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.
Support MFO
Donate through PayPal
Sven
Lynn,
Thank you so much. I am planning on a 3-year ladder since I am a year away from retirement. Lots of spreadsheet work to calculate the income replacement needed. This ladder will create a steady income stream. So thank you for all your help.
I moved back to high quality bond funds this year. Some of which you covered in the SA article. For now, I will stay with agency bonds to the bond ladder. I will pick active managers for corporate bonds.
Sven
@BennyB, the main reasons we made the change were two folds. First, there were no managers quite like Micheal Price (solid return with lower risk). Donald Yacktman came the close. The other was the capital gain tax incurred when we had them in taxa…
Certainly I would welcome higher limit on I-bond.
Bought some 5-yr TIPS at auction earlier this year, and it is losing a bit as the bond price fell. @Devesh explained the unexpected performance in his September article about TIPS and short term T…
You should already see that in money market funds. It was not long ago when they yielded virtually zero % and many are yielding over 2%.
I notice that too with few of my bond funds with higher monthly yields, but that does not make up for their …
Never invested with Heebner; too volatile from one year to another. Micheal price, however, made considerable gain for us (Mutual Beacon and Discovery). We moved on elsewhere after he sold his firm to Franklins back in the 90’s.
Investing in acti…
Terrible last 9- 12 months
It is to be expected when both stocks and bonds are down simultaneously this year. The only bright spot among the TSP funds is the G fund which is a stable value fund and having a positive gain.
Agree with @yogibb. This is a good time to review your mutual funds even though many have not announced their CG estimates.
After the 2008's aftermath, I switched to index funds to minimize the unexpected large CG even in poor years.
Tough to pinpoint. Germany is now buying LPN from the Middle East.
https://al-monitor.com/originals/2022/09/uae-agrees-supply-germany-gas-diesel-scholz-tours-gulf
Natural gas price went up today accordingly. US and Canada potentially can supply …
Natural causes are unlikely. Who would benefit from this? This could shut off all gas flow to Germany. They are getting gas from tankers, and the price is likely to be much higher.
Yes, the total bond index (BND) got hit hard (-1.28%) today, while TRP floating rate bond is down -0.44%. At the same time, the yield of 10 year treasury reached 3.878%, the highest level for this year! And that is a bad omen for bonds. Also energ…
That is for sure. It is a good way to build a ladder.
https://tipswatch.com/2022/09/21/short-term-treasurys-even-more-attractive-now/
To keep up with this inflation, I will pick up more 5 yr TIPs when the auction comes, October 13, 2022.
You got it. At the onset of COVID pandemic, the asset correlation between bonds and equities collapses to near 1.0. If inflation persists, this situation can continue well into 2023.
Even during the internet bubble or GRC, the Fed was cutting rate quickly as the stocks fell and bonds rose. Right now the asset class correlation between stocks and bonds breaks down when they falling simultaneously. Thus bonds (even high quality o…
It is a mechanical problem that cannot easily be fixed by software. My understanding is that detector must rotate from one side of grating mirror to the opposite side in order to change wavelengths. Apparently in the absence of gravity, the instrume…
@orage, you are correct and I have corrected ma earlier post.
@yogibb, I believe this year’s challenge with both stocks and bonds are related to Fed’s quantitive tightening in addition to aggressive rate hikes. The only previous attempt by the Fed…
@carew388, during 2008 the Fed was cutting rates aggressively, but Fed is hiking rates instead. Think the YTD 13% loss of VWINX will worsen by year end. Remember, we still two rounds of rate hike this year.
Investment grade bond index Is down 15…
While it provides a good read for two key parts of the economy, it also serves as reliable indicator of what may be coming down the road. FedEx's earnings contracted in a similar way during the last three recessions — in 2020, 2009, and 2001, accor…
Good idea. 26 weeks treasury is in the sweet spot near 4%, whereas the yields flattens out quickly beyond 2 years. Also the auction is taken place weekly on Monday at brokerages or directly at TreasuryDirect.
After September rate hike, treasury yi…
In addition to better pay, the railroad workers are seeking more flexible work schedule and medical leave. The terms have not been passed by all the workers, but getting through the first step is good.
Federal workers on the hand, are not allow t…
No one really know the consequences of unwinding of mortgage bonds on Fed’s balance sheet.
Even if I have the money, don’t think I want a vacation home at 6% rate? Throughout the pandemic, we had inexpensive car camping trips at national parks on…
NPR does a good job in their journalism in getting to details of the reporting. This reminds me of Upton Sinclair’s “The Jungle” that I read in high school about meat packing industry in Chicago.
NBC and NPR also reported the same news too.
https://nbcnews.com/news/us-news/biden-announces-tentative-deal-avert-us-rail-strike-rcna47850
Excerpt from NPR,
The deal also includes changes to workplace attendance policies that workers found overl…
He would buy long-term Treasuries because the deflation risk is much higher today than it has been for the past two years
He owns European stocks and would buy emerging markets once the US dollar breaks below its 200-DMA
Don’t understand his logic…
Interesting article from Mother Jones. It is more than supply chain problem, the weather…
https://motherjones.com/environment/2022/07/record-breaking-heat-wave-food-prices-crops/
August CPI came in 8.3%, not much improvement. While gasoline price is down but food and others went up. Consumer spending remains strong. Core-CPI went up to 6.3% from that of July’s 6.1%.
Today, 10 years treasury moved up to 3.431% and the ma…
Ukrainians are fighting for their country to stay sovereign while the Russian soldiers are fighting for their paycheck. Some new recruits are not inform they are going to foreign land. Very different motivation. Russian military tactics has not evo…
Let’s hope that August’s CPI number releases on Tuesday, Sept 13 is lowered than than of July, peaking of inflation maybe the turning point of the Fed to slowdown the rate hike. Many said a 50 bps is more likely. Think I will buy more treasury af…
You are absolutely right that news are moving fast over there. It is very encouraging to see they are making solid progress. Ukrainian soldiers and civilians are paying dearly in this war. There is not as much coverage on their suffering and huma…
FPA New Income fund has done much better than majority of multi-asset bond funds this year, -2.6%. @AndyJ has a good point that money market funds now yield about 2%. After interest rate hike in September (expecting 50 bps), money market funds wou…
