Stock market woes - have you checked your portfolio lately?

[m00m00m00]

Tech stocks look like they have been stupid ever since this ai temporary stock pumping started. Its been enough to even pull intel temporarily out of the gutter

(First actual stock comment by me in forever because i have no money to put into the market so i dont follow it)

 

[supersaiyenl4goku]

Tech stocks look like they have been stupid ever since this ai temporary stock pumping started. Its been enough to even pull intel temporarily out of the gutter

(First actual stock comment by me in forever because i have no money to put into the market so i dont follow it)

Hopefully it can stay up for at least a couple years to get me some value for my sign on RSUs! Was looking like I might almost get less than I should for a bit there.

 

[PoorPigg]

Over simplification:
The world GDP as of 2021 was estimated at $93.86T.
The world population as of 2022 was estimated at 7.9B People.
If we divide that equally, it would be $11,880.

Old analogy from who knows how many years ago:
If the world was comprised of 100 people and each person got one chicken, there would be wealth disparity.
70 people would immediately eat their chickens.
20 would keep their chickens and eat the eggs.
9 would breed the chickens and create more chickens.
1 would run the the chicken breeding.

 

[deleted-4439668]

Over simplification:
The world GDP as of 2021 was estimated at $93.86T.
The world population as of 2022 was estimated at 7.9B People.
If we divide that equally, it would be $11,880.

Old analogy from who knows how many years ago:
If the world was comprised of 100 people and each person got one chicken, there would be wealth disparity.
70 people would immediately eat their chickens.
20 would keep their chickens and eat the eggs.
9 would breed the chickens and create more chickens.
1 would run the the chicken breeding.

It is an oversimplification yeah, but I am firmly in the eating the eggs category. It raises a good point, to move up further I could find a way to breed the chickens and sell the eggs/spare chicks

I don’t think stocks are going to lift me into a new category. Should probably think about other investments

 

[PoorPigg]

"In March, the Consumer Price Index for All Urban Consumers increased 0.1 percent, seasonally adjusted, and rose 5.0 percent over the last 12 months, not seasonally adjusted. The index for all items less food and energy increased 0.4 percent in March (SA); up 5.6 percent over the year "

Food 8.5% increase over 12 months ending March 2023. https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category.htm

As of 11:28 am 12 April 2023 33,714.22+29.43 (0.087%) today
33,714.22-506.14 (-1.48%) past year

April 2023 CPI data are scheduled to be released on May 10, 2023, at 8:30 A.M. Eastern Time.

 

[deleted-4439668]

:/

 

[-Troopa-]

The value of Xbox Game Pass has never been more apparent.

 

[m00m00m00]

:/

Federal Reserve cuts rates to zero and launches massive $700 billion quantitative easing program

"The coronavirus outbreak has harmed communities and disrupted economic activity in many countries," the Fed said.

www.cnbc.com

Tbh i wonder if the cuts in march 2020 were an overreaction and shouldnt have dropped it that far, nor should they have left it that low that long

Response Lag: What It Is and How It Works

Response lag is the time it takes for monetary and fiscal policies to affect the economy once they have been implemented.

www.investopedia.com

Usually theres a time lag before the fed reacts but they put the cart in front of the horse those two times with all the factories shutting down and shelter in place

And then we got the housing shortage while rich ppl bought up and flipped homes (or are still squatting on them)

So my two questions are

1 did they cut rates too much too fast, with 2020 hindsight
2 did they take too long to raise rates again

 

[supersaiyenl4goku]

Yes

 

[PoorPigg]

"In April, the Consumer Price Index for All Urban Consumers increased 0.4 percent, seasonally adjusted, and rose 4.9 percent over the last 12 months, not seasonally adjusted. The index for all items less food and energy increased 0.4 percent in April (SA); up 5.5 percent over the year " BLS CPI

May 2023 CPI data are scheduled to be released on June 13, 2023, at 8:30 A.M. Eastern Time.

Food up 7.7% at home and up 8.6% away from home; Energy down 5.1% https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category.htm

DJIA 100 year chart

 

[sdevito]

Isn't the stock market supposed to go up during inflation?

 

[PoorPigg]

"The funded status of the nation's largest corporate pension plans lost momentum last year, ending a 10-year streak toward full funding. But the good news is that funded status still held steady throughout the year, in part due to weak investment returns that offset lower pension liabilities created by higher interest rates."


"According to the U.S. Census Bureau, over 5,000 public sector retirement systems exist in the U.S. Some of the roughly 300 state-administered plans and 5,000 locally-administered plans date back to the 19th century and each has evolved independently. Collectively, these plans have:

• $5.6 trillion in assets
• 15.0 million active (working) members and 11.7 million retirees
• $340 billion in benefit distributions annually" Public Plans Data

"People who don’t need Social Security benefits could opt out of receiving them in exchange for not being forced to take required minimum distributions." Source

 

[DevilDancer]

Good jobs report + debt ceiling deal = good day for stocks.

 

[PoorPigg]

Ouch, T-bills https://www.axios.com/2023/06/01/debt-ceiling-us-bond-market-news

Ouch, banks closings https://wolfstreet.com/2023/06/01/f...k-crisis-and-by-580-billion-since-qt-started/

Payment apps may not be covered by federal insurance https://www.consumerfinance.gov/abo...ular-payment-apps-may-lack-federal-insurance/

 

[blinkz0rz]

Fuck it, I'm just dumping money from my savings into REITs. Their return of 6-8% is better than the 4% my bank is offering. I've gone too long just stashing it there. Time for more growth income!

 

[PoorPigg]

"A global failure to curb carbon emissions will lead to rising debt-servicing costs for 59 nations within the next decade, according to a study that simulated the economic impact of climate change on current sovereign credit ratings.

Among them, China, India, the United States and Canada could expect higher costs as their credit scores fall by two notches under a "climate-adjusted" ratings system, the study published in the Management Science journal on Monday found." https://www.reuters.com/business/en...reigns-downgrade-risk-study-finds-2023-08-06/

"The study published in the Management Science journal on Monday found that climate change in effect of environmental pollution will lead to rising debt-servicing costs for 59 nations within the next decade.

Canada is also one of the countries that could expect higher costs as their credit scores fall by two notches under a "climate-adjusted" ratings system." https://www.geo.tv/latest/503708-us...sk-due-to-failure-in-cutting-carbon-emissions

 

[PoorPigg]

"A global failure to curb carbon emissions will lead to rising debt-servicing costs for 59 nations within the next decade, according to a study that simulated the economic impact of climate change on current sovereign credit ratings.

Among them, China, India, the United States and Canada could expect higher costs as their credit scores fall by two notches under a "climate-adjusted" ratings system, the study published in the Management Science journal on Monday found." https://www.reuters.com/business/en...reigns-downgrade-risk-study-finds-2023-08-06/

"The study published in the Management Science journal on Monday found that climate change in effect of environmental pollution will lead to rising debt-servicing costs for 59 nations within the next decade.

Canada is also one of the countries that could expect higher costs as their credit scores fall by two notches under a "climate-adjusted" ratings system." https://www.geo.tv/latest/503708-us...sk-due-to-failure-in-cutting-carbon-emissions

Pension funding climate change? https://impact.economist.com/sustai...nt-is-your-pension-funding-the-climate-crisis

 

[PoorPigg]

Ouch, T-bills https://www.axios.com/2023/06/01/debt-ceiling-us-bond-market-news

Ouch, banks closings https://wolfstreet.com/2023/06/01/f...k-crisis-and-by-580-billion-since-qt-started/

Payment apps may not be covered by federal insurance https://www.consumerfinance.gov/abo...ular-payment-apps-may-lack-federal-insurance/

Moody downgrading ratings for US banks https://www.cnbc.com/2023/08/08/moo...d-puts-some-big-names-on-downgrade-watch.html

Regulators auctioned off Silicon Valley Bank's wine collection at approx 60% of its appraised value source

 

[jabroni12]

Anyone looked into high yield savings account options recently? I started to a tiny bit this past weekend but need to stop being lazy and really dig in.

 

[-Troopa-]

Anyone looked into high yield savings account options recently? I started to a tiny bit this past weekend but need to stop being lazy and really dig in.

@AvocadoGenesis and I are using a particular service. It pays 4.80%. He can send you a referral code that gives both of you an extra 0.5% on top of that for six months. Getting set up was smooth.

 

[m00m00m00]

Ally Savings is 4.25, money market 4.40, no penalty cd 4.55 (not any downside to it other than not being able to withdraw for the first 10 days)

Capital one 360 is 4.30 and have physical locations, but it appears they have none on your state so w/e

Fidelity spaxx money market is 4.97

Short term treasury bond stuff

U.S. Treasury: Short Term Treasury Bills (4-Week-52-Week Maturity) Up to 5.50% Interest

Note: Rates are subject to change daily; rates are the daily secondary market quotations on the most recently auctioned Treasury Bills for each maturity tranche (4-week, 8-week, 13-week, 17-week, 26-w ...

slickdeals.net

Current fidelity brokered cd rates (low to mid 5s https://fixedincome.fidelity.com/ftgw/fi/FILanding#tbcds|treasury|cd-new-issue

 

[m00m00m00]

And fwiw I read some good things about the service troopa is alluding to, just based on random googling I'm doing right now for rates

 

[m00m00m00]

Ally has been alright to me, I convert it into no penalty cds, also reconvert my current ones into no penalty cds when the rates go up, its minimal work. Can have max 40 cds at any time

What I'm doing isn't the best option but I'm not making a big deal about it because it's such a miniscule amount of difference for me either way

Although I guess if I'm going to be lazy I'm passing up money by not sending it back over to my fidelity account if that's 5%

 

[AvocadoGenesis]

Anyone looked into high yield savings account options recently? I started to a tiny bit this past weekend but need to stop being lazy and really dig in.

And fwiw I read some good things about the service troopa is alluding to, just based on random googling I'm doing right now for rates

im using wealthfront. here's a ref link to get extra apy for 3 months

i think they are consistently near the top end of apy, but may not be the absolute highest. platform has been very easy to use which is good cause it doesnt do a whole lot, so whats there needs to work.

im just using it for cash savings, but i do have a friend that is using the automated investment tool. he didnt have any complaints; said it does what it needs to do and the fee was fine by him (.25%)

 

[supersaiyenl4goku]

Vanguard offers over 5% in their money market index fund on a brokerage account, but it’s not a cash account.

They have an invite only cash management account.

If you’re just getting started, Fidelity’s Cash Management Account or whatever it is, is the best offering available. You can put all your money into their money market index to get almost 5% and then it will just draw on it. It’s the most flexible high yield option that doesn’t require jumping through hoops and allows check writing and debit card I believe. (First hand experience with both the past few years)

I haven’t looked at Wealthfront in years, so I’d have to investigate. I will say Fidelity support / customer service is very good. Vanguard has fallen to crap over the years with many hour good times and uninformed employees.

 

[OneBigClam]

My bank is offering 5% six month saver certificates. We're going to take advantage of this.

 

[m00m00m00]

This took me awhile to research but I put it all together

Ally bank hysa 4.25, no penalty cd 4.55

Cap one 360 hysa 4.3

Wealthfront 4.8, 5.3 with AGs referral

Vanguard core position vmfxx 5.39

Fidelity core position Spaxx 4.96

Schwab has no yield in their core position sprxx

Vanguard treasury fund vusxx 5.16

Fidelity money market fund sprxx 5.03

Usfr ETF 5.29, sgov ETF 5.37. Invests in short term treasuries

Fidelity secondary market cds- Most cds are 5.1 to 5.3, tops out right now at 5.55 for one year chase bank.

Series 1 savings Ibond 4.30 (down from 6.89 last November), limit of 10k investment per year. I'm assuming the people who got this before just let it roll over to the new rate since its competitive with cds

 

[deleted-4439668]

11 Best CD Rates for Feb. 26, 2024: Up to 5.50% - NerdWallet

Check out the best CD rates you can find at top online banks and credit unions. See the highest CD interest rates.

www.nerdwallet.com

 

[m00m00m00]

Took me about an hour to research all that and type it out on my phone. Now I have a better understanding. I also read that vanguards customer support sucks compared to fidelity, but they yield more than fidelity with lower expense ratios.

The usfr/sgov ETFs are just popular at the moment because rates keep rising. As rates fall, then cds will be more sexy again. And ally hysa was good for at least 'something' (1 percent ish)when rates went to 0 if you didn't lock it up in cds/bonds beforehand

https://preview.redd.it/u1bfncisk56a1.jpg?width=922&format=pjpg&auto=webp&s=7592afa2d983de29f673bb511c84335eb0011109

www.reddit.com

 

[m00m00m00]

11 Best CD Rates for Feb. 26, 2024: Up to 5.50% - NerdWallet

Check out the best CD rates you can find at top online banks and credit unions. See the highest CD interest rates.

www.nerdwallet.com

I could have just pasted some comparison but I googled some bank vs brokered cd stuff, so I spent another 30 mins on this post lol. So here we go.


Bank cds vs brokered cds are different animals but from what I gathered, brokered cds seem to be a little better when you weigh the pros and cons. But its not universally better

Unfortunately I don't think you can search the fidelity secondary market without logging in, I think it made me. Everything short term was over 5.1, some 5.3, highest the aforementioned 5.55 that I listed in my earlier post. Many were already over 5 percent earlier this year but it seems the other options have closed that gap or exceeded it. With brokered cds, you also get the option of selling it on the secondary market instead of paying a penalty. But it won't always be possible to sell it. If rates go up a lot more then you might have to hold it until maturity instead of being able to sell it on the secondary market, whereas a bank cd will let you break it with a penalty. So the brokered cd you're basically giving up the flexibility to break it early if rates rise a lot after you buy it. I'm not sure how that secondary market selling thing goes, like how much does the rates need to go up for it to be unsellable. Otoh even then it might not be unsellable if you're close to maturity with it. But yeah, if you bought like a 3 percent brokered multi year cd a while back for example, you gotta hold it until maturity since nobodys gonna want that, whereas a bank cd you could break with 3ish months interest penalty, especially if you need the money.

Then again, I don't know what stops someone from just buying that 1 year 5.55 cd and then selling it as soon as rates go up again so you don't run into that problem.

Potential Downsides to playing that game:

-im guessing there's a lag time before the new cd is funded and you're only earning the spaxx 4.96% rate, which would erase some of the games. A google could probably answer that questions but I've googled enough right now

 

[m00m00m00]

To speak on cds personally, While 5.55 is kind of tempting, I really don't have money worth locking away, would have done the series 1 bond thing if I did have the money (granted it had the 10k per year limit)

To me it just seems like it's smart to go with a hassle free option like goku alluded to.

 

[m00m00m00]

Ok not going to be able to edit my above posts but I found some good news and some bad news.

Vmfxx is the vanguard equivalent of spaxx in the sense that it's the core position. I thought that was vusxx. The whole thing about money market vs treasuries should have tipped me off.


One downside to vmfxx (5.26) is that it's not state tax exempt like vusxx (5.16). But Texas has no state tax soooooooo yeah brb opening a vanguard account.

When rates start dropping then the money market stuff will drop immediately in a bad way and hysa will lag behind in a good way

Bad news: I said vmfxx is 5.39, its 5.26. So there's still room to chase with sgov at 5.37 or the aforementioned cds

 

[deleted-4439668]

Yeah doing your own research helps for understanding. Just posting that in case you wanted to save time

 

[m00m00m00]

Fixed the above comments on vmfxx

 

[m00m00m00]

Only eight states have no personal income tax:

Wyoming
Washington
Texas
Tennessee
South Dakota
Nevada
Florida
Alaska

In addition, New Hampshire limits its tax to interest and dividend income, not income from wages.

Til. Obviously Texas's tax burden is made up for with the 4th worst property taxes in the nation (altho a 100k homestead exemption is on the November ballot, up from 40k, which was only 25k before last year). And the 14th worst sales tax.

 

[m00m00m00]

Roth IRA stuff - I guess I should do this even if I don't have anything to contribute

 

[m00m00m00]

90 mins later, in not doing vanguard with the customer service being so bad

 

[m00m00m00]

Fidelity Cash management account is 2.72 interest for essentially a checking account like goku said. I should do that and do my credit card autpays out of that

 

[m00m00m00]

Fidelity: one stop shop - Bogleheads

www.bogleheads.org

Now I'm wondering if this means I can just leave the money in Spaxx and earn 5% interest on my checking account. As in, can the CMA just overdraft from spaxx

 

[m00m00m00]

You can just buy Spaxx with your CMA instead of my proposed idea, see the replies below. So basically 5 percent interest for a checking account, supports bill pay and all that

 

[m00m00m00]

@supersaiyenl4goku did you know about being able to buy spaxx and it will auto liquidate to make transactions?

 

[m00m00m00]

I now see that wealthfront is a checking account too, with that 5.3 percent promo. I thought it was just savings

 

[m00m00m00]

So I did this

Special offers | Fidelity

Take advantage of special offers when opening an eligible Fidelity account. Limited time only.

www.fidelity.com

Code is FIDELITY100

it's a 100 dollar bonus when you open a cash management account, which I was gonna do anyway

 

[east1226]

Only eight states have no personal income tax:

Wyoming
Washington
Texas
Tennessee
South Dakota
Nevada
Florida
Alaska

In addition, New Hampshire limits its tax to interest and dividend income, not income from wages.

Til. Obviously Texas's tax burden is made up for with the 4th worst property taxes in the nation (altho a 100k homestead exemption is on the November ballot, up from 40k, which was only 25k before last year). And the 14th worst sales tax.

I read somewhere that, per a study, the vast majority of Texans pay more in taxes than Californians do. That is mind boggling to me.

 

[m00m00m00]

Alright so for checking account purposes basically wealthfront is just a tiny bit lower than fidelity with cma spaxx, like 15 to 25 bps, but it's higher with the referral system, is FDIC insured unlike fidelity mm, and you don't have to play games with buying spaxx every time I deposit a paycheck (if I don't overdraft instead), and you can get money a little faster with not having to liquidate spaxx, if u had to xfer out.

Wealthfront has no paper check writing (im ignoring that USPS thing), fidelity cma does

Fidelity reimburses all ATM fees

Fidelity has physical locations

Might already use fidelity for investing (I'll prolly do the Roth IRA there at some point before next April)

From reddit: "i use Wealthfront as high yield savings and Fidelity for day to day cash / check / debit purposes. Requires a bit of planning on ACH, but works well for my needs."


So basically, its worth it to have both, but you can get by with one or the other. Main pros of wealthfront are higher apy with the referral, less work to get your rate without buying spaxx, and FDIC insurance so it's a true savings account.

Main pros of fidelity cma are paper check writing, physical locations, ATM reimbursement everywhere

 

[m00m00m00]

I read somewhere that, per a study, the vast majority of Texans pay more in taxes than Californians do. That is mind boggling to me.

I've heard that too. A 20 dollar phone bill is also 30 with taxes so I recommend carriers like visible and us mobile because they cover the taxes for you. Property taxes are a bitch. Talking 500-700 a month in county property taxes for a house that might only be worth 250k on the open market (before exemptions(. The central Appraisal districts are brutal on how they appraise the homes. 10 percent more every year without fail, because that's the most they cap it at with a homestead on it. Tldr: propertytaxes are high and they also jack up the appraisals a ton, often more than the home is worth. It's a funny money number


Granted taxes don't take into the total cost of living but yeah

 

[m00m00m00]

Basically I'm just going to do wealthfront and fidelity both but I haven't looked into it the customer support is good and if they have proper security

 

[m00m00m00]

Oh hey they actually use 2fa apps. fidelity is dumb and uses sms and that one device symnatec thing

 

[m00m00m00]

Seems some people do leave their CMA accounts empty and overdraft from spaxx in their main brokerage account. Or they just outright use their brokerage account to bill pay (paycheck direct deposited(

Either way I'll just try both.

 

[m00m00m00]

At least fidelity has its internal bill pay for backup but that's still weird that it didn't work with them normally. Wealthfront has no internal bill pay but a quick google suggests chase works