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- Manlobbi
Halls of Shrewd'm / US Policy❤
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Gundlach comes on at 23 Minute mark
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Maybe there is some interesting information in the more than an hour long video of someone I don't know, but in such a case:
please give a hint what it's all about or why it's relevant here or why I should watch the video.
Otherwise hundreds of readers here will lose valuable life time, only to ask themselves: so what?
Or even worse: they put you on ignore.
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It is the future path of rates and the global financial system.
Nothing important
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Hi, despite the technical difficulties, it was worth the 45 minutes, so thanks for sharing. Jeff's main message is, try not to lose money in 2023. He thinks the fed raises 1/4 point, unless another bank goes bad, then no increase next week. He said the cost to hedge duration risk is prohibitively high, when rates were so low. Just a reminder, the vanguard federal mmf currently yields 4.6. I have check writing and wire privileges , and I use that cash to secure puts I'm short. As the song goes, who could ask for anything more? Have a great weekend all.
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' Just a reminder, the vanguard federal mmf currently yields 4.6.'
Didn't mmfs go upside down and freeze in 2008? Which is safer and more liquid, a mmf or a treasury ladder?
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' Just a reminder, the vanguard federal mmf currently yields 4.6.'
Didn't mmfs go upside down and freeze in 2008? Which is safer and more liquid, a mmf or a treasury ladder?This is easier:
https://investor.vanguard.com/investment-products/...VGSH Vanguard Short-Term Treasury ETF
30 day SEC yield 4.73%
I have money in the vanguard federal mmf and VGSH. Don't think we're in a 2008 situation, but who knows?
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Just a reminder, the vanguard federal mmf currently yields 4.6.'
This is easier:
VGSH Vanguard Short-Term Treasury ETF
30 day SEC yield 4.73%
It may be easier, but it's not the same.
When investing in bonds you need to pay attention to both credit risk and duration risk.
Obviously there is no credit risk in both, but VGSH has a duration of 1.9 years whereas Federal Money Market Funds have a duration of 7 days.
Duration risk, also known as interest rate risk, is a measure of the effect on price changing interest rates will have. This can work for or against you depending on which way interest rates are going.
If the goal is to have cash which is earning some interest, a Federal Money Market Fund is absolutely the way to go.
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It may be easier, but it's not the same.
When investing in bonds you need to pay attention to both credit risk and duration risk.
Of course, I meant VGSH is easier than managing a bond ladder. But all good points.
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Didn't mmfs go upside down and freeze in 2008? According to this article it's only happened twice: one small one in 1994, and one large in 2008. The one in 2008 was serious enough that it required backstopping, and the rolldown stopped.
https://abcnews.go.com/Business/study-78-money-mar... Buffett does all these deals, which were nice, but couldn't he (and we) have done so much better just buying stocks? Sometimes it's better to rescue everything for tomorrow rather than get rich today, even as the lifeboat is sinking. I don't know if that's what happened, but Morgan did the same in 1907 when he got the bankers together to rescue the system instead of just himself.
Based on the number of Regional Banker honcho flights into Omaha in recent days, (Bloomberg confirms only that Warren is having conversations with the White House about things including regional banks) it may be happening again. Dunno.
there was much more money to be made buying equity of SBUX, Apple and AXP in 2008/09 Did your know that at the time, or is this after-the-fact cherry picking?
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hi,I do recall that a few MMFs were at risk of breaking the buck back then but I seriously doubt VAN or Fido would have. For those with an interest, "" Product summary
Vanguard Federal Money Market Fund's investment objective is to seek to provide current income while maintaining liquidity and a stable share price of $1. The fund invests at least 99.5% of its total assets in cash, U.S. government securities, and/or repurchase agreements that are collateralized solely by U.S. government securities or cash (collectively, government securities). As such it is considered one of the most conservative investment options offered by Vanguard. Although the fund invests in short-term U.S. government securities, the amount of income that a shareholder may receive will be largely dependent on the current interest rate environment. Investors who have a short-term savings goal and are interested in a fund that invests in securities issued by the U.S. government or its agencies may wish to consider this option.""
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'Did your know that at the time, or is this after-the-fact cherry picking?'
This reminds me of our investment in Harley Davidson bonds in 2009 with a 15% yield. WEB said at the meeting in hindsight we would have been much better off buying the stock, however the bonds made more sense given the risks at the time, the Berkshire way. Btw, I had forgotten we bought the bonds alongside current director Chris Davis!
For those interested:
https://www.reuters.com/article/harleydavidson-ber...
