Cash is King!

Discussion of the Cash portion of the Permanent Portfolio

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eufo
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Cash is King!

Post by eufo » Sat Feb 03, 2018 7:06 am

Friday was a great example of why we hold cash. It's not much comfort when the portfolio is shrinking, but it's important to consider that it would have been worse had we been more exposed. In fact, it's likely it may continue on Monday.

Seeing both equities and bonds fall has been expected for awhile. But, the fall in commodities (especially gold) makes me wonder if there's some deleveraging to happen in that asset class as well.

Either way, love your cash!
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ochotona
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Re: Cash is King!

Post by ochotona » Sat Feb 03, 2018 2:12 pm

Cash is really king right now.
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Re: Cash is King!

Post by dualstow » Tue Sep 25, 2018 2:59 pm

I was listening to a 1978 clip of Lou Adler, who died earlier this year, just to hear his voice and wow-
listen to the bit about treasuries! Start at 2:45 (just a 6-second blurb)
https://youtu.be/PTKDEPwfEas?t=2m45s
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eufo
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Re: Cash is King!

Post by eufo » Tue Sep 25, 2018 6:14 pm

Seeing this thread dug up made me take a look to see how the various portions of the PP are doing... Cash has remained King for this time period.

Image
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Mr Vacuum
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Re: Cash is King!

Post by Mr Vacuum » Wed Sep 26, 2018 7:09 am

Is the green line the dollar index $USD? If so I question its use in this comparison, it being a ratio against other currencies, not a model of a cash instrument. It may reverse course just as quickly at any time, as it did in the six months or so after the 2016 election. Try SHV or SHY. Either is still a fine anchor.
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eufo
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Re: Cash is King!

Post by eufo » Wed Sep 26, 2018 9:27 am

Mr Vacuum wrote:
Wed Sep 26, 2018 7:09 am
Is the green line the dollar index $USD? If so I question its use in this comparison, it being a ratio against other currencies, not a model of a cash instrument. It may reverse course just as quickly at any time, as it did in the six months or so after the 2016 election. Try SHV or SHY. Either is still a fine anchor.
It is. Nevermind, I guess. I'd prefer cash under the mattress over SHV, but that's just me, I suppose. I still like cash over all else but gold at the moment.
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Don
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Re: Cash is King!

Post by Don » Tue Oct 16, 2018 11:16 am

I have a 5 year CD coming due that paid me 2% interest. Where would be a good place to roll this into right now?
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dualstow
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Re: Cash is King!

Post by dualstow » Tue Oct 16, 2018 11:30 am

Don wrote:
Tue Oct 16, 2018 11:16 am
I have a 5 year CD coming due that paid me 2% interest. Where would be a good place to roll this into right now?
How about 2-year treasury notes.
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barrett
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Re: Cash is King!

Post by barrett » Tue Oct 16, 2018 12:56 pm

dualstow wrote:
Tue Oct 16, 2018 11:30 am
Don wrote:
Tue Oct 16, 2018 11:16 am
I have a 5 year CD coming due that paid me 2% interest. Where would be a good place to roll this into right now?
How about 2-year treasury notes.
Check out the treasury yield curve here:

https://www.treasury.gov/resource-cente ... data=yield

I've just been doing a one year ladder. So far every time I have a T-Bill come due (every three months as I have four rungs on my ladder), I've been able to replace it with a higher yielding bill. Of course the trend in rates could reverse itself but the Fed is planning to keep raising for now.
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jhogue
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Re: Cash is King!

Post by jhogue » Tue Oct 16, 2018 12:58 pm

If possible, why not split your purchase? Also, given the recent rise in interest rates and inflation, I think the better deals are to found right now in shorter maturities than your 5 year bank CD.

Consider:

1. One year US Treasury bill @ 2.70%.

2. Series I savings bond, currently @ 2.62%. (Wait to purchase until after 11/01/18, since the fixed rate may well rise.)
“Groucho Marx wrote:
A stock trader asked him, "Groucho, where do you put all your money?" Groucho was said to have replied, "In Treasury bonds", and the trader said, "You can't make much money on those." Groucho said, "You can if you have enough of them!"
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Re: Cash is King!

Post by dualstow » Tue Oct 16, 2018 1:10 pm

And if you're worried about inflation, even Vanguard's Treasury money market is not a bad deal, provided you can meet the minimum. I have my core cash there.
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barrett
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Re: Cash is King!

Post by barrett » Tue Oct 16, 2018 3:08 pm

dualstow wrote:
Tue Oct 16, 2018 1:10 pm
And if you're worried about inflation, even Vanguard's Treasury money market is not a bad deal, provided you can meet the minimum. I have my core cash there.
dualstow, can you tell me what the expense ratio is on that Vanguard fund? Was reading up on a similar fund at Fido but it seemed expensive. And you have check writing "privileges" on that account as well, right?
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