I’m quite anxious to hear what the Fed Chair has to say at the conclusion of the FOMC meeting midday.
Just watching stocks and bonds one has to believe there will be no extreme reaction after the announcement and press conference–not that it makes any difference to me and probably most of you—you’re either in and trying to earn some income or you’re not. We are all struggling to earn a decent return in this continuing low coupon environment.
The yield curve has flattened quite a lot with the short end of the curve moving significantly higher while the 10 year drifts with not much change on the week–at about 1.57% versus last Friday’s close at 1.56%. Forecasting a slowing economy–of course it is slowing–how could it not be slowing?
So we wait and watch.
There are also EE bonds and I know don’t laugh the interest rate is .1. But if you hold them 20 years or your estate, at year 20 you auto get 3.5%. Not to bad if you look at the 20 year Treasury. Plus the tax is deferred until you cash.I know you loose to inflation, but still it will be there.
Don’t know about the rest of you but I am still unloading common shares. Good bye BK. Held for more then a year and up like 80%. I worked too hard for the original investment money to see ridonkulous quick gains like that somehow disappear. I don’t care if the S&P peaks at 5100+ next year or whatever. That is only 10% higher. Crazy world right now. Not much makes sense.
Makes sense to me… This whole market’s been fueled by ridiculously cheap money courtesy of the Fed, and now that the first signs of that coming to an end are actually upon us, bang! zoom! To the moon, Alice. It was a month ago I decided to sell my original investment amount in RILY at 59.25. Thankfully that was only about 25% of what I own… It’s at 78 now… are we in dotcom 2000 zone now????
I’ve seen RILY climb on announcements in the past for the big specials, but this one is crackers. People paying $20 more than what it was recently priced at ( or even more). Yes, they had a good qtr, but it will fall more than the $4 in divs coming up. Then- time to reload.
I’m down to my last few shs, and will be out by Fri. – for the 3d or 4th time in a yr or so. $80 anyone?
https://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html
Speaking about the federal reserve, on Treasury Direct, Buying Series I Savings Bonds, the interest rate for Series I bond for November 2021 to April 2022 is
seven and 1/8 percent (7.12%) Does anyone have any experience they would like to share regarding their experience with I bonds and/or Treasury Direct
website? I have not paid any attention to treasury bills and I bonds for investments since I have focused for many years on preferred stocks and baby bonds. However, with inflation, the i bonds are offering a solid return for at least six months and if inflation continues for a longer period.
followthemoney–check the sandbox page–there was substantial discussion somewhere recently.
https://innovativeincomeinvestor.com/sandbox-page/
Tim and those who have educated me on this site on I bonds.
A very big THANK YOU!!!!
The TreasuryDirect site works just fine. You transfer money in and out electronically. You have to hold I-bonds for at least a year, and if you cash them in before 5 years, you lose 3 months in interest. No much more to it than that!
Agreed with James. For a government site, it was actually quite good (mostly). Create your account (hardest part, but not hard), then transfer in money. Set up separate account for spouse, if desired. Limit $10k/person/year. But January 1 is coming up soon.
For “zero-risk” (not that there is such a thing), but let’s call it really low risk, how could you beat 7.12% for 6 months, and probably some decent rate for the 6 months after that?
Which 3 months of interest do you lose on early withdrawal? If I buy now, I earn 6 months of interest at 7.12%, then suppose for the next 6 months I earn at 2.5%. My pre-penalty yield would be 4.81% after 1 year excluding compounding. If I lose the last 3 months of interest (at 2.5%), my yield would be 4.18%. If I lose the first 3 months of interest (at 7.12%), my yield would be 3.03%. Either way I don’t like the thought of locking my money up for a year at these levels.
JDC, this may answer your question:
“The penalty is interest earned in the last three months the bonds are owned. If the rate for the seventh through twelfth months is still significantly higher than CD rates and the rate for the six months after that drops low enough, it may make sense to keep the bonds for 15 months instead of 12. That way one earns higher interest for months 9 through 12 which would otherwise be forfeited, and the loss of interest for months 13 through 15 will be relatively small. Investors initially planning to hold their bonds for only 12 months should keep an eye on future rates to figure whether a 15 month holding will make sense for them.”
Here is a good introduction to I bonds:
https://keilfp.com/blogpodcast/i-bond-rate-november-2021-to-april-2022/
I have to laugh every time I use the Treasury Direct website. It is a horrible, clunky mess. Definitely the worst financial website I have ever seen. However, it does work.
BUT… no friggin ads to put up with 😉
followthemoney, someone posted here in III the following link a few days back. I suggest going there as it provides what seems to be the “best step by step guidance.”
https://thefinancebuff.com/how-to-buy-i-bonds.html
best regards, no No. 12
When the market jumps up or down based on words or news blurbs, I’m inclined to play the opposite side