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.
Only m-mkt funds and T-Bills are "cash" alternatives. No other fund, including the ultra-ST bond funds, can formally serve that purpose.
But many posters do use ultra-ST and short-terms bond funds for liquidity. I was surprised that several ST bond…
May be it was just talk or hubris that Schwab could handle the flight of all uninsured deposits from its current liquidity (counting access to Fed BTFP & Fed Discount Window). It is issuing these bonds now at much higher rate than it could last …
M* has invested a lot in ESG - it owns the ESG rating firm Sustainalytics that has also generated some controversy over its rating methodology. The ESG ratings for funds are displayed in a tab on fund quote pages.
This seems a part of M* ESG/sust…
I have read that in case of no/delayed debt-ceiling resolution, the T-Bill may hit 8-10%. Just imagine the mark-to-market (MTM) chaos that will cause for m-mkt funds, bank capital, loan collaterals. May be the government will declare some MTM holida…
Several fund families now have 0% ER funds for advisory accounts only. Fido version is Fido Flex, TIAA version is class W, etc. I am sure that the firms get some cut from the advisory fees although this isn't visible to clients.
Fido also has retai…
Dollar diversification is one of the reasons for foreign exposure. Dollar has been strong for last several years, but may have peaked in September 2022. Since then, the pattern is of a decline (look at declining 50d-MA and 200-dMA) with wiggles up/d…
Good to know that this reclassification to "Gift" is possible after the fact. Of course, in your case, it was a mistake, but the solution could have been more messy.
Some used the Gift route while the I-Bond rates were high, but the rate now may no…
SPACs have been disasters, and the general IPO market is almost dead.
Premerger-SPACs is a niche area that benefits from the problems of SPACs - they have about a 2-yr window to find something OR refund the money. It is the latter part that benefi…
Regional bank KRE is in mid-30s again (as in early-May). I think that is good price for it - but after an initial position in early-May, I am not adding to it here. The downside is 2020/pandemic-low in mid-20s. The upside is if there is a comprehens…
The problem is that almost everyone thinks that a solution for the debt-ceiling problem will be found at the last minute. But then, most think (at least in the DC) that it is for others to fix it. A meeting of the main players scheduled for Friday w…
@Mark, congratulations.
In 3 months when he gets his Social Security number, open a grandparent 529 to get a head start on college. Recent changes have eliminated previous roadblocks for this.
Twitter is buzz with rumors - she is establishment, with high-level WEF connections, etc, while Musk is so anti-establishment. I think she is smart enough to make sure that any spur-of-the-moment actions or firing by Musk will be very costly to Musk…
@hank, strange thing about StockCharts is that custom settings carryon for a while, but after some time, they default to 1-year. So, my comment about resetting the date. Good that you could see custom 9/22/22 as intended.
All major indexes are similar since 9/22/22, except R2000. In the chart link below, enter date 2022-09-22. However, there were other dips in Oct, Nov, Dec 2022.
https://stockcharts.com/h-perf/ui?s=$INDU&compare=$COMPQ,$SPX,$TRAN,IWM&id=p5371…
This FDIC proposal is under the US government agency's rule-making authority. So, the proposal is published, people & businesses can comment for 60 days, the agency may tinker with the proposal (or not), and the proposal goes into effect as a ru…
This is almost a soft expansion of the FDIC insurance, although not stated explicitly.
First, the FDIC covers ALL deposits at 3 failed banks (SVB, Signature, First Republic). Second, to recover its costs, it imposes this 12.5 bps fee for 8 quarter…
One problem is that legislative Acts that are passed are applicable for years/decades and many are touted to be budget-neutral when passed. But that is based on wild guesstimates of future economy, taxes, consumer and business behaviors. Many Acts a…
Which VIX?
There are now several VIXs. The default VIX is really VIX30D.
The newest VIX1D is showing very high daily volatility as it is affected by volatility-decay as the 0DTE (near day-start) approach expiry and more 1DTE (near day-end) are pi…
See FDIC FAQs on First Republic & brokered CDs. Delays may be because only the broker has customer details & Cede may be involved as an intermediary.
"WHAT HAPPENS WITH MY BROKERED DEPOSITS?
All brokered deposits, excluding the Cede & …
HTM Treasuries/MBS are in longer-dated or investment portfolio. They won't be in the "cash" portion. Also, the CUs are much simpler in structure than banks. I haven't read about this being an issue for the CUs.
Bank ratings and supervision have to adjust to the underwater HTM Treasuries/MBS and CREs on bank balance sheets. These have been the cause of recent bank runs and many more are vulnerable. I learned recently that this problem of not/delayed mark-to…
@Bobpa, moderate-allocation BALFX (60-40) is NTF at Schwab. You may use it in combination with m-mkt or ultra-ST/ST bond fund to adjust allocation to comparable 38-62 for VWINX.
Long-term PFF chart from Twitter LINK. It is underperforming financials by a lot because of the concerns that noncumulative bank preferred may be worthless in the FDIC or other bank rescues.
I did a quick search on the 14th Amendment.
Its context was the Civil War issues and related debt and some links mention that explicitly in its title, although in its final form, there is no reference to "Civil War" debt. Several subsequent interpr…
I think that I got it. The 1m T-Bill yield has spiked because the market now thinks that 1m maturity will be AFTER the drop-dead date for debt-ceiling. And this expectation changed THIS week.
https://home.treasury.gov/resource-center/data-chart-cent…
Also, banks issue most preferreds (noncumulative kind), so preferred PFF has been trashed.
https://stockcharts.com/h-sc/ui?s=PFF&p=D&yr=1&mn=0&dy=0&id=p31136951271
What happened in the case of First Republic was that (large) uninsured depositors were made whole at the expense of bond holders; the equity will likely be wiped out even though FRCB (it replaced FRC) is trading at 32c. If there was a formal bankrup…
Stranger!
What does T-Bill 1m-3m inversion today of -50 bps mean?
https://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?type=daily_treasury_yield_curve&field_tdr_date_value_month=202305
If the high 1m-3m spread wa…
Not that unusual.
Fido also has day-limit-orders only for fractional shares (but not GTC). Keep in mind that to offer fractional shares, most brokers go through an intermediary.
https://www.fidelity.com/learning-center/trading-investing/fractional-…
First Jamie Dimon (after feasting on First Republic/FRC), and then Powell (yesterday), declared the end of regional banking crisis. Those pronouncements may have been very premature.
This AM, there are at least 3 banks on the verge of collapse - PA…
Your other post was on pension valuation which is a controversial concept. You don't need to do that at all.
Instead, do an income-gap analysis. Add up all of your estimated annual expenses; subtract your VA pension, Social Security (if any; you di…
First Republic Bank/FRCB is now trading in the Pink Sheets at about 40c. IMO, it is about 40c too high (-:).
https://finance.yahoo.com/quote/FRCB?p=FRCB&.tsrc=fin-srch
@hank, M* now backs out the shorting- and leverage-related expenses from the ER, and calls it adjusted-ER. Years ago, M* controversially stated only the adjusted ER, and argued vigorously about it, but since it started its own asset management busin…
Despite its sharp drop, the regional bank KRE is still +54.4% above its pandemic/2020 low. And now we are having a regional banking crisis, but this subsector hasn't yet reached panic-washout stage. I may take a bite at low-30s.
https://stockcharts.…
LCORX is long-short, so its ER also includes additional costs related to shorting. Still, its ER is high.
LCR is ETFs based and is long only. Inception was 1/6/20. ER is high for an ETF.
Surprisingly, their M* charts are similar since 1/6/20 (Stoc…
Yes, because they are differently titled. Individual, joint, IRA, Trust, business a/c have their separate FDIC coverages. I also noted here/elsewhere that CD1 w/POD1, CD2 w/POD2, etc have separate FDIC coverages - POD can be added to existing CDs.
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