By the way, last week I bought a 2-yr CD with call-protection (4.7%) from Morgan Stanley. CDs are getting more rewarding now. When they reach 5-6%, they become more attractive than stocks and bonds in coming years.
Also treasuries are catching up to the CD yield. One year treasury is yielding 4.72% as of Wednesday evening. The 3 mo, 6 mo and 9 mo Treasuries are higher than the CDs of the same duration.

Bought CD today from Schwab: Morgan-Chase | 4.85 | 2/22/24 | FDIC | Callable.
Will keep checking every few days to capture steadily higher rates. Go Fed!

https://www.sec.gov/Archives/edgar/data/826732/000110465922113963/a22-29340_1497.htm
497 1 a22-29340_1497.htm 497
CALAMOS INVESTMENT TRUST (the “Trust”)
Calamos Global Sustainable Equities Fund (the “Fund”)
Supplement dated November 2, 2022 to the
CALAMOS® FAMILY OF FUNDS
Prospectus dated March 1, 2022
On October 31, 2022, the Trust’s Board of Trustees approved a proposal to liquidate the Fund. As of the date hereof, it is expected that the Fund will be liquidated in the first quarter of 2023.
The Fund will further supplement its prospectus with information regarding the timing of the liquidation, including the date on which the Fund will close to new investors and the date on which it will close to investments from current investors.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE

@sma3 This seems to be the explanation FARIX provided in its regulatory documents:
https://sec.gov/Archives/edgar/data/1261788/000114554922056117/ncen-fulcrum.h
Is that what you received? I am not very familiar with this fund, but it is a statement from the fund's accountants, BBD, LLP:

As of June 30, 2022, we noted that controls over the Fund’s valuation of forward exchange contracts were not operating effectively and as a result the fair value of one contract was incorrect resulting in a material misstatement of the Fund’s net assets. Management of the Fund has reviewed the processes and controls that gave rise to the deficiency, and as a result, has implemented changes that management believes will allow for the prevention and/or timely detection of similar deficiencies on a prospective basis. These conditions were considered in determining the nature, timing, and extent of the procedures performed in our audit of the financial statements of the Fund as of and for the year ended June 30, 2022, and this report does not affect our report thereon dated September 1, 2022.

I do think this is a different situation from the one I'm describing from the sound of it, although the period the misstatement occurred was a volatile one.

@LewisBraham
What I find inexplicable is the timing.
I understand that on July 15th the rarely sold securities in FARIX were "estimated" to be worth X by their valuation firm. This allowed them to price the fund at $9.20.
OK, But then what happened between then and September 22?
IF they sold lots of this "estimated" junk, when they sold it what it was worth, as it was marked to a market price..
( Why did it take till September 22 for them to "find" another price that they retroactively applied to the NAV on July 15?)
If it was not sold on July 15th, but many months later, how can you apply a "mark to market price" in September to a NAV in July?
I think a better explanation is there were lots of redemptions, and they paid them out, but when they finally unloaded some of this stuff, they didn't make the cash they wanted, so they went back and "Adjusted" the prices to allow them to be whole, not their investors.

@yogibb, the 10 Year-3 Month Treasury Yield Spread is the difference between the 10 year treasury rate and the 3 month treasury rate. This spread is widely used as a gauge to study the yield curve. A 10 year-3 month treasury spread that approaches 0 signifies a "flattening" yield curve. Furthermore, a negative 10 year-3 month spread has historically been viewed as a precursor or predictor of a recessionary period. The New York Fed uses the rate in a model to predict recessions 2 to 6 quarters ahead.
10 Year-3 Month Treasury Yield Spread is at -0.16%, compared to -0.12% the previous market day and 1.53% last year. This is lower than the long term average of 1.20%.
https://ycharts.com/indicators/10_year_3_month_treasury_spread
The indicator went negative in late October. Think it is too early to say anything.
@sma3, we are living in strange time when many events are coming together (war, pandemic and remote working) and they all contribute in their own way to inflation. The challenge is that it doesn’t seem to respond well to rate hikes.
I maintain a balanced allocation while paying particular attention to risk reduction. Sold most of growth stocks, EM and developed market stocks. Still I keep a healthy cash position (CDs and treasuries), and exposure to energy, and commodity futures. Just as I am building up alternatives they are falling.

Having a security valued at $10 by an outside pricing service even though the manager senses that price is stale and the security could only fetch $8 if he had to sell it in a falling market I would suspect creates plausible deniability from a legal perspective. There is also a legitimate question as to what the security is "worth" from a sense of intrinsic value versus what you could get for it price-wise during panic selling and a liquidity crunch. Let's say you have such panic selling of all stocks and bonds, but you own the bond of an issuer that still has a viable business and can pay the debt's interest and principal on time. You might be only able to get 80 cents on the dollar of the face value of the bond if redemptions force you to sell the bond during a panic. Yet the bond in a normal environment could be judged worth full face value. So, you can claim in a court that even though you ended up selling it at a 20% discount due to redemptions, you and the pricing service were correct in pricing it at its full par value right before you sold it. Still, I suspect mfs might have a better answer for this than me.
I suspect the most viable cases for pursuing legal action involve actual credit impairment of the issuer which the manager or the pricing service declines to acknowledge in the valuation of the security. If the manager knows an issuer is heading towards default yet continues to value the security at par, that's a big no-no. That's why I believe the Heartland muni bond fund case was a slam dunk for the SEC. From MFS's linked article:

In 2008, Heartland Advisors agreed to pay $3.5 million to settle an SEC lawsuit over the drastic markdown of two municipal bond funds in 2000. The SEC said the investment firm was negligent in failing to properly price the value of some bonds in the Short Duration High-Yield Municipal Fund and the High-Yield Municipal Fund. The funds had invested mainly in nonrated medium- and lower-quality municipal bonds. When the projects underlying some bonds held by the funds went into default and other projects were failing, Heartland didn't make sure the funds were priced accurately, the SEC asserted.

Notes from above & Fed Chair Powell’s Press Conference
Fed fund rate hike by +75 bps to 3.75-4.00%. Bank reserves interest rate 3.9%. Primary credit rate 4%. More hikes are coming until the Fed sees slowdown in economic activity from the financial conditions tightening (but there is no numerical targe for a terminal rate). Inflation-expectations have stopped going up. The Fed watches core PCE and 3mo-18mo yield spread (media watches a variety of yield spreads). Over-tightening is preferable to under-tightening (or a premature pause); reason is that it is easier to fix over-tightening.
QT continues at -$95 billion/mo (-$60 billion/mo for Treasuries, -35 billion/mo for MBS).
Labor and job markets, and wage growth remain very strong. Consumer spending is robust. Housing is regional but isn't hot anymore.
The Fed is aware of global concerns and regularly consults with other central bankers. But the Fed focus is on the US.
US soft-landing is still possible but is becoming less likely due to persistence of inflation.
Impacts of fiscal spending are mixed.
Ethics issues at the Fed are being addressed with stronger disclosure rules and other restrictions.
I had a dentist appointment, so this is a delayed report.
https://ybbpersonalfinance.proboards.com/thread/158/fomc-statements-6-7-weeks?page=2&scrollTo=823

@sven
It depends on your views of inflation. At 70, while I was not investing at the time, I am old enough to remember "Stagflation" in the late 70's and 80's. My wife and I thought we had it made in "Dreyfus Liquid Assets fund" that paid 14% (?). We didn't realize Treasuries paid 15% and if we had bought them we could have held them for 30 years.
Anyway, if you think this will be an ordinary recession/ deflationary scenario then buy long term bonds.
IF you think inflation is currently being driven by many external factors (ie war, Russia, etc) and the Fed will be unable to control it, would stay in short term bonds and cash and even in oil and commodities.
Personally, I am still largely in cash and short term bonds, but buying some ten year Munis and Treasuries in case interest rates do drop.
I am overweight in Energy and Commodities especially agriculture ( DBA and MOO ). Longer term I expect rare minerals and stuff used in electric vehicles and clean energy will do very well. Most of these stocks have crashed along with all the other high PE stuff, but they may bounce back quicker than AMZN, MSFT and of META

@derf
You read what I meant correctly the first time.
Twice I have had a mutual fund company several months later change the price at which I sold their fund, to their advantage I might add.
In 2016 I sold MBXIX in two of our accounts at one price, only to have Schwab and Fidelity later change the price, resulting in less money to us.
Most recently I sold FARIX in both my and my wife's retirement accounts for $9.20 a share on July 15 2022, only to have both Schwab and Fidelity change the price to $9.14 on September 22,2022. They canceled the first trade and put in another at the lower price, resulting in $300 fewer dollars to us.
Schwab was nice enough to send a letter. Fidelity never notified us. I called Schwab and they said that if a mutual fund company tells them a previous price was inaccurate, they accept that number and follow thru, changing the trade.
I posted about the MBXIX when it happened, and have never wanted to do business with Catalyst again. I emailed them but never got a reply. I think I even emailed the SEC.
I assume the change was for the reasons stated above, ie thinly traded securities, but it is amazing that the SEC lets companies do this, rather than making them eat the difference.
Given these examples, and the IOXIX example and IOFIX disaster a year or so ago, I am very leery of investing large sums in funds using "thinly traded" securities.
Of course, with the very broad mandates most funds have now, you hardly know what many mangers are buying.
If anybody else has had this problem, I would like to hear about it. Maybe if enough people complain something will be done

The difficulty is in accurately price securities. Securities don't have to be exotic to be illiquid and thus difficult to price. As Lewis later wrote, "The problem is many bonds and debt securities don't trade every day."
Not that long ago (early 2021) we saw a similar problem with IQDAX. As @hank quoted from the WSJ then:

“(The) firm unexpectedly halted redemptions in February and said it couldn’t value its holdings. The move stunned market participants, some of whom viewed their investments in the fund as a hedge to their broader portfolios. Infinity held wide-ranging bets across stock, currency and derivatives markets, including over-the-counter positions … Infinity appeared to have misvalued its large derivatives portfolio. Some of the valuations it disclosed were too high and, in one instance, mathematically impossible.”

https://mutualfundobserver.com/discuss/discussion/comment/146295/#Comment_146295
The fund had manipulated a third party pricing algorithm. Presumably that was to make the fund look better; I don't imagine the tweaking was done to make it look worse.
I wonder how much of this sort of mispricing is due to ineptness, and how much is deliberate.
My contribution to that thread was to refer back to Heartland, which grossly (44% and 70%) mispriced HY muni bonds two decades ago. Munis, even junk, are not derivatives, and not something I'd consider esoteric (are Puerto Rican bonds "esoteric"?). Not esoteric, but still some are thinly traded and difficult to price.
Regarding munis, see also WSJ, Mutual Funds' Muni-Debt Prices Are Questioned, Feb 18, 2011. No great surprise that it mentions the highly volatile Oppenheimer Rochester funds (now owned by Invesco). "Scrutiny of junk muni-bond values by the SEC includes "tobacco bonds". That article also talks about deliberate mispricing.
The specific funds change, the practices remain.

I have attempted to construct a portfolio with both funds and single stocks which will withstand a recession without making me lose sleep. I remember '08-'09 vividly. I was still pouring $$$ into my 403b (self-directed!) through that hot mess. But it wasn't in stocks, it was in EM bonds. NO MORE of that. The time was right for it back then.
I've no doubt there will be a recession. I'm going to continue to grow my portfolio, not pull back. I'm too heavy in Financials and will reduce that sector in the portfolio after the New Year. But that would have been true, no matter what. PRISX. (corrected.)
Half of my bonds are in Junk. Total in bonds is 25%. My priority is on the divs, not share price. TUHYX. The other half is in balanced funds: PRWCX and BRUFX.
If losses are inevitable in a recession, I'm prepared. Particularly after the GFC and... THIS year has smelled a lot like old garbage, too, but with a few respites.
Favorites, (in addition to PRWCX, of course:) BHB ET PRFDX .

And now for a potential China "bull case"...
The following excerpt is from the 'Points of Return' newsletter (John Authers) published today.
That leads to a final question: Why would anyone be bullish about China at present? Its problems are evident, and most international investors will justifiably hate the current political direction. Andy Rothman, investment strategist and veteran China-watcher at Matthews Asia, agrees that watching for progress on Covid Zero, and particularly for a pickup in vaccination rates, which have been falling, is most important. Providing the country can find a way out of lockdowns, he offers the following “bull case” for 2023:
China is likely to remain the only major economy engaged in serious easing, while much of the world is tightening.
Chinese households have been in savings mode since the start of the pandemic, with family bank account balances up 42% from the beginning of 2020.
Those funds should fuel a consumer rebound, and an A-share recovery, as domestic investors hold about 95% of that market.

It's certainly a good short-term investment, but a lot depends on whether or not we enter a recession to make it a good long-term one. If the CPI goes down instead of up, it's dead money paying nothing. But in the short-term, it's hard not to like 6.5% with no downside risk for those who bought before October 28.

For Terrsa: I found TBO capital website last June. Their healthcare fund looked good for me, also as their “fake “ team in LinkedLn. I opened account and made 4 wire deposits during next 4 month in total of $55k to HMC trading LLC (website provided wire instructions for HMC TRADING but not for TBO capital - that was a red flag but I wanted to believe that it was real good income opportunity)…last deposit was made in September, they sent me 3 checks with dividends ,all payable). That’s why I trusted them and kept doing additional deposits. On October 4th I tried to open website and check October dividends and found that website is off as well as contact emails and also their phones. That moment I understood that I was robbed and sameday I sent my complaint. to SEC, FBI cybercrime division, FINRA and WELLS FARGO wire claim dep.

That fixed/base rate is low at 0.40%, IMO. The 5-yr TIPS/real rate is 1.60%. The 5-yr TIPS looking a better deal (next auction 12/22/22; buy anytime in the secondary market).

TIAA Traditional Rates, November 1, 2022
Restricted RC 6.50%, RA 6.25%
Flexible RCP 5.75%, SRA 5.50%, Newer IRAs 3.65%
#TIAA #TIAATraditional #StableValue #GuaranteedIncome #403b
https://ybbpersonalfinance.proboards.com/thread/142/tiaa-traditional-rates-monthly?page=2&scrollTo=820
TSP G Fund hasn't updated yet for 11/2022 (10/2022 rate was 4.00%).
https://www.tspfolio.com/tspgfundinterestrate

I have long wondered if there is any good poetry about Wall Street. Geritz's poem here, by her own admission, doesn't quite cut it. Here's one allegedly by Edgar Allan Poe:
Epigram for Wall Street
I'll tell you a plan for gaining wealth,
Better than banking, trade or leases —
Take a bank note and fold it up,
And then you will find your money in creases!
This wonderful plan, without danger or loss,
Keeps your cash in your hands, where nothing can trouble it;
And every time that you fold it across,
'Tis as plain as the light of the day that you double it!
Here's another by a poet named Lola Ridge:
Wall Street at Night
Long vast shapes... cooled and flushed through with darkness...
Lidless windows
Glazed with a flashy luster
From some little pert café chirping up like a sparrow.
And down among iron guts
Piled silver
Throwing gray spatter of light... pale without heat...
Like the pallor of dead bodies.

Double whammy with Halloween and Presidential Cycle Indicators to buy:
Why The Halloween Indicator May Work For Investors In 2022 here
Halloween Investment Strategy Recent Results here

Well, that will be a way to avoid the transaction fee at the fund supermarkets. John Montgomery, the head honcho, has always refused to play the fee game with the big boys. In the days of physical annual reports, Bridgeway mailed plain old 8.5"X11" white printer paper. No glossy copy and generally a very honest report of hits and misses.