Today we got the ‘official’ jobs report which showed that we added 177,000 new jobs in April. Are government layoffs and tariff related jobs getting creamed? Nope – at least not yet. Predict the future at your own risk.
I was thinking this morning about all the nervous nellies who have already sold everything and buried the money in a mayonnaise jar in the backyard–every time we have some big market down days and lots of uncertainty we lose investors to the all cash scenario–this is almost always a mistake. The exception to this scenario this time is we do have alternatives in CDs and money markets which at least are paying a 4%-4.25% rate–certainly much better than the ZERO we were being paid for years and years.
Lots and lots of uncertainty ahead for sure, but today I think I will be adding at least 1 issue to the hiding spot list–1 for sure will be a hiding spot with a high yield–over 8%. Like always I like to eat my own cooking and will likely initiate a new position in this issue. This issue will be a bit riskier but as they say ‘no risk no reward’.
Warren announces retirement ! Now that’s news. Expect never ending praise from…..those who hate capitalism!!
Expect non stop articles of praise…,,coming from people who hate capitalism!!
Sorry, what are you on about?
Last week there was the Oligarchy Tour. Blasting billionaires. Insurance companies. And much praise/sympathy for Luigi Mangione. Listen for those who spoke sympathetically to these ideas….. to now praise warren.
Few remember he actually ran the huge trading floor for Solomon Brothers for 1 year!!
CHARLES M; You can do that BUT you have to pay the TAXES first.
For those of you that hedge, what are your ‘preferred’ methods? With the nine day streak I considered buying SPY puts but opted for QQQ puts instead. Have a great weekend–Cheers!
Before the NFP number I was thinking bad number = long rates lower. Got the opposite on both. IRX reacted by rising, indicating rate cut not expected on May 7.
My guess is if the stock index rally continues, the long-rate rally will too. Could get interesting.
Payday that seems odd, do you have a link showing this?
Very odd to see Warren Buffet 100% cash, as he is not a timer. The economy seems to be perceived like Jethro Tull’ s ‘ Locomotive’ . Unless some pulls a lever at the switch station we are headed for a crash💥. I suspect there will be another ‘blink’ and the brakes put on soundly before the train jumps the tracks. Have cash nearby!
Payday that seems odd, do you have a link showing this?
Charles, It’s odd because it’s false. Just more non factual nonsense.
Pig I didn’t think so. He isn’t one to panic and holding a railroad, insurance and utilities I see no reason for him to sell.
Payday—Buffet is actually around 50% equities on 12/31/2024 with most of the balance in true cash and treasury bills.–Per the 10K here
https://www.sec.gov/ix?doc=/Archives/edgar/data/0001067983/000095017025025210/brka-20241231.htm
> The exception to this scenario this time is we do have alternatives in CDs and money markets which at least are paying a 4%-4.25% rate–certainly much better than the ZERO we were being paid for years and years.
Agreed, I don’t think hiding out in the money markets is so bad right now. I’m okay with missing out on some (potentially illusory) gains in the short term.
I’ve never seen a “potentially illusory” gain that couldn’t be realized if one so desired. With so many investors disbelieving this rally, it might still have some legs.
https://www.aaii.com/sentimentsurvey
I’m as conservative as they come — typically 75% short term Treasury Notes, but this sentiment setup makes some swing trading very compelling.
https://www.youtube.com/watch?v=0akBdQa55b4
I chickened out and did some profit taking too, until the next drop if there is one. Putting spare cash in 6% safe funds such as Gabelli preferreds, GAM-B, GGN-B etc even the safer banks such as WFC-L. Earn higher interest, the price could move around somewhat, maybe down but maybe up. I figure if they go down then the issues I’m buying back cheaper went down more.
Good Post for sure. The problem with putting all of your wealth into CD’s is that 4% CD is going to be taxable if its in a personal taxable account. My Federal rate is 37% & Nebraska’s rate is 5.84% so as they say back of the envelope math says you get to keep a little over half. So if you truly want to grow you’re wealth you’re going to need some blue chips, preferreds, decent bonds, etc. In the Old Days I would buy Nebr. Double Tax Muni’s but now the coupons are so ridiculously low I don’t even bother.
Chuck P if you are in the 37% tax bracket, aren’t you also paying 3.8% on your net investment income?
STEVE; I fully admit that I have a high flalooten CPA that keeps me legal. I paid well over $250K in taxes to the Fed. & Nebr. for my 2024 return which made me actually “ill”. So I would imagine I paid that 3.8% you are referring to. I started taking pretty big positions in EPD & MPLX a little over 3 years ago but it has not saved me by any means. What really is killing me is that damn RMD. For those of you that have not gotten to that stage in your life yet you will find it very PAINFUL.
Chuck, I admit I don’t have any understanding about converting holdings in an IRA to a Roth but is that an option for you?
If Chuck is retired already, then I would assume it wouldn’t do any good unless he finds a way to get to the 35% tax bracket. 🙂
The key is to convert traditional IRA funds when you’re in a lower tax bracket than when you initially contributed. For example, while working, my contributions are taxed at 35%, but in retirement, I expect to drop to the 32% bracket as my earned income decreases. By converting during retirement, I’ll pay 32% tax on funds that would have otherwise been taxed at 35% – creating a 3% tax savings on the converted amount.
Mr. C I am still working a couple days a week, I like talking to the customers across the country.
Mr C and Chuck P-
Of course, before doing a conversion to a Roth, you must First, take an RMD (if applicable)–the money or stocks will go to your taxable acct, with tax due. Then, when that transfer is done, you can do a conversion. No substitution.