@fred495...question if you are comfortable answering...how much of a change meaning your 100% Treasury MMKT and FDIC CD portfolio from your past portfolio...were you very heavy in those investments prior and if so what % of your portfolio?
FWIW...I've been 85-90% for many years in those types of investments....now ~ 95%...."stop playing the game if you feel you've got enough...don't get greedy...get your portfolio where you can sleep well at night" I'm still working and do I guess you would say better than average out there...working for the "fun of the game, camraderie and challenge.."
...who the heck knows though right?
Good Luck to ALL,
Baseball Fan

I am a retired and fairly conservative investor who really doesn't need a lot more money - but I certainly don't want to lose a lot. In the current environment, preserving capital is more important to me than seeking return on capital. I prefer to err on the side of caution. As you said, "who the heck knows"?
I have been 100% in a Treasury only MM fund and in FDIC insured CDs from large national banks since the early spring of last year. Currently, the split between Treasury MM and CDs is approx. 40/60. This percentage will change as CDs mature and the proceeds are reinvested in the future.
Prior to that I was approx. 50% in allocation/options/macro trading funds with fairly low standard deviations, such as FMSDX, JHQAX, BLNDX, PVCMX, etc., and the other 50% in bond funds, such as NVHAX, OSTIX, RCTIX, TSIIX, etc.
Good luck,
Fred

I just spoke to Schwab a few minutes ago about uninvested cash just sitting. I was told that it is swept into Schwab Bank and pays .45%. I would not mention this normally but right now I am concerned about all MONEY market accounts. My adult kid sold off a major position in Swvxx and so far is too lazy to move it to her synch OLS.

@hank,
Japanese Companies = yes
Japanese Economy = not so sure
Buffet's 5 Japanese stocks:
japanese-stocks-that-warren-buffett-just-bought
Japanese Funds/ETFs i have followed:
HJPNX
HJPSX
FJPNX
DXJ - great returns over the last 5 years

***Also posted on Big-Bang
I currently hold FXAIX (FIDO) and PRILX (Parnassus), taxable and ROTH, respectively.
I am looking to compliment each of them with another fund (Mutual or ETF). I currently also have a small position in TDVG (PRDGX-TRP) but not sure if it's the best complimentary LCB option.
I am having a little difficulty narrowing down an ETF or Mutual fund; a consideration is JQUA (JPMorgan Quality Factor). One issue I am coming across is tax efficiency; most of my DD is leading me to higher than desired Tax Cost Ratio Mutual funds and some ETF's with .7 - .8 TCR.
Not that .7 - .8 is terrible, but if I am to invest in an ETF, I would prefer a more tax efficient one, if possible. Maybe it's not viable for this category?
EDIT: Just came across a 1-year old ETF from Capital Group "CGUS" (combining Growth and Income....can serve as a compliment to the S&P 500....). Any thoughts on this?
I'm looking to invest about 10% in this "complimentary" MF and/or ETF
Any suggestions, constructive criticisms, thoughts or idea's are very welcome!
Thank you in advance!
Matt

I am starting this thread because I have more questions than answer when it comes to money creation. Econ 101 explains that "money creation" is what banks do with excess reserves and how banks can create $9 of debt (loaned money...known as a liability) from a single $1 of revenue (known as an asset or as a bank deposit).
From Econ 101:
The Banking System and Money Creation
From this reading, I then found data on US income tax payments (deposits (taxes) made to the IRS).
Federal_tax_revenue_by_state
Let's consider the Federal Reserve and the IRS as one big bank. In 2019, the IRS collected $3.56 Trillion dollars in tax revenue. This was collected from earned and unearned income (taxes owed by US citizens). On the liability side of this bank, US citizens are running a debt (issued by the US government) of 31.8 Trillion dollars.
https://usdebtclock.org/
In the banking world (fraction reserve system),
Assets + Liabilities = Total Deposits
So,
US Tax revenue ($3.56T) + US Debt ($31.8T) = $35.36T
Using the same numbers we can determine that 10% reserves equals $3.536T which is slightly less than the $3.56T collected in tax revenue (IRS assets). This would make a bank's accountant department happy. ;)
If this Fractional Reserve system is how banks operate (10% bank deposits & 90% bank loans), it appears the US government (Bank of USA) operates in a similar manner, collecting about 10% in revenues (taxes) and loaning out 90% in debt (liabilities).
Now, if we all can agree that the US national debt is "loaned out" and that it will create new tax revenues for years to come and so long as we are collecting at least 10% of "total deposits" in tax revenue each year we should be as solvent as the banking system...
O.K., now I see the problem! :(

#5 @Sven did you happen to see 60 Minutes last night ? Over charging for tools that the armed forces use !! All at tax payer expense ! Armed services hurt to : 100 tanks ordered , can only buy 90 with their allotted dollars.

Good interview overall with many historical perspectives. He is quite bearish and the economy is entering a recession now.
1. He likes things that you need, i.e. consumer staples (food), utilities, and healthcare, not so much things you want.
2. Long and short tern treasury bonds as in a barbell
3. Gold, but they are near all time high
4. Farmland (impractical for most investors)
5. Defense industries as the budget goes up every year
6. His equity allocation is at all time low (recession)

@dtconroe what makes a banking account (checking and savings) more liquid than a money market fund at the likes of Schwab?

Hi Mona, I have a brick and mortar branch of my bank 10 minutes away. I literally can get whatever cash I need out of that bank within just a few minutes. If the bank is closed, I have a drive through ATM 5 minutes away where I can get cash. I can move money between my checking account and savings accout online, instantly. I have FDIC protections and I have tremendous trust in my bank as a result of many years of membership. I also have a large number of bills linked to my bank account online, for monthly drafting to pay the expenses. I also have a large number of ongoing deposits from social security, spouse pensions, etc. and if any of those are disrupted by Default problems, then I have other cash available in my bank savings account that I can quickly shift to my checking account for bill drafting coverage.
With my Schwab brokerage MM account, I have to put in a trade to sell a certain amount of the MM fund, and it goes to brokerage cash the next day. Then I have to transfer the brokerage cash electronically to my bank, and it takes a couple of days for the trade to settle and the transfer to be completed. Sometimes the weekend delays the process for a few more days. When the money finally arrives at my bank, then I can go through the withdrawal, bill paying process, that I already described.
From my perspective, everything is faster and more dependable by have adequate assets in my banking account, and quite frankly I trust my bank more than my Schwab brokerage to protect my cash.

I sold all of my bond funds in March of 2022. I have not bought any new bond funds since then, preferring Brokerage noncallable CDs and MMs. I have no plans on buying any new bond funds in the near future. For now, I prefer to reinvest CDs that are maturing, into new CDs at higher interest rates. I continue to hold a large number of watchlists of bond oefs, to see if there is an emerging performance pattern that interests me, but nothing I trust has emerged in 2023 so far. I continue to have interest in Bank Loans, Municipal Funds, and some HY, Multisector and Nontraditional funds, so I watch those most closely. With MMs and CDs paying aroung 5% or more, I have no sense of urgency to rush back into bond oefs.

At this time, and for lack of any better alternatives that meet my comfort level, I am keeping 100% of my portfolio in a Treasury Only MM fund and in FDIC insured CDs issued by the largest national banks until the proverbial dust settles.
Good luck,
Fred

Hi Fred, I am not sure what kind of portfolio you have. I have both a traditional taxable account, along with an IRA account. I am keeping my Brokerage IRA portion in MMs and CDs, but I am transferring "part" of my traditional brokerage taxable account to my Banking Account (checking and Savings) for liquidity reasons. Do you count your Banking Account as part of your portfolio?

@fred495...question if you are comfortable answering...how much of a change meaning your 100% Treasury MMKT and FDIC CD portfolio from your past portfolio...were you very heavy in those investments prior and if so what % of your portfolio?
FWIW...I've been 85-90% for many years in those types of investments....now ~ 95%...."stop playing the game if you feel you've got enough...don't get greedy...get your portfolio where you can sleep well at night" I'm still working and do I guess you would say better than average out there...working for the "fun of the game, camraderie and challenge.."
Have to say, my current thinking is you might be "safer?" in AAPL as due to a better balance sheet than the govt (no printing press though) as it is a utility without the interest rate exposure of a normal utility and has plenty of "fan boys/girls/others" who are addicted to their products...maybe BRK-B too but I saw during the Pandemic ole'Warren kinda froze up a bit, he seemed really rattled for someone who has had many trips around the sun...
I've been adding to FPACX...nice cash buffer in portfolio, thinking Romick and the boys will know what to do AND act at the somewhat correct time...heard on recent podcasts that the "technicals" are looking better, throwing off buy signals...who the heck knows though right?
Good Luck to ALL,
Baseball Fan

The Week in Charts (05/20/23)
A tour of the markets covering the most important charts & themes, including the Nasdaq 100 comeback, the inverse of 2022, US equity valuations, the US Consumer pullback, and more.
Video
Blog

The way brokerages service cash accounts (variously called "transaction accounts", "core accounts", etc.) is confusing by design. Sweeps happen automagically (pay no attention to the man behind the curtain), and investors are not supposed to concern themselves with details.
Those details vary from brokerage to brokerage but are generally similar. A brokerage transaction account is used to pay for investment purchases and to hold proceeds from sales, interest and dividend payments.
Investors typically have a choice of places where this cash may be kept. One option is a bank sweep. Brokerages use one or more banks (called "Program Banks") to hold the cash of investors choosing this option. Even though you get FDIC insurance "passed through" to you from the banks, you don't actually have a bank account at any program bank. Rather, the brokerage aggregates all the cash together and has a single bank account at each program bank for this purpose.
If brokerages own banks, they generally use those banks as their program banks. So Merrill uses BofA. Schwab uses Charles Schwab Bank, Charles Schwab Premier Bank, Charles Schwab Trust Bank, TD Bank, and TD USA Bank. The latter two are not affiliated with Schwab. (Their use might just be legacy from when TD Bank owned TD Ameritrade; just speculating about status.)
For checkwriting services, Schwab encourages you to open (and link) a Schwab bank account. It provides a combined application for a brokerage and a bank account. It provides combined reports (see OJ's image above). But the basic brokerage application (w/o Schwab Bank) also allows you to request checks & debit card (see section 5).
Checkingwriting services are spelled out a little better for Schwab IRA brokerage accounts. Here's the IRA checkwriting disclosure. These checks are processed by BNY Mellon. So it is clear that for IRA checkwriting at least, you don't need to link to a Schwab Bank checking account.
Aside from bank sweeps, the other main option at Schwab is Schwab One® Interest Feature (you're loaning the cash to Schwab; it gets SIPC protection). Some investors (employer plans, advised accounts) may also be able to use sweep shares of a MMF SWGXX.
See also:
https://www.schwab.com/legal/cash-features-disclosure-statement
https://www.schwab.com/legal/schwab-brokerage-account-agreement

Several Matthews Asia funds were mentioned.
I personally would stay away from all Matthews Asia funds in the near-term (possibly long-term).
There has been an exodus of talent at the firm over the past few years.
https://www.mutualfundobserver.com/discuss/discussion/comment/152046
https://www.mutualfundobserver.com/discuss/discussion/comment/156101
https://www.mutualfundobserver.com/discuss/discussion/comment/159415

I agree.
@randynevin. Look at DODWX. It is global, not strictly international. Great track record.
https://www.morningstar.com/funds/xnas/dodwx/quote

Not really- there are two separate entries there:
• The first shows "Cash and Cash Investments Total $54,014.50"
And down in the extreme lower right of the "Balance Details" section:
• "Funds in linked Bank Account $10,046.00"
And that is agreement with the Account Summary as shown above. The only account we have at the Schwab Bank is a checking account. I'm not sure if that's the same on your side, or if that actually makes any difference at all. This whole thing with the apparent differences in our accounts is very puzzling to me.

19 May, 2022.
https://www.bloomberg.com/news/videos/2023-05-20/wall-street-week-full-show-05-19-2023
GULP! The national debt is now up to 97% of GDP!? (Remember when the figure was tagged as GNP? So, what's the difference, and why the change?)

Recessions & financial crises go hand in hand after Federal Reserve tightening cycles. Outspoken economist Dave Rosen-"bear"-g sees evidence of both and advises defensive investments.
He's predicting 3100 on the S&P 500.
Previous lows:
Present Level = 4192
1 year low - Oct 10, 22 = 3500
3 year low - Mar 11, 2020 = 2586
5 year low - Dec 1, 2018 = 2506

Anybody care to speculate on what caused BAMBX to fall to earth after several great years? From 2016 through 2021 it was positive every year - delivering (by my estimate) around 5% yearly returns on average. That type performance from a low / moderate risk fund is going to attract eyeballs. But it fell 3% in 2022 and is dead-even (0%) YTD.
OK - 2022 was reasonable considering the whacking both equities and fixed income received, But this year makes no sense. All I can figure is that it’s invested heavily at the short end of the yield curve and has struggled against sharply rising short term rates. If that’s the case, it stands to do much better when short-term rates begin falling. Just a guess. Anybody see anything different?
“Black box” is probably a misnomer. Yet, ISTM this type of investment process makes it a real challenge to “get under the hood” and really understand what makes the fund behave the way it does.

@sfnative-
It's entirely possible that I'm ignorant of some things here. I have no idea what a "Program Bank" is, nor have I ever seen anything on Schwab referring to that. If I visit our "Account Summary" there are two separate entries for cash accounts- one for the brokerage and one for the bank.
Here's a reproduction of the top lines of our current Account Summary:

Note that the brokerage cash account is currently $54,014 (a CD just matured), while the bank account is $10,046.
I really don't know what else to say about this.
Regards- OJ