David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Discussion of the Bond portion of the Permanent Portfolio

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mathjak107
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by mathjak107 » Sun Feb 21, 2021 8:56 am

There are just things very unlikely to occur in this country ..not that they can’t happen but the odds are so low you wouldn’t want to bet the same odds of them happening .

This country would stay out of deflation at almost all costs of higher inflation
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by dualstow » Sun Feb 21, 2021 8:58 am

Kevin K. wrote:
Sun Feb 21, 2021 8:47 am
... And IMHO it makes the case quite persuasively that allocating equal amounts of one's assets to hedge against economic conditions that are by no means equally likely to occur, and that entail very different costs to insure against, isn't agnostic - it's merely symmetrical (i.e. 4 x 25%).
I don’t put much money into flood insurance — zero, actually, because I’m not on a flood plain and i know it’s that unlikely that i’m going to experience flooding, whereas fires are fully covered.
I guess I need a good source of the odds of the economic conditions.
Via the vp, I tilt toward stocks. Maybe that’s close to a golden butterfly in disguise. If the Golden Butterfly were called the Monarch Butterfly, I’d call mine the Viceroy.
But, I do it only because I like stocks, i’m comfortable with stocks, and I’ve watched them go up nicely in my lifetime. Not very scientific. I need to read ‘Deep Risk’ and find that source. Maybe Bernstein knows something that Rosenberg doesn’t.

https://jasonzweig.com/shallow-risk-and ... the-woods/

So far Tyler's Golden Butterfly is the most elegant solution to these issues I've seen but there are obviously many other viable options.
Reading the link now...
Feels like the end of the everything rally.
In Britain they have made burglary a safe occupation. It's like OSHA for burglars.
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by mathjak107 » Sun Feb 21, 2021 9:08 am

It is important to just understand that throwing equal amounts of money in to outcomes that are anything but equal as far as playing out does not mean you are not betting on the under dog with the same amount of money as the favorite and that in itself is a pretty heavy bet on the under dog odds
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by dualstow » Sun Feb 21, 2021 10:17 am

I’m just glad you didn’t convince me in 2010 when I started buying those bonds.
I also had to ignore a close personal friend who thought I was nuts buying such an instrument with a yield of 4-4.75%.
Feels like the end of the everything rally.
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- Thomas Sowell on gun control
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by mathjak107 » Sun Feb 21, 2021 10:52 am

We can all cherry pick a time frame for anything in the past as an example for something that did well ...but times change and conditions change and what was may be no more ...we can even pull out 1929-as a depression time frame .

I don’t think odds are good putting the same money on a depression as prosperity ...despite the fact I pull a time frame out .

So despite what we can drag up from the past odds are quite different making our bet on it quite different and not equal ..

To be equal would take a probability study and then adjust the money to match
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by dualstow » Thu Feb 25, 2021 1:39 pm

More adventures in bond buying.

There's no auction today, but I went to the secondary market for treasurys at Vanguard and plugged in the CUSIP of one of my recent buys. Peeked at yield-to-worst. Put in an order for 10, pressed the Calculate button.

Saw that the yield-to-worst has grown worse because of my low quantity. But, it was still ok. Am I willing to hold on to this instrument for at least 10 years, come hell or high inflation? Yes. A few more are-you-sure button clicks and now I own some more treasury bonds.
Feels like the end of the everything rally.
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- Thomas Sowell on gun control
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by mathjak107 » Thu Feb 25, 2021 3:08 pm

dualstow wrote:
Thu Feb 25, 2021 1:39 pm
More adventures in bond buying.

There's no auction today, but I went to the secondary market for treasurys at Vanguard and plugged in the CUSIP of one of my recent buys. Peeked at yield-to-worst. Put in an order for 10, pressed the Calculate button.

Saw that the yield-to-worst has grown worse because of my low quantity. But, it was still ok. Am I willing to hold on to this instrument for at least 10 years, come hell or high inflation? Yes. A few more are-you-sure button clicks and now I own some more treasury bonds.
CAll me foolish but. I couldn’t help but add more to Tlt to bring it back up to the 600k leve near the low ..closed at 606,043 .00 so it bounced a little from the worst .
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by dualstow » Thu Feb 25, 2021 3:20 pm

I really need to shore up my pp long bond %. It's timing in that I made no move when it sank below the 15% band*, but I've been waiting for a week like this to do it.

*Due to the fact that I have year-2040ish bonds, not due to the yieldRise/priceDrop.
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by Cortopassi » Thu Feb 25, 2021 3:26 pm

Funny that there is so much angst after a 20% PP year and we are down about 1.5-2% so far.

At least we are getting a higher dividend! :P
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by dualstow » Thu Feb 25, 2021 3:37 pm

Cortopassi wrote:
Thu Feb 25, 2021 3:26 pm
so much angst
Mainly from our daytraders, though, right? There's no ulcer poll, but I think a lot of us feel fine.
Feels like the end of the everything rally.
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- Thomas Sowell on gun control
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by buddtholomew » Thu Feb 25, 2021 3:39 pm

mathjak107 wrote:
Sun Feb 21, 2021 9:08 am
It is important to just understand that throwing equal amounts of money in to outcomes that are anything but equal as far as playing out does not mean you are not betting on the under dog with the same amount of money as the favorite and that in itself is a pretty heavy bet on the under dog odds
This should be sticky!
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by mathjak107 » Thu Feb 25, 2021 3:50 pm

Cortopassi wrote:
Thu Feb 25, 2021 3:26 pm
Funny that there is so much angst after a 20% PP year and we are down about 1.5-2% so far.

At least we are getting a higher dividend! :P
It may be closer to down over 3% now . Wasn’t the pp up about 15% last year ?

I will look later
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by dualstow » Thu Feb 25, 2021 3:57 pm

buddtholomew wrote:
Thu Feb 25, 2021 3:39 pm
mathjak107 wrote:
Sun Feb 21, 2021 9:08 am
It is important to just understand that throwing equal amounts of money in to outcomes that are anything but equal as far as playing out does not mean you are not betting on the under dog with the same amount of money as the favorite and that in itself is a pretty heavy bet on the under dog odds
This should be sticky!
Right that's what Kevin K said, that it wasn't so much agnostic as merely symmetrical. My follow-up question to that was: What if you don't know what the odds are? Or who are we supposed to look to for those odds? So far that question remains unanswered.
Feels like the end of the everything rally.
In Britain they have made burglary a safe occupation. It's like OSHA for burglars.
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by Xan » Thu Feb 25, 2021 3:59 pm

dualstow wrote:
Thu Feb 25, 2021 3:57 pm
buddtholomew wrote:
Thu Feb 25, 2021 3:39 pm
mathjak107 wrote:
Sun Feb 21, 2021 9:08 am
It is important to just understand that throwing equal amounts of money in to outcomes that are anything but equal as far as playing out does not mean you are not betting on the under dog with the same amount of money as the favorite and that in itself is a pretty heavy bet on the under dog odds
This should be sticky!
Right that's what Kevin K said, that it wasn't so much agnostic as merely symmetrical. My follow-up question to that was: What if you don't know what the odds are? Or who are we supposed to look to for those odds? So far that question remains unanswered.
I would think the default assumption would have to be that the odds are 50/50 for any PP asset to go up or down. If it were CERTAIN that long bonds were going to crater, they would have already, right? The current price is what the market thinks is fair.
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by buddtholomew » Thu Feb 25, 2021 4:02 pm

Risk parity tells us about the odds.
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by Cortopassi » Thu Feb 25, 2021 4:06 pm

mathjak107 wrote:
Thu Feb 25, 2021 3:50 pm
Cortopassi wrote:
Thu Feb 25, 2021 3:26 pm
Funny that there is so much angst after a 20% PP year and we are down about 1.5-2% so far.

At least we are getting a higher dividend! :P
It may be closer to down over 3% now . Wasn’t the pp up about 15% last year ?

I will look later
My variant seemingly is doing a bit better than the standard 25/25/25/25.
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Re: David Rosenberg: Long Treasuries Are Still The Safest Asset Around

Post by Cortopassi » Thu Feb 25, 2021 4:07 pm

dualstow wrote:
Thu Feb 25, 2021 3:37 pm
Cortopassi wrote:
Thu Feb 25, 2021 3:26 pm
so much angst
Mainly from our daytraders, though, right? There's no ulcer poll, but I think a lot of us feel fine.
Agreed. But mj is really good at making me question all my decisions!
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