I am also in a quandary. I don't see Covid disappearing and I think it will cause at the best a "W" recovery. While these extremely low interest rates do sorta justify the sky high PEs we are seeing, I am always leary putting more money into equities when valuations are stretched like this. We ( SP500) are at tops not seen since the dot.com bust ( But back then the 10 year treasury was yielding what 5%?)
The additional disaster is the basement low bond yields. The country might keep chugging along without inflation, but to believe this I think you have to assume there will be no economic recovery.
At some point, either covoid will be controlled, the market will blast off and inflation with it, and bonds crater, or covid will continue the economy sputter, bankruptcies take off and the market crash.
Thus you can either assume the worse and get a capital gain out of your Treasuries, or party on and hope American Ingenuity will beat Covid, convincingly.
I am light on equities but don't see bonds as providing the ballast they used to and am stuck in cash.
i have bought small amounts of blue chip dividend stocks, esp Health care, consumer staples etc staying away from REITS and Utilities, hoping to add more when the market tanks
If I felt comfortable with options I could follow some of the strategies to profit in both scenarios without risking the nest egg.

Hi Skeeter,
1. The next dip will be fast. I think it will work, but be quick because the dip-watchers will be buying. Have a plan now.
2. Will work if, as you say, things go as planned.
3. Real estate is a no go for me. Also think bankruptcies and defaults ..... it's too early yet.
4. How bad do you want to invest? Please be an American. More is always better. Planes, tanks, ships, missiles......haven't you learned that yet? lol......
5. CFIAX - is not something I would add to value and low quality bonds. Why is the market going to change soon to make this good? Also, has no cash in my opinion. INPAX would be a better choice, just me saying. Better quality.....it's what you want with what's coming. You, the one with so many funds.....why buy now? You're being a Robin Hood-er, bro'.
XXXXXXXXX ......uh, that was the Dukester. I can't get a cold one without his causing a problem. What did he say?
You're dealing with an ocean of money. Wherever you go, it's been bought already. So his advice is to get some good whiskey .... the sipping stuff..... and relax for awhile. It's not time yet for this. The Brown One ......if he weren't a dog, the things he might do.
God bless
the Pudd

https://www.forbes.com/sites/michaelfoster/2020/08/22/a-tax-free-5-dividend-set-to-soar-this-fall/#51c217dc5e47
A Tax-Free 5% Dividend Set To Soar This Fall
Have you read the latest? The media says municipal bonds, our favorite plays for safe, tax-free dividends, are facing a surge in defaults
Mub have been on a tear recently last 4 5 months...w divs and good prices what else can go wrong?

Futures and options. Well, not for me, but.........you probably don't have any of these in your portfolio:
WEEK/YTD AUG 22
--- LTPZ = +1.9% / + 22% (UST, long duration TIPs bonds
--- TLT = +1.9% /+23.8% (20+ Yr UST Bond
--- EDV = +2.5% / +31.6% (UST Vanguard extended duration bonds)
--- ZROZ = +2.8 /+33.5% (UST., AAA, long duration zero coupon bonds)
WARNING: Hot potato area of bonds.

Last week's title was:

Bonds not getting any love right now

AAA bonds found some "lovers" this past week. For a week compare, if you choose; review the week return at the start of this thread and compare to the below returns.
Well, we investors have the "FED kick" still in place from March, and may invest, with this in mind, where one feels comfortable. At least relative to U.S. investment sectors, hopefully your positions are still seeing profits.
--- From March: The Federal Reserve kick-started the rebound into risk assets by pledging $3 trillion in unprecedented monetary support, going so far as to buy corporate bonds. That led to many investors repeating the mantra: "Don't fight the Fed" as they swooped in to follow the central bank's lead.
Those tiny, tiny yield numbers. Tis is easy enough to read in print or view on the tv screen those yield numbers. However, even in a weeks time; the yield numbers may reflect large percent moves. This past week wouldn't seem like much in the 10 year Treasury yield, being .71% on Aug. 14 (near term high) and at .64% on Aug. 21, so if one glanced on the 14th and again on the 21st and kinda forgot about the numbers; you need to keep in mind that the change is almost a 10% change. If this number were a SP500 number, it would be the news of the week. Now, this 10% change is not fully reflected into performance changes for AAA bonds; but is reflected into a positive direction for price performance, which is where the money is made.
Overview: AAA, safe haven bonds appeared to be more in line with normal performance and movement when investors become a bit twitchy with other market sectors (being overbought/too expensive ???) Do I know if this will persist ???? .......NOPE. Not unlike you, I can only watch price movements and attempt to discover the mood of the equity(s) markets and how this becomes reflected towards AAA bonds. The below is an OMG for those who ponder and wonder about the world of bonds relative to safe havens and/or market expectations from the big players.
4 days ago - Germany's longest-maturity bonds saw demand rise to an all-time high as investors seeking alternatives to dollar assets bought the nation's highest-yield notes. Bids for the nation's 30-year notes outstripped supply by 2.9 times, the highest since at least 1997, according to data compiled by Bloomberg.

Personal note: the yield on this 30 year bund was at -.05% at the time of the auction.

I should have previously included performance for AGG, as a gauge, which is now included in the below list.
The AGG, formerly known as the Bloomberg Barclays Aggregate Bond Index, is an index used by bond traders, mutual funds, and ETFs as a benchmark to measure their relative performance. The index is broadly considered to be the best total market bond index, as it is used by more than 90% of investors in the United States.
Currently, I glance at data for , but do not track muni's, mortgage or foreign bonds.
A few data views from bondland, for mostly AAA rated bonds:
AUGUST 21 WEEK / YTD
--- AGG = +.4% / +7.1% (widely used bond benchmark)
--- MINT = + .03% / +1.23% (Pimco Enhanced short maturity, AAA-BBB rated)
--- SHY = + .01% / +2.96% (UST 1-3 yr bills)
--- IEI = + .16% /+7.1% (UST 3-7 yr notes/bonds)
--- IEF = +.6% /+11.6% (UST 7-10 yr bonds)
--- TIP = +.6% / +8.7% (UST Tips, 3-10 yrs duration, some 20+ yr duration)
--- LTPZ = +1.9% / + 22% (UST, long duration TIPs bonds
--- TLT = +1.9% /+23.8% (20+ Yr UST Bond
--- EDV = +2.5% / +31.6% (UST Vanguard extended duration bonds)
--- ZROZ = +2.8 /+33.5% (UST., AAA, long duration zero coupon bonds)
***Other, for reference, not AAA rated:
--- HYG = +.8 / -.7% (high yield bonds, proxy ETF)
--- LQD = +.8% / +8.5% (corp. bonds, various quality)
Well, enjoy and be careful.
Regards,
Catch

Here you go! You need to scroll down a little.
https://fintel.io/doc/sec-ryjux-inverse-government-long-bond-strategy-fund-497-2020-may-19-18402-652

Just from observing the net asset values, it appears the Rydex Inverse Government Long Bond fund (RYJUX) executed a 1 for 5 reverse share split. But I haven't been able to confirm that. Does anyone have a web page link that confirms it? Thx!

In looking at stocks. Pulling data form a couple of my barometer feeds I'm finding that the blended P/E Ratio for the S&P 500 Index computes to 26.1 along with it's yield being found at 1.76%. For me, this indicates that stock valuations are streached by some of the metrics that my late father used and scores stocks as overbought.
In looking at bonds. I'm finding that the yield on the US10T is 0.64%. I'm wondering what folks are thinking? That is better than what my money market funds are paying but it is still very low by historical standards. By my late father's standards this indicates that US Treasuries are extremely overbought.
With the above in mind I'm wondering where investors are putting new money to work? For me, I have increased the allocation I have in my income funds from 40% to 45%. My income sleeve has a yield of 4.23% and my hybrid income sleeve has a yield of 3.58%. Within my asset allocation model I am aleady overweight my income area by +5% so no more room to expand there.
This leaves 15% of my cash in low to no yield places such as money market mutal funds and cash savings. My highest paying money market mutual fund PCOXX has paid out a measley yield of 0.53%. Carry this out and for the full years it projects to a yield of less than one percent.
With this, I ponder ... What to do in my quest for better returns with some of my cash as it builds?
Option 1) Sit tight and build cash while I await the next stock market dip (or pull back) where I can put an equity special investment position (spiff) into play. Generally, in the past, I'd look to make at least five percent off my spiffs when engaged. For me, this will work.
Option 2) I can buy more of my commodity strategy fund (BCSAX) which has a yield of better than 2% and as inflation rises usually the price of commodities rise. This fund holds some gold and gold mining stocks as well. It should do well if the US Dollar continues to decline and the price of commodities rise. For me, this will work.
Option 3) I can buy more of my real estate income fund (FRINX). As the US Dollar declines generally real estate values increase plus long term this would act as a hedge against inflation. Woops already have a full allocation to real estate and high yield securites. No go here.
Option 4) Buy more of my convertible (FISCX) and preffered (PFANX) securities funds. Hold up ... already have a full allocation there.
Option 5) Buy more in my asset allocation funds and let my fund managers find opportunity. This would also work because it would spread the funds's asset mix among those I'm already invested in thus maintaining my asset allocation. Two funds that I'm thinking of are CFIAX & INPAX.
So, for me, going forward, over the near term, it looks like my better choices are numbers 1, 2, & 5 of the options I covered.
I am also wondering what you might have thought of and where you might be positioning new money in this low yield environment?
Thanks for stopping by and reading.
Take care ... be safe ... and, I wish all "Good Investing."
I am ... Old_Skeet

Hi Skeeter,
Yeah, have looked up SPECX. Looks like a good fund. Will add it to my watch list.
As far as mid caps....... have been selling them. Down to three funds. Small and mid caps worry me right now. I think things will get worse this fall and winter, so I don't want to own them. I did buy AMFFX....a small watch position. It's the only value fund I own and I'm in no hurry to add.
As for selling, I sold FEFQX. It was the last tech fund I bought. It had 33% cash, so I got in. Now it has 6% cash. I made good money in a short time period. The fund has a lot of mid tech in it and is way overpriced, I feel. So just took some profits for now.
I like your thinking this market is way overpriced. I have 17 funds in the portfolio at or nearly at 52-week highs. Have never seen anything like that before. So it would not surprise me to see a pullback. And everybody is going to buy it quickly so I don't think it will last long.
My biggest fear is evictions and bankruptcies. They're coming like a slow-motion train wreck. It's going to take a while but it's coming. I know I'm repeating this but it worries me.
Also, told the Dukester you think he's smart. Now he's walking around like he's all that....lol. That's Brown for ya.
God bless
the Pudd
p.s. I'm drinking a longneck now.....

Regarding debit/credit card rewards, Amex has beefed up its traditional Shop Small incentive. If you register your Amex card by tomorrow, they'll give you $5 credit if you buy $10+ at a wide variety of small businesses by Sept. 20th. You can do this 10 times.
https://www.americanexpress.com/us/small-business/shop-small/

You’ve identified the storyline here. What remains is how will the story end? With a bang or a whimper? And when? Those who’ve seen the last 15 minutes of this movie aren’t letting on - if they know. It’s tempting to forecast a 50% drubbing of the stock market in short order. The “smart money“ waiting in the wings awakens and moves into stocks at sharply lower prices. A happy ending for the forgotten few who resisted the temptation to own equities and held out long enough. Right out of Disney.

For those with longterm views and appropriately positioned accounts & investing mentalities, I suspect it'll end in annoying and noticeable whimper. But for those who 'bet it all on XYZ because CNBC/Twitter/Newsletter said so' and just play the markets the way they play DraftKings or FanDuel or spin a roulette wheel, I suspect it'll end in a big, bloody, bang for them ... as it probably would and serve them right, I guess.
I might speculate on short-term index moves via futures or ETFs but 95+ percent of my investments are for the long term unless the current situation suggests I should 'raise shields' a bit and go defensive ... which I did w/stuff i bought in Feb which I wanted to hold for the long term, but which I sold this month after insane run-ups in recent months.
Too bad there aren't futures on popcorn we could go long on while watching things, eh? ;)

@little5bee I've done a couple credit card deals, but avoid then cuz that's a sure credit pull...
I also do other things, like reward programs where you link your credit card & each time you shop or eat at certain places you get additional rewards. I use iDine & Dosh for this...for example, 1 restaurant I go to, when those 2 programs combine with my credit card rewards, I get 19% cash back, in addition to reward points at the restaurant (where I'm over $1500 in free food & drinks banked now)

I find myself agreeing with Jim Cramer here ... which happens, from time to time.
Remember the irrational exhuberance going into the Dot Com Crash (Pets.Com!), the Housing Bubble (5 houses on NINJA loans!), and now this.
Remember when you start seeing day-trading ads and services on TV and people start buying into the mania thinking they can't ever lose and that markets only go in one direction (up) that it's time to start inching closer toward the fire exit. As Jeremy Irons' character from 'Margin Call' said, "it's not panic if you're the first one out the door."
What is particualrly disturbing is the 'gamification' of investing by platforms like Robinhood that conflate longterm "investing" for wealth-building and retirement planning with "trading".
My investment portfolio is downright boring compared to most people, and I'm fine with that. It's also why I don't believe in the indices or do index-based investing -- because they're so heavily influenced by a single-digit's worth of ultramegacorps and don't reflect broader equity sentiments.

You’ve identified the storyline here. What remains is how will the story end? With a bang or a whimper? And when? Those who’ve seen the last 15 minutes of this movie aren’t letting on - if they know. It’s tempting to forecast a 50% drubbing of the stock market in short order. The “smart money“ waiting in the wings awakens and moves into stocks at sharply lower prices. A happy ending for the forgotten few who resisted the temptation to own equities and held out long enough. Right out of Disney.
Equally likely are an alternative set of scenarios.
- A very long multi-year (even multi-decade) “rolling” decline to normal valuations with alternating good and bad years. Patient investors can still make money in such an environment - but would require more insight and ingenuity than simply buying the index.
- A rotational correction where the big overvalued names fall while the undervalued equity sectors gain. Financials have lagged. And while one might think the energy, commodity, natural resource sectors overvalued after a recent surge, truth be told those areas are just emerging from the worst decade long bear market in history.
- Correction by stagnation. Equities essentially go nowhere for a decade or longer while the dollar sags, global interest rates rise, and the CPI , real assets, real estate climb in value. Even without a sharp decline, equities would have returned to more normal valuations relative to the dollar and other asset classes over a decade or so.
- Black swans. War, domestic upheaval, shifts in the global balance of power, plagues, environmental catastrophe can all upend an economy and jolt markets leading to different end results than anyone anticipated.
.

Good morning Old_Skeet: You may have nailed it with your explanation from above.
Friday's close & my account was flat lined ! 0.00 % gain.
Better than a -0.4 loss on Thursday.
Fridays close below
DJIA
27,930.33 +190.60 (+0.69%)
NASDAQ
11,311.80 +46.85 (+0.42%)
S&P 500
3,397.16 +11.65 (+0.34%)
Russell 2000
1,552.48 -11.83 (-0.76%
Have a good weekend , Derf

Hi guys.
Politics aside.
My perspective (and thinking) on the stock market follow.
A little more on the barometer that will help explain what is now taking place within the S&P 500 Index which it follows. And, why this might be of concern. Over the past couple of weeks the big ten stocks that make up about 28% of the Index (as a group) have increased in their value while a good number of the underlying stocks have decline in their value. As of last week's market close 79% of the stocks wiithin the Index were trading above thier 50 day moving average and at the close of this week the number had declined to 66%. In addition, over the past two weeks there has been money moving out of the Index according to my money flow indicator, which moved from a reading of 84 to 52.
So, explain why the Index has moved upward in price over the past two weeks from 3851 (8/7 market close) to 3397 (8/21 market close) and reached a new high. It is very simple, the top ten stocks (as a group) have done most of the heavy lifting to propell the Index to it's new high while a good number of the underlying stocks have been in decline. The rise in the big ten (as a group) has been more than enough to offset the decine in the underlying (as a group) thus the price of the Index moved upward. After all, this is a cap weighted Index.
In the past, with a decline in money flow along with a good number of stocks moving from above to below their 50 day moving average has often times indicated that a stock market dip (or pull back) is in the making due to a decline in broad based support along with money leaving. This could be because of political convention activity and investors reacting to it by voting with their wallets through the selling of securities. In addition, there was a big increase in short volume in SPY on Friday.
So, what did Old_Skeet do? Absolutely nothing. I am still with my current asset allocation of 15/45/40 (cash/bonds/stocks). For the past five years (since retirement) I have been reconfiguring my portfolio from a growth allocation type which was as high as 10/20/70 down to the present all weather allocation of 20/40/40 which also affords some good income production. If I were to sell I'd be reducing my paycheck. In addition, I've got ample cash to put some into play during a stock market sell off. Presently, due to low cash yields and streached equity valuations I am overweight in bonds by +5%. For now, though, I'm mostly just sitting and watching.
Thanks for stopping by and reading.
Take Care ... Be Safe ... and, Have a Good Weekend!
Old_Skeet

@soaring - PRGTX, PRMTX, WAMCX and AKREX have all been winners for me. FCNTX is a fund my parents have held for decades and are really pleased with it. WAMCX is closing to new accounts on 9/11, here’s a recent MFO thread on its closing:
https://mutualfundobserver.com/discuss/discussion/56704/wasatch-ultra-growth-fund-wamcx-wgmcx-to-close-to-new-investors#latest
I hold these funds because they've outpaced their benchmarks. I'm younger than you so my risk tolerance may be higher than yours. Best wishes!

@soaring,

VGWLX - I recently discovered that this fund is not available for automatic investment at Fidelity. As I don't want to pay $75 TF for every addition, this one is likely to go.

I just checked with Fidelity, VGWLX is open to new investors, then you should able to buy more through automatic investment ($5/buy) as I have done many times on other transaction fee funds. Have you confirm this with a representative ?
The other option is to transfer part of the tax-deferred account to Vanguard and that would eliminate the restriction. I used to do the same with T. Rowe Price funds until T. Rowe Price made their funds available on no-transaction fee platform at Fidelity and Vanguard. Much easier to manage.

Thx...
We picked up GM, bought fordbonds ytm 7.07% rated bb+ never bankruptcybefore, added more to vanguard wellington and vang2045, also got new commodities-silver bars...
For mama portfolio - bought more fidelity2020 and fbnd bnd pci...she is complaining making too much from portfolio last yr and paying more to uncle Sam this yr lol...I guess something is heading right directions. I told her If something drastic happens to 2021 election may not be a rosey pictures in terms of capital gains /stocks bonds performance/and taxations changes 2021

Exciting New Territory for the S&P 500
It's going to be even more exciting when the S&P reenters familiar old territory.

Hi Derf, According two a couple of feeds in my barometer they have reflected over the past couple of days a softening and from past history this has often reflected that a dip (decline of 0% to 5%) or even a pull back (decline of 5% to 10%) perhaps even a correction is in the making. To me, this makes some sence due to political convention activity. We shall see. As I write the futures are down in most risk on asset classes. I not looking for an up day in the market as it is Friday and most traders will close out their open positions rather than carrying them open over the weekend. This is Old_Skeet's scientific wild ass guess (SWAG) so no gurantees on the above are made. My account was down -0.06% (6/100ths).