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Threw in my cards on FLTR and SCHO--about 15% of my IRA--and took a piddly loss for peace of mind. Decided I don't want indexes, and I don't want to think about NAV spreads on ETfunds. That leaves me 38% cash. Bonds are now represented by MNHAX, CBRDX, CBLDX, BUBIX, and PRWCX at about 38% of holdings.
I can't see cuts coming at all, until some simple, added stability is provided, politically. The tariffs, even with the exceptions and partial delays on some goods, just have everything all jumbled. Inflation will RISE, not fall. For those who know how to play the volatility, these days might be a good time. Too much work for me.
This week two of the ex-Presidents of Dallas Fed (Kaplan and Fisher) were on TV and talked about the direction of rates. You can hardly say they are liberal mouth pieces and both are business men. Hopefully, you can find the clips on Youtube.
I happen to look above your post WABAC, and noted a post by BaluBalu. Where did he go ?
We exchange PM's every once in a while. I don't think I'm talking out of school to say that he has simplified his portfolio to suit his comfort zone so may not feel the need to sample our collective wisdom quite so often.
Prepare for rate cuts? .....Everyone and his uncle expects a 0.25% cut by the FED next week. The banks and businesses will rejoice, probably way too much. Already today, Thursday, Mr. Market was partying "like it's 1999." LOUD start.
...Allegedly because the latest inflation statistics did not figure to change the overall orientation. So, the cut is indeed still in the cards. Prepare? I'm sitting tight. A quarter of a point will not move the needle for me. Quite a nice bump-up today, but it's just one day. Even so, it's been a better year in the portfolio than I'd have expected, given the political turmoil. but as ever, Mr. Market ignores politics... until he can't, any longer. Then the spam will already be hitting the fan. 52.22% stocks. 46.76% bonds. (27.75% Junk, 18.6% core US bonds. Tiny slivers of TIPS and Developed country bonds.)
I started preparing for rate cuts in 2023, once it appeared that rates were close to peaking. Also, taking advantage of those higher rates to make some fairly risk-free money in MMF, ultrashort and short term bonds, and some MS bond funds. These low-risk positions enabled me to take more risk in equities, while staying frosty. For 2025, our Roth up 15% YTD. TIRA up 14.2% YTD. Our 401k (60/40) is up 10.5% YTD. Our "general" taxable account is up 11.4%, this being where all of our MMF and ultrashort reside. Stocks, such as CEG (+43%), KLG (+41%), JNJ (+26%) and a host of mutual funds with 14-16% gain have really propped this last category up.
I believe that bond-like assets are set to do quite well as rates decline. Equities may also benefit from rate cuts, unless inflation weakens the golden goose (consumer), through higher prices, and/or job losses destroy consumer confidence and spending momentum. I also believe that tariffs have consequences, that may yet to be felt. So, watching equities closely here. I am shifting more cash to areas that may benefit from rate declines, as well.
Currently, 58% equity, 22% bond(ish) FI, and 20% MMF/ultrashort bond/cash subs. While politics should not impact your choices, the impact of politics absolutely should be taken into consideration. Rates, tariffs, trade initiatives, deficit spending, national debt are all economic examples of politics that impact markets. Not to be ignored.
I am pretty sure that Pimco CEFs are going to shine in the next 6-12 months. Maybe outshining stocks. Nor do I care about their performance during less favorable periods, only what they can do for me at this time. When that changes, so will my allocations. I am weighing whether to sell more equities to beef up bond fund positions.
When markets stop trading on fundamentals, you get a mini-bubble. That's where we are at.
If Fed rate-cuts are the basis for a continued rally, good luck with that.
This is precisely why I am leaning into certain bond oef/cefs/cash and shrinking my equity exposure. I fear that any equity rally may be short-lived. Should a large equity correction ensue, I want to be prepared for bottom fishing.
And BS1000 owned bonds the whole time. So why does Captain Obvious have to make it seem like he always knows best when stocks outperformed... while he owns bonds?
I guess someone needs to get their eyeglass prescription checked. I don't see anywhere in DrVenture's post where it talks about owning PDI from 2023 to whatever. Also preparing for rate cuts does not equate to owning the fund either.
not putting any effort to time this due to chances its well priced in, but this seems the most succint take i have seen on the interwebs :
"...At current rates, a 0.5% or even 1% cut will not have any economic impact to speak of. Borrowing rates are already at levels the US economy has flourished in the past and lower rates while better are not the economic push essential to propel growth. It will have a major market psychology impact. However, many will believe that after having the PMI essentially below 50 the last 3yrs with fear of recession, the psychological impact will prove considerably positive." valueplays
in short, the economy is grinding on, both real and grift markets are hot, employment slowdown may still be in the noise. the cut is simply for trump\gop sentiment numbers. growth going down seems ~95% certain, and recession seems <30%.
if and when the economy is undeniably weak with LAGGING indicators, i expect the gop to implement YCC to avoid real pain. they may first attempt reversals of tariffs and other such by declaring a victory.
I guess someone needs to get their eyeglass prescription checked. I don't see anywhere in DrVenture's post where it talks about owning PDI from 2023 to whatever. Also preparing for rate cuts does not equate to owning the fund either.
You are absolutely correct. Thank you, Mark. My total return on my portfolio in both 2023 & 2024 was +25% each year, on an 80/20 portfolio mix. Not feeling like I missed out on anything. Not then, not now. I take risk, when I feel that risk is appropriate. And less risk, when I feel that less risk is appropriate. As I stated, I am now at 58% equities. I may go lower.
Yet, we are not here to talk about the past, are we? PDI has smashed the S&P in 2025. Timing is everything. I expect CEFs to do very well going forward, for some time, until they don't.
I certainly do not recommend anything to anybody. Or feel the need to pass on platitudes about the S&P to seasoned investors. I might add that I believe the S&P makes a great place to start. Still, my individually selected stocks portion of my portfolio (10%) beat the S&P by a significant amount in 2023, 2024 & YTD 2025. That, and some select sector funds, is how I beat the S&P with an 80/20 allocation in most years.
Back on topic, for those unwilling to be at a high level of equities (which is likely most here), there is probably going to be good opportunities in FI. Especially if someone is willing to take a little risk, at the right time. That is only my humble opinion. And subject to revision.
... if and when the economy is undeniably weak with LAGGING indicators, i expect the gop to implement YCC to avoid real pain. they may first attempt reversals of tariffs and other such by declaring a victory.
That seems correct. And tariff reversals under pressure may be one action by this administration. Of course, that utterly undermines most of their narratives. Fentanyl, trade deficit remediation, on-shoring, new revenue, all kicked to the curb if they reverse tariffs.
I believe that they think lower rates will allow them to not reverse tariffs. But China doesn't appear to be budging. So, do they give our biggest adversary the best deal? That will be a kick in the teeth to our allies and preferred trade partners.
So far, China has not pre-ordered any soy beans for the upcoming harvest. Farmers are rightfully freaking out. Rare Earth magnets, other minerals, inexpensive consumer goods, agricultural harvests, all hang in the balance. And even at these levels, tariffs will not promote the massive manufacturing surge that was promised. Tariffs are producing revenues, but ANY tax will do that. Not some economic genius at work here.
Comments
Edit:
Thought I could use a refresher course on all the good ideas back then.
Since March 6 MNHAX and CBRDX are no longer in my lineup.
Add>>I'm a lot less nervous about bonds than I was back then. LOL, I was freaking out about ever penny move.
.....Everyone and his uncle expects a 0.25% cut by the FED next week. The banks and businesses will rejoice, probably way too much. Already today, Thursday, Mr. Market was partying "like it's 1999."
LOUD start.
...Allegedly because the latest inflation statistics did not figure to change the overall orientation. So, the cut is indeed still in the cards.
Prepare? I'm sitting tight. A quarter of a point will not move the needle for me. Quite a nice bump-up today, but it's just one day. Even so, it's been a better year in the portfolio than I'd have expected, given the political turmoil. but as ever, Mr. Market ignores politics... until he can't, any longer. Then the spam will already be hitting the fan.
52.22% stocks.
46.76% bonds. (27.75% Junk, 18.6% core US bonds. Tiny slivers of TIPS and Developed country bonds.)
Single stocks: BLX, FBP, ET.
Funds: BALFX, PRWCX, PRCFX, TUHYX, PRCPX.
*Junk bonds.
Stocks + bonds have done well YTD regardless of rate cut.
If Fed rate-cuts are the basis for a continued rally, good luck with that.
I believe that bond-like assets are set to do quite well as rates decline. Equities may also benefit from rate cuts, unless inflation weakens the golden goose (consumer), through higher prices, and/or job losses destroy consumer confidence and spending momentum. I also believe that tariffs have consequences, that may yet to be felt. So, watching equities closely here. I am shifting more cash to areas that may benefit from rate declines, as well.
Currently, 58% equity, 22% bond(ish) FI, and 20% MMF/ultrashort bond/cash subs. While politics should not impact your choices, the impact of politics absolutely should be taken into consideration. Rates, tariffs, trade initiatives, deficit spending, national debt are all economic examples of politics that impact markets. Not to be ignored.
I am pretty sure that Pimco CEFs are going to shine in the next 6-12 months. Maybe outshining stocks. Nor do I care about their performance during less favorable periods, only what they can do for me at this time. When that changes, so will my allocations. I am weighing whether to sell more equities to beef up bond fund positions.
I started preparing for rate cuts in 2023
FD: looks to me, you missed performance. SPY, the easiest most common index, aka, the market, made over 77% during 2003-5.
https://schrts.co/wUfkzfTU
not putting any effort to time this due to chances its well priced in, but this seems the most succint take i have seen on the interwebs :
"...At current rates, a 0.5% or even 1% cut will not have any economic impact to speak of. Borrowing rates are already at levels the US economy has flourished in the past and lower rates while better are not the economic push essential to propel growth. It will have a major market psychology impact. However, many will believe that after having the PMI essentially below 50 the last 3yrs with fear of recession, the psychological impact will prove considerably positive."
valueplays
in short, the economy is grinding on, both real and grift markets are hot, employment slowdown may still be in the noise. the cut is simply for trump\gop sentiment numbers. growth going down seems ~95% certain, and recession seems <30%.
if and when the economy is undeniably weak with LAGGING indicators, i expect the gop to implement YCC to avoid real pain. they may first attempt reversals of tariffs and other such by declaring a victory.
Yet, we are not here to talk about the past, are we? PDI has smashed the S&P in 2025. Timing is everything. I expect CEFs to do very well going forward, for some time, until they don't.
I certainly do not recommend anything to anybody. Or feel the need to pass on platitudes about the S&P to seasoned investors. I might add that I believe the S&P makes a great place to start. Still, my individually selected stocks portion of my portfolio (10%) beat the S&P by a significant amount in 2023, 2024 & YTD 2025. That, and some select sector funds, is how I beat the S&P with an 80/20 allocation in most years.
Back on topic, for those unwilling to be at a high level of equities (which is likely most here), there is probably going to be good opportunities in FI. Especially if someone is willing to take a little risk, at the right time. That is only my humble opinion. And subject to revision.
I believe that they think lower rates will allow them to not reverse tariffs. But China doesn't appear to be budging. So, do they give our biggest adversary the best deal? That will be a kick in the teeth to our allies and preferred trade partners.
So far, China has not pre-ordered any soy beans for the upcoming harvest. Farmers are rightfully freaking out. Rare Earth magnets, other minerals, inexpensive consumer goods, agricultural harvests, all hang in the balance. And even at these levels, tariffs will not promote the massive manufacturing surge that was promised. Tariffs are producing revenues, but ANY tax will do that. Not some economic genius at work here.