Treasury Direct account security discussion at Bogleheads

Discussion of the Cash portion of the Permanent Portfolio

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jhogue
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Re: Treasury Direct account security discussion at Bogleheads

Post by jhogue » Mon Oct 21, 2019 8:47 am

What makes you think that Fidelity and Vanguard are somehow safer than the U.S. Treasury?
“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!"
jacksonm2
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Re: Treasury Direct account security discussion at Bogleheads

Post by jacksonm2 » Mon Oct 21, 2019 3:58 pm

jhogue wrote:
Mon Oct 21, 2019 8:47 am
What makes you think that Fidelity and Vanguard are somehow safer than the U.S. Treasury?
If this question is directed at me I thought I gave the reason in my post. I have no idea which of those three are the most or least hackable. I just believe that if I was hacked I would rather deal with Fidelity or Vanguard than the U.S. Treasury.
grapesofwrath
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Re: Treasury Direct account security discussion at Bogleheads

Post by grapesofwrath » Wed Oct 23, 2019 8:36 am

I would think Treasury Direct is safer than Vanguard/Schwab/Fidelity because it has virtually no customer service.
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ochotona
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Re: Treasury Direct account security discussion at Bogleheads

Post by ochotona » Wed Oct 23, 2019 5:21 pm

grapesofwrath wrote:
Wed Oct 23, 2019 8:36 am
I would think Treasury Direct is safer than Vanguard/Schwab/Fidelity because it has virtually no customer service.
Interesting perspective. I've gone round and round in my head on this matter, and I think if you use the 2FA (I send 2FA emails to Hotmail), and if you vigorously defend said 2FA channel (I use 2FA on my 2FA, and it ain't a phone, it's an authenticator app), and if you change the password every once in a while (16 characters for me, upper / lower / numbers /symbols), and if you print out proof of ownership, you won't have problems.
jacksonm2
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Re: Treasury Direct account security discussion at Bogleheads

Post by jacksonm2 » Fri Oct 25, 2019 2:35 pm

grapesofwrath wrote:
Wed Oct 23, 2019 8:36 am
I would think Treasury Direct is safer than Vanguard/Schwab/Fidelity because it has virtually no customer service.
Exactly my point but we apparently see things in reverse as to whether or not that is a good thing.
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ochotona
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Re: Treasury Direct account security discussion at Bogleheads

Post by ochotona » Fri Oct 25, 2019 3:00 pm

jacksonm2 wrote:
Fri Oct 25, 2019 2:35 pm
grapesofwrath wrote:
Wed Oct 23, 2019 8:36 am
I would think Treasury Direct is safer than Vanguard/Schwab/Fidelity because it has virtually no customer service.
Exactly my point but we apparently see things in reverse as to whether or not that is a good thing.
Each way to keep cash has different risk. Money in the bank, money in T-Bills is exposed to negative interest rate risk! And risk of bank default and FDIC is not sufficiently funded.

It's wise to spread your risks around. Don't avoid I-Bonds because they have some risk, use them because they have risk which aren't like the risks you face in other places.
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jhogue
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Re: Treasury Direct account security discussion at Bogleheads

Post by jhogue » Fri Oct 25, 2019 6:22 pm

Exactly.
Just as in the Lehman Brothers bankruptcy in 2008, it will be impossible in advance to predict where, when, and how the next liquidity crisis will strike. The point of holding T-bills in a brokerage, I bonds in a safe deposit box or TreasuryDirect account, and a stash of greenbacks somewhere nearby is to diversify your Cash holdings before that moment comes when liquidity seems to be evaporating everywhere.

I sleep better at night knowing I have spread the risk around.
“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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