The OP was talking about a 401k loan as an investment, not as a means to survival. As an investment, a 401k loan is always a bad idea. Tax laws are written to ensure that pulling money out of a 401k will cost you money. In the long run, you are always ahead to leave an investment inside of your 401k...

I would never take out a 401k loan because I always keep plenty of cash on hand.

All loans are leverage and leverage usually makes for bad investments, as Uncle Harry taught us.

Fidelity fixed income page shows the following: US Treasury CUSIP # 9128285Q9, maturity 11/30/20, yield 0.313, bid 101.667, ask 101.871, yield to maturity 0.021. Depth of book shows recent transactions (more sells than buys). Yes, some T-bills can (and do) trade at a premium in the secondary market ...

The last thing I would do with T bill money is put it in a bank! Are you serious???? If we slide into a depression and banks start failing with the federal government already having spent trillions on stimulus packages, I'm not sure the FDIC guarantee is going to mean much. I had in mind watching t...

I just saw this notice on Fidelity's fixed income web page: icon-exclamation-yellowtriangle-1x Recent extreme market conditions have resulted in a lack of liquidity, wide spreads (the difference between the price a customer can buy and sell a bond), large swings in prices, and substantial increases ...

Interesting development.

This morning, I checked the Treasury yield curve at Fidelity and noted something I had never seen before-- no 3 month and no 6 month T-bills available.

With the 30 year T-bond yielding only 1.45%, the entire Treasury yield curve has a negative real yield right now.

I practice bank diversification too. 1. My local bank is not only FDIC-insured, it survived the Great Depression bank runs. 2. I know my local bank manager by name. He personally answers my (rare) phone calls and emails. 3. My local bank has my safe deposit box. I can get an appointment to open it w...

Any company that doesn't give you the option to have them call you back, instead of waiting on hold, has a 'tard-level of customer service. Kriegs, I would like to hear more followup details from you regarding the failed execution of the sale of some your LTTs at Vanguard, which you wrote about rec...

There are unresolved issues with the liquidity of the bond market, the extent of which are not entirely clear. See: Neil Irwin's article in the New York Times, "Something Weird Is Happening on Wall Street, and Not Just the Stock Sell-Off," March 12,2020. and Sonny Oh, "These are the '...

Seems like a lot better plan than buying "FDIC-backed" 5 year CDs, as some on this forum have recommended. I'm not sure what I've missed, but my CDs are doing fine, earning their 3% interest. And I could break them tomorrow and have the cash in my account in a few days, less 6 months inte...

This notice appeared on Fidelity's Fixed Income page today: "Due to the recent drop in interest rates, some Treasury Inflation-Protected Securities (TIPS) now have negative market yields. While active markets do exist for TIPS, pricing for these securities is not currently available on Fidelity...

I try not to rebalance from cash to one of the volatile assets. YTD, my bonds have risen from 23.4% to 30.6%. A rebalance from 35% seems still a bit off, but who knows? YTD, my stocks have fallen from 26.7% to to 19.5%. Likewise, a rebalance at 15% is possible, and I am prepared to meet it with a co...

What the fuck is this ridiculous bullshit A Fixed Income order to sell U S TREASURY BOND was canceled in your Vanguard Brokerage Account due to a change in the bid price available. If you wish to replace the order, you should call Vanguard at the number referenced below. Kriegs, Did your bond order...

Seems like a nice job opportunity for recently out-of-work stock brokers.

Mortgage rates follow moves in the current 10 year Treasury interest rate, which is 0.70%. This is a historic low. Bankrate.com latest national survey 15 year mortgage is 3.1%-3.2% . My mortgage rate has been 0.00% for the last six years. I paid the balance off when I could not find a breakeven refi...

sophie, For the most part, I agree with your thought experiment, but I think that a concrete example of a country that has dealt with negative interest rates for years might be useful. That country is Switzerland. 1. One result of years of negative interest rates is that Switzerland is now experienc...

I have also thought of upgrading my iPhone, iPad, and MacBook Air. Obviously not the same as building equity in my house, but I think it goes back to my larger points that 1) financial crises also represent opportunity, and 2) we don't have to accept a negative yield in interest rates on Cash.

So, what do we do if real interest rates all along the yield curve turn negative? 1. Use the 35% rebalance band: -Sell some 30 year T bonds if and when they reach that 35% rebalance band. That should generate a nice pile of cash. 2. Use a low interest rate environment to your financial advantage: -N...

Kriegsspiel,

If you don't mind my asking, what did you do with the proceeds? Buy 2050 dated T-bonds?? Buy beaten down stocks???

Vinny, 1. You are correct that one of the limitations of I-bonds is that they have annual limits. Therefore, building an I-bond ladder is part of a long-term strategy to follow for a number of years.That's why we call it "Deep Cash." 2. If you put TIPS in a tax deferred account to shield t...

Vinny,

TIPS have terrible tax treatment. I-bonds are tax deferred.

TIPS go negative in a deflation. I-bonds do not.

Now is a great time to start building your Deep Cash I-bond ladder. I-bonds currently yield 2.22%, easily beating everything from a 3 month T-bill to a 30 year T-bond.

Pet Hog, I think that there is a real world factor missing in your proposed thought problem: if one asset (LTTs) goes up, another in the HBPP (stocks or gold) eventually goes down. In my real world portfolio, bonds have gone up since the beginning of the year, but the value of my stocks have decline...

Right now, I am making money as interest rates fall and the price of my 30 year T-bonds skyrocket. If and when my 30 year T-bonds hit their 35% rebalance band, I will sell enough to restore a 4 x 25 balance. Seems like HBPP orthodoxy to me. So why would I need to go to a 3x33 minus LTTs? As for Cash...

I do better with my 35/15 rebalance bands than I do with my feelings about the bond market today.

We live in interesting times. I noticed today that the entire US Treasury yield curve, in real terms, has gone negative. After the FOMC's decision to reduce overnight rates, it was not really surprising that at the short end, the 3 month T-bill fell to just 0.42%. The long end of the yield curve, ho...