I'm worried about stagflation and am selling all my bonds tomorrow.

Discussion of the Bond portion of the Permanent Portfolio

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StinkyToes
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by StinkyToes » Wed May 06, 2020 8:59 pm

San Francisco Bay Area home prices still rising:

https://mortgage.originalandsafe.com/ev ... me-prices/

"Median sale prices in the region increased 1.5%, led by year-over-year gains in the counties of Alameda (5.1%), San Mateo (6.5%) and Santa Clara (4.8%), according to a Zillow analysis. Contra Costa County home prices grew 1.9% from the previous March."
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by pmward » Thu May 07, 2020 11:40 am

StinkyToes wrote:
Wed May 06, 2020 8:59 pm
San Francisco Bay Area home prices still rising:

https://mortgage.originalandsafe.com/ev ... me-prices/

"Median sale prices in the region increased 1.5%, led by year-over-year gains in the counties of Alameda (5.1%), San Mateo (6.5%) and Santa Clara (4.8%), according to a Zillow analysis. Contra Costa County home prices grew 1.9% from the previous March."
SF houses rising. Water wet. This has been going on for decades and still has not had any real impact on inflation.
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Kriegsspiel
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by Kriegsspiel » Thu May 07, 2020 12:19 pm

pmward wrote:
Thu May 07, 2020 11:40 am
StinkyToes wrote:
Wed May 06, 2020 8:59 pm
San Francisco Bay Area home prices still rising:

https://mortgage.originalandsafe.com/ev ... me-prices/

"Median sale prices in the region increased 1.5%, led by year-over-year gains in the counties of Alameda (5.1%), San Mateo (6.5%) and Santa Clara (4.8%), according to a Zillow analysis. Contra Costa County home prices grew 1.9% from the previous March."
SF houses rising. Water wet. This has been going on for decades and still has not had any real impact on inflation.
Well, maybe it does if you want to live in SF :P

Then again, think about how much cheaper those tech companies would be to operate if they didn't concentrate themselves in such an expensive location. Maybe Stripe could charge a lower fee if they didn't locate in downtown San Francisco. Maybe Google could charge less for ads if they didn't locate in San Jose? Nothing about those places is required to run a tech company; it seems they could be much more profitable if they weren't there.
There's this very disturbing set of studies where about half the articles printed in Science and Nature magazines, the two leading publications, involved experiments that could not be repeated by anybody.
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Tortoise
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by Tortoise » Thu May 07, 2020 1:33 pm

It's not just San Francisco and Silicon Valley. Someone in my family bought a house in Maryland last week. She said 32 potential buyers signed up for private showings of the house on the first weekend. Out of those, 13 of them submitted offers. This was during a lockdown.

She said the large number of showings and offers was because most of the people who live in that part of Maryland work for the government, so they're still getting paid. Real estate conditions are heavily local.
Joe is just Biden his time now.
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by StinkyToes » Thu May 07, 2020 4:35 pm

Tortoise wrote:
Thu May 07, 2020 1:33 pm
It's not just San Francisco and Silicon Valley. Someone in my family bought a house in Maryland last week. She said 32 potential buyers signed up for private showings of the house on the first weekend. Out of those, 13 of them submitted offers. This was during a lockdown.

She said the large number of showings and offers was because most of the people who live in that part of Maryland work for the government, so they're still getting paid. Real estate conditions are heavily local.
Was it Bethesda or Chevy Chase? ;D
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Kriegsspiel
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by Kriegsspiel » Thu May 07, 2020 4:41 pm

I, for one, think it's really cool that Maryland named a municipality after Chevy Chase.
There's this very disturbing set of studies where about half the articles printed in Science and Nature magazines, the two leading publications, involved experiments that could not be repeated by anybody.
- Peter Thiel
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Tortoise
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by Tortoise » Thu May 07, 2020 5:10 pm

StinkyToes wrote:
Thu May 07, 2020 4:35 pm
Was it Bethesda or Chevy Chase? ;D
Neither -- Silver Spring. But I guess they're all pretty close to each other?
Kriegsspiel wrote:
Thu May 07, 2020 4:41 pm
I, for one, think it's really cool that Maryland named a municipality after Chevy Chase.
Naming a municipality after an asshole... interesting concept. ???
Joe is just Biden his time now.
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Kriegsspiel
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by Kriegsspiel » Thu May 07, 2020 5:18 pm

Tortoise wrote:
Thu May 07, 2020 5:10 pm
Naming a municipality after an asshole... interesting concept. ???
Wasn't it named after the front hole? It wasn't called National Lambutthole, you know.
There's this very disturbing set of studies where about half the articles printed in Science and Nature magazines, the two leading publications, involved experiments that could not be repeated by anybody.
- Peter Thiel
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by StinkyToes » Tue May 12, 2020 11:56 am

The latest consumer price index update is out: https://www.bls.gov/news.release/cpi.nr0.htm

What I got right:
- food at home prices jumped in April, rising 2.6% month over month.
- medical care services prices are still rising, up 0.5% month over month.
- shelter prices did not fall (flat month over month).
- energy prices plunged, as expected.
- transportation prices plunged, as expected. Who cares. Nobody is flying.
- long-term treasury prices are roughly 4-5% lower today than when I sold.

What I got wrong:
- apparel prices plunged more than I expected (down 4.7% month over month)
- the bond market yawned at the report -- apparently traders had already factored in the big increase in food prices.

All in all I'm not upset with my little attempt at market timing. I did prevent a 4-5% decline in my LTT holdings. At the same time, I do not feel I hit the bullseye and gains were probably mostly luck. Clearly, there is no panic about stagflation and/or rising food prices. Accordingly, I plan to reinstate my long LTT position within the next day or two.
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by ochotona » Tue May 12, 2020 12:36 pm

StinkyToes wrote:
Tue May 12, 2020 11:56 am
The latest consumer price index update is out: https://www.bls.gov/news.release/cpi.nr0.htm

What I got right:
- food at home prices jumped in April, rising 2.6% month over month.
- medical care services prices are still rising, up 0.5% month over month.
- shelter prices did not fall (flat month over month).
- energy prices plunged, as expected.
- transportation prices plunged, as expected. Who cares. Nobody is flying.
- long-term treasury prices are roughly 4-5% lower today than when I sold.

What I got wrong:
- apparel prices plunged more than I expected (down 4.7% month over month)
- the bond market yawned at the report -- apparently traders had already factored in the big increase in food prices.

All in all I'm not upset with my little attempt at market timing. I did prevent a 4-5% decline in my LTT holdings. At the same time, I do not feel I hit the bullseye and gains were probably mostly luck. Clearly, there is no panic about stagflation and/or rising food prices. Accordingly, I plan to reinstate my long LTT position within the next day or two.
Sometimes you get lucky. But trading bonds generally is very hard
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Dieter
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by Dieter » Tue May 12, 2020 1:58 pm

Finance porn, but thought of you...

Prices are tumbling at an alarming rate

https://www.cnn.com/2020/05/12/economy/ ... index.html
pmward
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Re: I'm worried about stagflation and am selling all my bonds tomorrow.

Post by pmward » Tue May 12, 2020 3:17 pm

ochotona wrote:
Tue May 12, 2020 12:36 pm
StinkyToes wrote:
Tue May 12, 2020 11:56 am
The latest consumer price index update is out: https://www.bls.gov/news.release/cpi.nr0.htm

What I got right:
- food at home prices jumped in April, rising 2.6% month over month.
- medical care services prices are still rising, up 0.5% month over month.
- shelter prices did not fall (flat month over month).
- energy prices plunged, as expected.
- transportation prices plunged, as expected. Who cares. Nobody is flying.
- long-term treasury prices are roughly 4-5% lower today than when I sold.

What I got wrong:
- apparel prices plunged more than I expected (down 4.7% month over month)
- the bond market yawned at the report -- apparently traders had already factored in the big increase in food prices.

All in all I'm not upset with my little attempt at market timing. I did prevent a 4-5% decline in my LTT holdings. At the same time, I do not feel I hit the bullseye and gains were probably mostly luck. Clearly, there is no panic about stagflation and/or rising food prices. Accordingly, I plan to reinstate my long LTT position within the next day or two.
Sometimes you get lucky. But trading bonds generally is very hard
Yes. Of all the charts I analyze, bonds are by far the most difficult to get a read on.
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