No. of Recommendations: 10
The last year was the easiest of my investing career. WEB has said that he has no FOMO or jealousy in investments, he is just fine seeing other people make money their way, he is happy as long as he has a good grasp on his investments and they are doing more or less what he foresees in them.
I felt confident cutting back on BRK in my tax free accounts, because there were good opportunities in high yield investments. I was looking for yields of 7-9% and expected a rate cut would give me another 5% CG boost. A recession was a real possibility, and that would have accelerated rate cuts. A fairly safe 12% return looked just fine. As it worked out, I got a 5-15% CG boost, and had quite a few investments with a total return of 20%. The funds I moved out of BRK lagged BRK, but I'm OK with that, my plan was sound and I also have a seriously disproportionate amount of BRK in taxable accounts.
Going forward is tougher. I have concerns the new administration will enact policies which could bring inflation back up. A recession seems likely sometime soon, they are not rare and it seems a bit overdue. The stock market certainly has some froth to work off. We all did great last year, but I'm becoming a bit defensive going forward, moving to lower yield, safer assets in the tax free accounts, cashing in some BRK in the taxable accounts and mentally preparing myself for some lackluster returns. As William Bernstein says, "When you've won the game, stop playing". Capital gains taxes keep me on the field, but that is probably a good thing for the long term money.
