Top
41:02 The Travel Comeback
42:21 Capitalism vs Communism
43:50 Wall Street Can't Predict the Future
45:06 Why You Need to Invest, In One Chart
46:27 There Is No Impossible in Markets
Video
Blog

@Crash $2 rental ?! Maybe it's goes to coffee & rolls. Graft at the public library. Do they charge for other material ? Copy machine is 25cents BW, color $.50 per piece at local library.

@hank- I was under the impression that you were using Musk's Starlink. Have you switched to fiber optic? If so, is that service relatively new around there?

Yup. I was early by 1-2 years in my neighborhood in having high-speed broadband when I put up a Starlink dish in November 2020 (rooftop mounted due to the tree line). Was very proud to have been an early (beta) user. Was miles ahead of the 4G cellular I’d relied on for internet. However, Musk kept jacking up the monthly rates (from around $99 initially to $135 over 3 years) and then announced plans to impose rather tight data limits.
Fortunately, by that time fiber had been installed here. Not burried but strung on poles. Less expensive & no data cap. So ditched Starlink about a year ago. A story of progress! Actually, when I retired in ‘98 and moved to this area all we had was dialup internet. Took 3-6 hours to download a single music album! I bought a DirectTV kit back then at K-Mart for about $50, nailed it up on the side of a garage, burried cable to the house, and had access to great TV for that day. Something like $29 a month back then.
* I should add that prior to 2020 there were a couple satellite based internet companies who had a few subscribers here. But the reports were poor. Essentially, slow connections and high prices.

Some depends on what you need. Low-lying lake shore area here. Can’t pick up any of the locals due to nearby hills + forest - even with a substantial tower mounted antenna. I’ll bet most of you folks can receive your locals. Not that the locals are that great. But if you want the major networks / local stations out here you need to subscribe to something.
I’ve gone from DirectTV (rooftop dish receiver) to Hulu / Disney / ESPN (internet based) to UTubeTV (internet based) over the past 5 years. Prices fell with each change. UTube TV’s live TV package just jumped from $73 to $85. But it’s a very inclusive package with ESPN, TNT and lots of other sports channels. No complaint. Don’t mind commercials for regular programing. Hate for movies. Rent an occasional movie from Amazon Prime for $5 or buy the CD DVD used from E-Bay. Also, you can buy movies at Prime, save in your library and view them as often and for as long as you like.
I haven’t noticed any difference in the number of commercials among the 3 sources I’ve tried. DirecTV was horrible to work with. Glad to be rid of them. Hulu / Disney were fine to deal with. The Hulu / Disney package included commercial free movies. But you tire of the Disney branded eventually.

update:
https://www.sec.gov/Archives/edgar/data/866256/000119312524284083/d878420d497.htm

What changed?
The Dow doesn't matter as much because the SP500 is a weighted cap index. The best performing companies take a bigger share which is based on the price.
How many 401K have the SP500 or VTI and how many have the DOW Jones? I have never seen the Dow and I looked at dozens over the last 3 decades...and for a good reason.

I cut the cable cord early this year and save a bunch of money. Mostly the same programming plus more. My bill was cut from ~220 with spectrum cable to about 89+55=144 for Hulu+ and Greenlight for internet (faster fiber optics). And yes, commercial free for movies, series and DVR'ed programs.

raq,
That's correct if someone has risky stuff, DT doesn't. I respect DT decisions and his choices.
When I used to own both stocks and bonds, my bond funds were never the "safe" ones. My first bond fund that I bought in 2010 was PIMIX. Then, I prepared for my retirement in 2018. By the end of 2017, PIMIX was over 50% of my portfolio.
All my funds must be top performers ALL the time in their category based on risk-adjusted performance.
RPHIX vs MM. I'm with msf. As I said before, when rates fall, and they will eventually, RPHIX would do better.
But, why stop with RPHIX? Let's look at DHEAX+CLOI. For one year...VMFXX(MM) made 5.3%...DHEAX made 9.1%...CLOI 8.2%. Both volatility max loss was -0.5%. See chart (https://schrts.co/zbSQiQxp).
BTW, I've not been in the TR camp for years now. My portfolio volatility is very low, but performance is still good. I'm not arguing about CDs or not; just offering another option. I understand that this thread started as a CD one, but why not discuss the next step, especially when there is not much to talk about CDs?

The best way of capitalism is to bring prices down. Apple does the opposite.
I feel the same about MSFT 365. I'm never paying them for this if I could, and why I use the free Libre Office.

mark: Oh man, the Dow must matter to someone otherwise why is it still a market marker after all these years? Also I'm not so sure there are any serious analysts but there are motivated ones.

There are other market markers but any time someone says THE MARKET it is the SP500 or VTI.

YBB:Correlation between DJIA and SP500 is 95%

Correlation still doesn't mean equal. Example: One year (as of 12/22/2024)...The Dow = 14.7%...VOO = 27.7% (https://schrts.co/gIHYNViK)
For 5 years: The SP500 doubled the Dow (https://schrts.co/INEenHhQ)

What OJ said!
4% guaranteed interest is our threshold vs bond OEFs. 5+% is pretty much nirvana.
We SOLD ALL bond OEFs when CP CDs reached these ^ levels and have not (yet) turned back. We have a 5-yr, CP CD ladder still yielding a wee bit over 5%.
With interest rates, all investors EVER know are the current rates and the current trends. About a year or so ago, CP CD rates were 5+% and the trend was DOWN.
So we loaded up on them at that time, avoiding the reasonably predictable dilemma faced by CD investors with currently maturing CDs.
Not saying we were right and they were wrong, just saying what our strategy was/is, and that it has worked out exceptionally well for us.

For my measly 10% cash position I ended up splitting it 50/50 between Fido’s SPAXX and JAAA.
Can’t get excited about cash, but understand the appeal to some. I’d have to have a much shorter life expectancy then I currently presume not to take a bit of risk in upper tier HY, convertibles, arbitrage, preferred, and short-intermediate duration IG corporates. I don’t like longer dated bonds. It’s not that I think they’re a bad investment. Just that unless you can tell me where rates will be a year or more out, it’s impossible to know what longer dated bonds’ prospects are. Becomes a question of: “Where would you rather assume some risk?”
A great discussion. You guys really get “into the weeds” splicing and dicing the different cash options.
Admirable.
BTW - In case you haven’t looked, the 10-Year spiked sharply again today, now above 4.58%.

Correlation between DJIA and SP500 is 95%. Of course, WSJ/Barron's/NWS and SPGI have interests in pushing DJIA.

I appreciate your interest in low stress places to put cash for 2-3 years. Different people have different objectives and that leads to different choices - as you said, that is okay.
2-3 year brokered CDs (callable) paying no more than 4.6%. A non-callable 2 year Treasury (coupon 4.25%) is expected to yield 4.3% at auction. In a taxable account, the Treasury note yields a similar amount after tax if your state has an income tax. And it comes without call risk.
Though the Treasury has reinvestment risk every six months on its coupon payment. OTOH, the CD has reinvestment risk on its principal if the CD is called. I find the former less stressful (not much cash is subject to reinvestment risk). You may feel differently - it's a matter of personal preference.
It is true that RPHIX did not return more than 4% before 2023. I suggest that a better way of looking at it is how much it outperformed cash. According to Portfolio Visualizer, it usually beat cash by 3/4% or more, with larger margins coming in years when cash returned under 2%. So it is not surprising that RPHIX has not exceeded 4% until recently. Cash has not exceeded 3% until recently.
Portfolio Visualizer comparing RPHIX and ^CASHUS.
The question becomes: what do you expect cash to do? You've answered that. You expect cash to be flat or drop slightly. (Not saying this is right or wrong - no one really knows - just restating your perspective.)
Cash (as represented by 3 mo T-bills) is currently (12/20/24) yielding 4.34%. Lop off another 1/2% (assume the Fed "aggressively" cuts rates), and we're looking at 3.8% next year. Conservatively, add 1/2% for the RPHIX yield. That comes to 4.3%. This is not the worst possible case, but a fair estimate of the worst reasonably possible case.
It looks like RPHIX won't do much worse than a CD and could do better. Should short term rates plummet beyond what I suggested above, then the CD will get called.
Either way, for me I find RPHIX less stressful. Fully liquid and no need for a plan B if the CD is called. You may not care much about those factors (i.e. they don't cause you stress) and find yield volatility vis a vis a CD stressful.
I just finished a 3 year electricity contract - no stress. I'm now on a 9 month contract - more stress. There's something to be said for locking in rates. Everyone is different, and each situation presents its own types of stress.
[CD rates from Schwab and Fidelity. Treasury expected yield from Fidelity.]

"10 consecutive days down"
The 24/7 media is always looking to make more than it is. The DOW was down 10 days.
Does any serious analyst look at the DOW? No, they watch the SP500.
When the DOW goes down over 1000 points, the media loves to say it was 4 digits down. mmm...what is 1000 points? less than 2.5%
Does 10 days matter? not so much, you got to look at much longer risk/reward.

Although this thread is about CDs, the bond oef RPHIX keeps getting mentioned as a viable alternative. I was a bond oef, momentum investor before I sold all my bond oefs in 2020. RPHIX produced a consistent TR of 1% to 3% almost every year before 2023. In 2023 and 2024, it had a TR of slightly over 5%. I invested in CDs during 2024 that made about the same as RPHIX. I still own a large number of CDs paying over 5%. As a previous bond oef investor, I do not believe RPHIX will make over 5% in 2025, but instead I expect it to have a TR in the 3 to 4% range. I can get that in 2025 wirh callable CDs with no stress, so I am not inclined to use RPHIX for my very conservative portfolio when CDs will produce comparable or better TR, with less risk. If I want a solid investment for the next 2 to 3 years of at least 4%, I will invest in a noncallable CD that pays 4%, not RPHIX with no history of making 4% except for 2023 and 2024. I am well aware that posters/investors who are opposed to CDs will likely not agree with me--that is okay!

"tariffs could add to the prices of imported goods"
While this is of course true, it's one of those boilerplate constructions that doesn't prompt one to think about the ordinary stuff used daily that has a large "imported" component. I'm thinking about that because I just read a report in The Guardian concerning Florida orange production. Here's an excerpt from that report:

"another hyperactive hurricane season, paired with the dogged persistence of an untreatable tree disease known as greening, has left a once thriving citrus industry on life support.
Only 12m boxes of oranges will have been produced in Florida by the end of this year... the lowest single-year yield in almost a century. The figure is 33% lower than a year ago, and less than 5% of the 2004 harvest of 242m boxes. It is also dwarfed by the 378m boxes expected to be produced this year in Brazil, the world’s largest grower and exporter of oranges."

So my morning glass of orange juice may be expected to cost 25% more in a few months if our new improved executive branch has it's way. How many other "everyday" products have a significant import component, and how much knowledge of or attention to detail does anyone expect our new improved executive branch to actually have?
And inflation is going to go down??

PAAA. Per it's last distributions, it's close to 4.7% on an annual basis
That's about right when one takes the last monthly distribution yield and compounds 12 times (12 months/year). The figure is as of the end of Nov (record date 11/29, ex date 12/2). FWIW, I get 4.706%.
Fidelity shows FSIXX having a compound annual yield of 4.61% as of the end of Nov.
After subtracting state taxes (say, 5.29% for GA in 2025), PAAA yields about 4.46%. The Treasury MMF seems the better choice for now: higher after (state) tax yield, underlying securities backed by the US Treasury, zero volatility (stable $1 price).
When rates start to go down, MM/CD/treasuries will be far behind
It matter what you mean by "rates". As the Van Eck piece you cited says: "Since the current rate cutting cycle began in September, long term yields have increased ... as of [10/31/2024]."
Intermediate term rates have also been increasing since September (as noted in my post above).
It's mainly short term rates that have declined since September. And with them, so have PAAA yields. PAAA's latest div is about 20% below that at the end of Aug or Sept, while its share price has risen slightly - meaning that the actual yield has dropped more than 20%.
In comparison, FSIXX's divs have dropped just 14% or so over the same span. PAAA's (after tax) yield seems to be getting left behind as short term rates have fallen.
All of this could change as the Fed takes a breather on lowering the fed funds rate. Especially if inflation doesn't come down further. Food and energy price declines may not materialize and tariffs could add to the prices of imported goods.

DT: I qualified for SNAXX in 2020 in my IRA account, when I met the $1 million investment requirements, but have to use SWVXX for my taxable holdings because I did not have enough money to qualify for SNAXX

Easy solution. In 2020+2022 I held MM at Schwab. I purchased SNAXX in 2020 in my rollover(=trad) IRA. Then I transferred one share from TIRA to Roth IRA and from Roth one share to my taxable.
I actually also bought at that time SUTXX+SCOXX and transferred to all accounts because when risk is very high, I like the safer options.
=============
The older I get and more money I have, the more conservation I get, but no CD/treasuries for me so far. I still use MM when risk is very high and I'm out of market.
CLOs had one of the best opportunities I have seen for years. I still in them heavily. Great performance with very low volatility. I looked at PAAA. Per it's last distributions, it's close to 4.7% on an annual basis.
CLOZ, one of the lower-rated CLOs, made over 20% in just 1.5 years.
Portfolio Managers John Kerschner, Nick Childs, and Jessica Shill discuss why they believe the strategic case for AAA CLOs remains compelling amid Federal Reserve (Fed) rate cuts.
(https://www.janushenderson.com/en-us/advisor/article/do-aaa-clos-still-make-sense-in-a-declining-rate-environment/)
Another CLOs link (https://www.vaneck.com/us/en/blogs/income-investing/why-clos-still-make-sense-when-the-fed-cuts-rates/)
RPHIX should be a no-brainer.
When rates start to go down, MM/CD/treasuries will be far behind.

alarm set for about 10 years
Now just 9½ years.
The public perception may have changed too about their fairness or unfairness.
It seems to me that it did, and in a rather curious way. Despite current antipathy toward "freeloading" government workers and government in general (there's a reason why Congress' pay raise was dropped from the CR), the unfair treatment of government workers was used effectively to garner support for eliminating WEP and GPO.
I find it interesting to compare the relative success (though it took years) in revoking these laws with the failed effort of Social Security notch babies to get more benefits for themselves. In both cases, it seemed that the loudest supporters of change were those who would directly benefit.
One difference is the size of the groups who stood to gain. Notch babies were just those workers born between 1917 and 1921. There are many more government workers. And they are still alive and apparently kicking.
Another difference is the matter of fairness. With WEP, most workers affected received less than their fair share of benefits. (Under WEP some high earners got more than their fair share, though less than they will receive now.) In contrast, all notch babies received more than their fair share; they just got less of a windfall than those born before 1917. That was their gripe.
https://www.washingtonpost.com/wp-srv/business/longterm/quinn/columns/030299.htm
Here's a paper with everything you wanted to know (and more) about the flaws in WEP and GPO and how two proposals could reduce (IMHO extinguish) inequities. TL; DR (19 page pdf).
https://www.ssa.gov/policy/docs/ssb/v79n3/v79n3p1.html (HTML format)
https://www.ssa.gov/policy/docs/ssb/v79n3/v79n3p1.pdf (pdf format)