Discussion Topic |
|
This thread has been locked |
Reilly
Mountain climber
The Other Monrovia- CA
|
|
|
Sep 22, 2018 - 09:39am PT
|
What wuz the question?
|
|
Toker Villain
Big Wall climber
Toquerville, Utah
|
|
|
Sep 25, 2018 - 12:16pm PT
|
How to profit on the end of prohibition 2.0
|
|
Reilly
Mountain climber
The Other Monrovia- CA
|
|
|
Sep 25, 2018 - 02:24pm PT
|
I can see that giant hog farm southwest of you putting
its effluent to good use producing Momo Loco with a catchy byline:
“We got what you need in case you didn’t have sh!t for brains before”
|
|
Toker Villain
Big Wall climber
Toquerville, Utah
|
|
|
Sep 26, 2018 - 12:45pm PT
|
Fed bump day
|
|
EdwardT
Trad climber
Retired
|
|
|
Sep 26, 2018 - 01:05pm PT
|
Bump and dump.
|
|
Reilly
Mountain climber
The Other Monrovia- CA
|
|
|
Sep 26, 2018 - 01:16pm PT
|
BFD, we’re dead nuts on the 90 day moving average.
|
|
briham89
Big Wall climber
santa cruz, ca
|
|
|
Sep 26, 2018 - 01:27pm PT
|
Question....with interest rates continuing to go up I am thinking about taking all or most of my uninvested cash out of my bank savings account and parking it in a Vanguard federal money market fund. It has been paying around a 2.5% dividend lately and will rise with the next Fed bump. I can't really find a reason not to do this...other than Vanguard going belly up, but I don't see that happening. For context I am 28 years old and IMO "things" are volatile as we are 10 years into a bull market with the Fed raising interests rates and the IMF rolling back quantitative easing I don't want to be fully, or even majorly at this point, invested in stocks. Just looking for a bit more return than a savings account, while I sit on cash and wait for the world to lose its sh#t again....
|
|
Reilly
Mountain climber
The Other Monrovia- CA
|
|
|
Sep 26, 2018 - 01:33pm PT
|
Commendable logic, you sure you’re really a Murrican? Vanguard going belly up - funny!
There are some short term bond funds worth looking at too but a guaranteed 2.5% for the
next 18 months is not chopped liver, even if it’s out ahead of the inflation rate by only a nose.
FYI I don’t see either of Vanguard’s taxable money market funds paying 2.5%. The tax exempt
ones pay a lot less.
|
|
briham89
Big Wall climber
santa cruz, ca
|
|
|
Sep 26, 2018 - 02:40pm PT
|
FYI I don’t see either of Vanguard’s taxable money market funds paying 2.5%
I just double checked, you're right I misspoke(typed?), it's been around 1.9%. I was thinking more after a couple more FED bumps
|
|
Reilly
Mountain climber
The Other Monrovia- CA
|
|
|
Sep 26, 2018 - 03:02pm PT
|
^^^ Irrational exuberance? 😉
edit:
Wading into Benoit Mandelbrot’s The Mis-Behavior of Markets-A Fractal View of Financial Turbulence. Heavy going but amazing.
|
|
briham89
Big Wall climber
santa cruz, ca
|
|
|
Sep 26, 2018 - 05:03pm PT
|
The reason I was thinking the money market account as opposed to bonds is that the price of bonds keeps going down as interest rates increase (inverse relationship) and bond prices are vulnerable during recessions, so to my original question, money market account over savings account a good idea? I feel like it's kind of a no brainer, but no brainers tend to bite me in the ass so figured it was worth asking.
|
|
zBrown
Ice climber
|
|
|
Sep 26, 2018 - 06:07pm PT
|
The housing bubble, the credit crunch, and the Great Recession: A reply to Paul Krugman
However, as I argue in a new paper and blog post, the most damaging aspect of the unwinding bubble was that it ultimately touched off a broad-based financial panic, including runs on wholesale funding and indiscriminate fire sales of even non-mortgage credit. The panic in turn choked off credit supply, pushing the economy into a much more severe decline than otherwise would have occurred. My evidence for this claim is that indicators of panic, including the sharp increases in funding costs for financial institutions and the spiking yields on securitized non-mortgage assets, are strikingly better predictors of the timing and depth of the recession than are housing-related variables such as house prices, market pricing of subprime mortgages, or mortgage delinquency rates.
https://www.brookings.edu/blog/ben-bernanke/2018/09/21/the-housing-bubble-the-credit-crunch-and-the-great-recession-reply-to-paul-krugman/
https://www.nytimes.com/2018/09/12/opinion/botching-the-great-recession.html
https://www.nytimes.com/2018/09/14/opinion/t
|
|
perswig
climber
|
|
|
Sep 26, 2018 - 06:17pm PT
|
^^
RHCP sighting.
Dale
|
|
Reilly
Mountain climber
The Other Monrovia- CA
|
|
|
Sep 26, 2018 - 06:53pm PT
|
Those Brand X CD’s almost invariably have onerous rules. Jess sayin’...
|
|
Toker Villain
Big Wall climber
Toquerville, Utah
|
|
Don't want to be irrationally exuberant, but I haven't seen a day where my top ten are all in the green for quite some time. My railroads are at all time highs.
Clouds on the horizon though.
|
|
briham89
Big Wall climber
santa cruz, ca
|
|
Similar to a money market rate,
how about any of those high rate 6 month to 1 year CDs?
Many are from banks you never heard of, but still claim FDIC insurance.
The nice thing about the money market account is I can take cash out at anytime (after a bank transfer). It's basically a "high" yield savings account...without FDIC, but again with Vanguard, I'm not too worried about that. I think I'm going to move forward with this plan.
|
|
Fritz
Social climber
Choss Creek, ID
|
|
|
Topic Author's Reply - Oct 1, 2018 - 05:33pm PT
|
I'm sorry to share that current U.S. inflation rates are running around 2.7%.
I clicked on a couple of the CD rate charts & that impressive one year rate of 2.5% is losing you money, in the long run.
Of course, longer term CD's are paying higher rates, but with the current booming economy & Trump's tariff wars, inflation & interest rates are going to keep increasing.
|
|
briham89
Big Wall climber
santa cruz, ca
|
|
Yes that will be "losing" money compared to inflation. But it's a hedge against a looming down turn (I don't short stocks so cash is a hedge for me). I will re-enter after that happens. I'm happy to hear other ideas :)
|
|
Reilly
Mountain climber
The Other Monrovia- CA
|
|
So if bonds are no good now and a ‘major correction’ is coming then wouldn’t a savvy contrarian get into bonds now?
BTW, my Vanguard Total International Bond Index Fund made 2.22% in the last year,
a bad year for bonds.
|
|
|
SuperTopo on the Web
|
Let us know!