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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.
  • PPI > CPI Means Margin Pressures
    Like in China earlier (PPI >> CPI), the US PPI > CPI too. This means that companies cannot pass on their increasing costs to their customers. Hence, the pressures on profit margins.
    https://www.cnbc.com/2022/04/13/producer-price-index-march-2022-.html
  • While You Were Sleeping - FAIRX is #1 again
    Seems more sensible to just buy St. Joe directly and avoid the potential tax hit of FAIRX selling some of its appreciated shares as well as FAIRX’s management fees. I sometimes wonder what it would feel like to be a manager getting paid millions of dollars for essentially a 1-stock portfolio. I think I would check my stock in the morning before the market opens, “oh nothing is happening to Florida coastal real estate, oh it continues to sit there.” Then I’d go fishing on my yacht shareholders paid for, bringing my phone of course. At noon I’d glance at the stock again—oh nothing is happening to Florida coastal real estate today, oh it continues to sit there.” Then I’d go back to fishing. To be more efficient, sometimes I wouldn’t even check my phone. I’d just look at the coast I’m fishing on and watch it continue to sit there. Occasionally, if I have the energy and am feeling generous, I might wave to the shareholders without yachts on the shore.
  • Another Absolutely Awful Day for Bond Funds
    @hank, I-Bond sales data are available as Excel download, https://www.treasurydirect.gov/govt/reports/pd/pd_tdsecuritiesissued.xlsm
    Monthly I-Bond Sales
    10/2021 $0.23 billion
    11/2021 $1.07 billion (new rate 7.12%)
    12/2021 $2.78 billion
    01/2022 $3.26 billion
    02/2022 $0.91 billion
    As noted in the I-Bond thread, one can bunch up lot of buying as gift I-Bonds. So, let us say that you have 5 favorite relatives and friends (include me, if you want (-:)), then you can buy, say, $100K for EACH in gift I-Bonds to HOLD in your Treasury Direct account, and dole/DELIVER them out at $10K/yr/person over 10 years. That would be $510K total in I-Bond purchases NOW or ON 5/1/22, $500K in gift I-Bonds and "puny" $10K for yourself (-:). Well, this a hypothetical for those who complain about not being able to buy enough but think of the estate and asset transfer angle. Of course, you cannot have the gifted bonds yourself for any reason (actions are irreversible).
    What if the I-Bond rate collapses in a year or two? Well, then you still go through your estate plan but the receiver can sell them and buy something else.
    Edit/Add: Treasury Direct also has linkable history of Savings Bond sales, 1935-2012. Sales peak (including all types of Savings Bonds) were in 1944 ($16.04 billion; WW II time), 1978 ($7.96 billion), 1986 ($11.91 billion), 1992 ($17.70 billion), 2001 ($11.58 billion), 2005 ($22.43 billion). I am sure there is a good story behind the ups and downs in the Savings Bond sales. https://www.treasurydirect.gov/indiv/research/history/history_sbsales.htm
  • While You Were Sleeping - FAIRX is #1 again
    FAIRX ranks in the top 1 % percentile for Large Value funds (YTD)...rising from last in class...the fund's bifurcated performance over the last decade has been a very bumpy ride for shareholders. I exited the fund years ago. M* places FAIRX in the LV category yet describes it's investment style as Small Growth.
    77% of the fund is one company (St Joe = JOE) which probably was bought at a low in 2008. JOE's weight seems to skew it into the SG investment style while the other holdings (24% of portfolio) appears more LV. 42% of JOE is owned by Fairholme. For that privileged Fairholme shareholders pay a 1% ER. Ouch!
    Anyone use this fund in small amounts? Attempt to buy the lows, not the highs when it comes to the fund.
    image
  • Another Absolutely Awful Day for Bond Funds
    “Outflows from MM funds is an interesting phenomenon when total outflows from MM plus bond funds together constitute 50% more than the inflows into equity funds. And working folks are constantly earning new money and so, I expect MM funds to continuously have inflows. Are folks starting to draw down MM funds to fill their online savings accounts + buy (treasury?) bonds directly? or is there a bigger phenomenon such as private equity + venture investing + multiple home / rental real estate + alternate assets investing?”
    Is there a way to track inflows into these iffy I-Bonds? $10,000 ain’t much for 1 individual. But to coin an old song: $10,000 here … $10,000 there …and pretty soon you’re talking about real money.
  • Another Absolutely Awful Day for Bond Funds
    Only 1.2% of PRWCX was in TFAIX at year-end? But that is specifically a bank loan fund. ....In other news: I had 4 bond funds. Down to 2 now: PRFRX and TUHYX. Great timing with the HY, as ever. Doggy poopies.
  • What are you buying - if anything?
    @hank, as mentioned in my first post, I was enquiring about investment grade that is what I will be unloading. Not a big position, which I bought in 2013-14 and today when rates fell throughout the curve, Muni is the only sector that lost ground - answered my relative question. Even NVHIX was lower. I am not worried about defaults but market sentiment is an entirely different matter. I already bought IBonds for 2021 & 22 because it took less than a minute to do so. I am not going to use the tax overpayment to buy more as that requires more work and I already own them in six figures. I plan to hold them past the 5 yr mark.
  • Teach your children well,,,,,,,,
    @ Observant1…..i agree. She was lucky to get Vpmax, With no min purchase and it was generally closed at the time. Now I am encouraging her to jump on I Bonds. She is a medical professional and that low limit doesn’t seem to get her interest. Haha.
  • Teach your children well,,,,,,,,
    It's not unusual for the Primecap team to experience periods of underperformance.
    VPMAX trailed the S&P 500 the past three calendar years.
    Their funds have always bounced back.
    I'm fairly certain that VPMAX will generate good long-term returns for your daughter.
    She is fortunate to have this fund available in her 401(k).
  • Phaeacian Accent International Value & Global Value Funds to be liquidated
    In its 5/24/21 issue, Barron's noted that value had been down for so long that many older value managers died, retired, quit or became GARP managers. But it identified a handful of the "next generation" of value managers who had at least 10+ years of career ahead of them. Ironically, Pierre Py was among those. May be it is just a business setback for him. https://ybbpersonalfinance.proboards.com/post/140/thread
  • I-Bond Rate, 5/1/22 – 10/31/22 (A Guess)
    Excellent info at your thread @yogibearbull.
    If one's anticipation of terminal inflation rate during one's anticipated holding period of a new iBond is materially lower than 7.12%, I think it may be better to buy them this month. The Fed members seem to be bent on pushing inflation back down to 2-3%, whatever it takes! Lael Brainard made comments this AM about that too. How soon they would succeed? One can make a wager of their conviction by buying iBonds this month (initial rate 7.12%) or next month (initial rate 9.62%).
  • Phaeacian Accent International Value & Global Value Funds to be liquidated
    https://www.ancient-origins.net/myths-legends/mythic-scheria-and-legendary-phaeacians-001034
    Scheria is a mythical place in ancient Greek mythology that was the home of the legendary and mysterious Phaeacians, who were known to be masters of the seas. The first reference to this place is found in Homer’s Odyssey.
    If we start with the etymology of the word Phaeacians, we will see that the first part ‘Phaios’ means ‘Grey’, probably referring to them as dark skin people. According to Homer, the kings of the Phaeacians where ancestors of the God Poseidon and started with one of his sons, Phaeax.
    Phaeacians were the beloved of the Gods but also friends to humans. Their place of abode was initially mentioned to be far away at the end of the world. They were relatives to the Gods in the same way as Cyclopes and Giants were too. When Cyclopes attacked the Phaeacians then they had to move to Scheria the ‘island of the Phaeacians’, which was probably an island of unknown location (I say probably because Homer doesn’t clarify if it was an island or a place next to the sea).
    The island of the Phaeacians was the last destination of Odysseus before arriving to Ithaca. Therefore, we could assume that it could be a place close to Ithaca. That assumption gave birth to the suggestion that the island of the Phaeacians was the Greek island Corfu. Corfu is one island close to Ithaca and it matches the description of Scheria in the Odyssey. However, no excavations have brought to the surface any evidence for the mythical civilization of the Phaeacians. Furthermore, the island is so close to Ithaca that it wouldn’t have taken one night for Odysseus to arrive, as written in the Odyssey.
    I'm trying to imagine the meeting where someone said
    "I know. We'll call ourselves Phaeacian!"
    And everyone says
    "Yeah. That's a great idea!"
  • I-Bond Rate, 5/1/22 – 10/31/22 (A Guess)
    There has never been an out-of-stock situation for the US Savings Bonds. Limits are per account. So sales of I-Bonds have ballooned to about 10x, but that is still only low double-digit billions, but Uncle Sam needs/borrows trillions (-:).
    It is not $10 K that I think about, but I look at it like $356 now, or $481 soon, of free money found on sidewalk every 6 months. Do I pick it up? Yes. I am a sucker for free coffee too at banks etc, but unfortunately, they found an excuse to do away with those citing Covid risks.
    Gifting among close family members & friends is a loophole when one person has lot of spare money but others don't. Then, gifting allows that one person to sort of tap into all those other limits that go away annually (i.e. the limits don't carryover). But one cannot have own cake and eat it too. See details here, https://ybbpersonalfinance.proboards.com/post/577/thread
  • I-Bond Rate, 5/1/22 – 10/31/22 (A Guess)
    They really need to up the maximum $$$ an individual can buy. $10K is a lot to some, chump change to others. If I could load up a hefty slug at these rates, I'd be quite happy. Not sure it's worth the hassle of maintaining another account for 'just' 10K/yr.
  • I-Bond Rate, 5/1/22 – 10/31/22 (A Guess)
    Wow. That’s a hellofa rate. Traveling. Will digest when back home.
    ISTM other sectors of the lending market will need to adjust. Less than sterling borrowers (lower rated and junk) should have to pay a very high rate. In fact, wonder if this will have a dampening effect on the economy?
    The qualifier here is the $10,000 maximum. But, if enough people buy these it could still have an impact. The nearest thing I can remember is back in the 70s or 80s when you could earn 15-20% in some money market funds. Of course money funds today are a lot more restricted in the credit they own.
  • Teach your children well,,,,,,,,
    If you Can...by William Bernstein:
    Would you believe me if I told you that there’s an investment strategy that a seven-year-old could
    understand, will take you fifteen minutes of work per year, outperform 90 percent of finance
    professionals in the long run, and make you a millionaire over time?
    Well, it is true, and here it is: Start by saving 15 percent of your salary at age 25 into a 401(k) plan,
    an IRA, or a taxable account (or all three). Put equal amounts of that 15 percent into just three
    different mutual funds:
    A U.S. total stock market index fund
    An international total stock market index fund
    A U.S. total bond market index fund.
    Over time, the three funds will grow at different rates, so once per year you’ll adjust their amounts so
    that they’re again equal. (That’s the fifteen minutes per year, assuming you’ve enrolled in an
    automatic savings plan.)
    That’s it; if you can follow this simple recipe throughout your working career, you will almost
    certainly beat out most professional investors. More importantly, you’ll likely accumulate enough
    savings to retire comfortably.
    How Millennials Can Get Rich Slowly
    First Reading Assignment (From William Bernstein):
    the millionaire-next-door