Gyroscopic Investing

Posted: **Wed Aug 10, 2022 11:37 am**

: 09951338-B813-47B7-B2E3-B3DE8F0FE5E6.jpeg (407.57 KiB) Viewed 13960 times

I believe these are in local currency terms, but are “real”.

Posted: **Wed Aug 10, 2022 11:40 am**

I don’t have data for the Russian stock market prior to 1917, but I think I can tell you how it did after that.

Posted: **Wed Aug 10, 2022 5:23 pm**

I Shrugged wrote: ↑Wed Aug 10, 2022 11:40 am I don’t have data for the Russian stock market prior to 1917, but I think I can tell you how it did after that.

The Soviets absolutely loved gold (really they did). Non-senior communist gold holders, not so much. Oftentimes there was a lead for gold exchange which was kinetic in nature.

Throw in China as well, both stock markets zeroed out. If you stayed in either country riches and life got very random.

Posted: **Wed Aug 10, 2022 10:45 pm**

MangoMan wrote: ↑Wed Aug 10, 2022 6:07 pm
Kbg wrote: ↑Wed Aug 10, 2022 5:23 pm If you stayed in either country riches and life got very random.
I wonder if 50 years from now, people will be saying the same thing about the US, Canada, western Europe and AU/NZ....

Dial the Fox news and right wing websites down pug and I'll bet your happy factor and optimism outlook goes through the roof. (And I'd say the same thing to lefties watching and reading doom porn on MSNBC and left wing websites.)

Posted: **Thu Aug 11, 2022 5:53 am**

Kbg wrote: ↑Wed Aug 10, 2022 5:23 pm
I Shrugged wrote: ↑Wed Aug 10, 2022 11:40 am I don’t have data for the Russian stock market prior to 1917, but I think I can tell you how it did after that.
The Soviets absolutely loved gold (really they did). Non-senior communist gold holders, not so much. Oftentimes there was a lead for gold exchange which was kinetic in nature.

Throw in China as well, both stock markets zeroed out. If you stayed in either country riches and life got very random.

In other words,

You got to know when to hold 'em
Know when to fold 'em
Know when to walk away
And know when to run

I hope you’ve got gold
In another country
Because if you have some
Life could still be fun

Posted: **Thu Aug 11, 2022 10:44 am**

But teh libs is worst! They voted for Joe Biden and didn't let Trump stay in office even though he tried to steal th eelection!

Posted: **Thu Aug 11, 2022 10:49 am**

Desert wrote: ↑Thu Aug 11, 2022 9:36 am
MangoMan wrote: ↑Thu Aug 11, 2022 7:06 am
Kbg wrote: ↑Wed Aug 10, 2022 10:45 pm
MangoMan wrote: ↑Wed Aug 10, 2022 6:07 pm
Kbg wrote: ↑Wed Aug 10, 2022 5:23 pm If you stayed in either country riches and life got very random.
I wonder if 50 years from now, people will be saying the same thing about the US, Canada, western Europe and AU/NZ....
Dial the Fox news and right wing websites down pug and I'll bet your happy factor and optimism outlook goes through the roof. (And I'd say the same thing to lefties watching and reading doom porn on MSNBC and left wing websites.)
That's what they told the Jews in Weimar in 1930.
If you want to avoid 1930's style fascism, don't vote for the candidates that the swastika-flying right wing extremists love.

Or who have an affinity for yellow stars, sickles and hammers surrounded in red.

pug...don't do a mathjack. Life is too short to be perpetually unhappy, cranky and worrying about stuff we will all most likely be long dead for.

Posted: **Thu Aug 11, 2022 10:58 am**

Back to topic, LTTs are still within band; haven't changed band.

Did just buy some T-Bills (better rates than online saving account)

Posted: **Thu Aug 11, 2022 11:11 am**

I'm with Pug. You see the Bolshevik mentality on display in many nations' capitals and intelligentsia right now. The Nazi nuts are just fringe crazies with no traction. They've always been there and probably always will be. OTOH, the Bolshevik thinkers are actually in positions of power and influence. Basically if you don't agree with them, and if you are important enough, they are looking to take you down.

Maybe Pug and I can see it because we are prone to looking for it. No matter, it's there.

In real time, it's like the burning alive of almost 100 men, women, and children in Waco. Everyone thought they deserved it. Sadly, I did. We are taught to trust the government and revile those whom the government and its dissemblers say are bad. I'm sure a lot of people trusted the various bad leaders and movements of the past, which we now see for what they were.

I don't obsess over it. I can't speak for Pug. But I do notice when something quacks like a duck.

Okay I think we've trashed this thread. I'm out.

Posted: **Thu Aug 11, 2022 11:33 am**

Dieter wrote: ↑Thu Aug 11, 2022 10:58 am Back to topic, LTTs are still within band; haven't changed band.

Did just buy some T-Bills (better rates than online saving account)

Yes, it would be nice to be talking about Treasuries in this thread! Ditto for me with purchasing T-Bills. The last couple of years lulled me to sleep regarding cash positions because rates were so low. Now I am picking up T-Bills with any "extra" cash. Just going out to a year on the maturities so far with rungs of nine months, six months & three months as well.

Might start going further out. Just waiting for Desert to roll up his shirt sleeves like Cramer and start making weird sounds as he glares into the camera and shouts at us to "Go longer!!!"

Posted: **Thu Aug 11, 2022 11:37 am**

Sounds good, back to treasuries.

I've been holding to what I normally do. Buying STTs on TD and it has been pleasant watching the rates go up each month for the most part. I'd like to see a return to market based pricing vs. the Fed hovering everything up to keep them artificially low. My other commitment to treasuries (sort of) has been in TMF which has been pummeled this year and has been quite unpleasant. See the VP thread I just posted to.

Posted: **Thu Aug 11, 2022 12:16 pm**

I have to assume that high-yield savings account interest rates will increase again soon to catch up with T-Bills.

Posted: **Thu Aug 11, 2022 2:31 pm**

One credit union is listing 4% for 5 year cd.

https://www.depositaccounts.com/cd/5-year-cd-rates.html

At some point these rates start looking really tasty.

4% is 40k income per year on 1m deposit.

Posted: **Thu Aug 11, 2022 5:42 pm**

Xan wrote: ↑Thu Aug 11, 2022 12:16 pm I have to assume that high-yield savings account interest rates will increase again soon to catch up with T-Bills.

I'd hope so, but, they seem to be going up slower than I expected (including CDs, although I've only checked those rates at Ally)

1.6% at Ally for Savings; 2.14% for 4-Week T-Bill. Not huge, but still 0.54% [Edit: ~33% better!], and that's at the short end.

Luckily, T-Bills are pretty quick once get over the analysis paralysis and fear of doing something for the first time (and the nudge from one of these threads to, like, check those rates)

(ack; I still need to make time to consolidate a couple of retirement accounts)

Posted: **Thu Aug 11, 2022 6:50 pm**

whatchamacallit wrote: ↑Thu Aug 11, 2022 2:31 pm One credit union is listing 4% for 5 year cd.

https://www.depositaccounts.com/cd/5-year-cd-rates.html

At some point these rates start looking really tasty.

4% is 40k income per year on 1m deposit.

4% interest also happens to be a -4.5% real return (current CPI is 8.5%). Meaning you're effectively losing $45k in purchasing power per year on a $1M deposit.

Just keeping it real.

Posted: **Fri Aug 12, 2022 5:41 pm**

Tortoise wrote: ↑Thu Aug 11, 2022 6:50 pm Just keeping it real.

Pun intended I hope!

Posted: **Wed Aug 17, 2022 1:09 pm**

blue_ruin17 wrote: ↑Thu Jul 28, 2022 10:29 pm
For me, LTTs are a buffer against deflationary shocks (2008, 2020, et al.) and an insurance policy against a Second Great Depression that lasts a generation.

I would be a fanatical gold-bug if the PP didn't protect me from myself so well, so for me to admit that a protracted deflationary regime card remains in the deck says a lot.

I personally cannot buy into the long deflation arguments, if only because I think our politicians and central bankers would throw any amount of money they could at such a situation in order to keep prices moving upwards. Plus we do have a citizenry who (although they claim they hate higher prices) are very, very used to seeing their house and stock portfolios go up every year. The natives in his country would become restless with severe asset deflation.

Posted: **Wed Aug 17, 2022 1:42 pm**

jalanlong wrote: ↑Wed Aug 17, 2022 1:09 pm I personally cannot buy into the long deflation arguments, if only because I think our politicians and central bankers would throw any amount of money they could at such a situation in order to keep prices moving upwards. Plus we do have a citizenry who (although they claim they hate higher prices) are very, very used to seeing their house and stock portfolios go up every year. The natives in his country would become restless with severe asset deflation.

I tend to agree. I think this is a case where paying attention to certain schools of economic thought that support deflationary monetary policy can do more harm than good when applied to reality, because it's just not supported by the debt-based fiat currency regimes we live under. The system doesn't work when there's persistent deflation, which is why we never have it and "deflationary shocks" in our world tend to be extraordinarily short.

You don't have to like debt-based fiat currency regimes to acknowledge the machinery of how they work and adapt accordingly if you happen live under one.

Posted: **Sat Sep 03, 2022 10:28 am**

Although most people on the forum now tend to dismiss Budd, either I missed or there never was a great response to his opinion. If we are actually in a multi-year trend of slowly rising interest rates, what will keep the PP or any Risk Parity portfolio from having the losses we have seen this year happening every year until it ends?

The PP is supposed to be for money you can't afford to lose. That was it's mantra. Well this year it has lost -12% and a lot more in real terms. Maybe T Bills or cds are for money you can't afford to lose?

Posted: **Sat Sep 03, 2022 11:52 am**

jalanlong wrote: ↑Sat Sep 03, 2022 10:28 am Although most people on the forum now tend to dismiss Budd, either I missed or there never was a great response to his opinion. If we are actually in a multi-year trend of slowly rising interest rates, what will keep the PP or any Risk Parity portfolio from having the losses we have seen this year happening every year until it ends?

The PP is supposed to be for money you can't afford to lose. That was it's mantra. Well this year it has lost -12% and a lot more in real terms. Maybe T Bills or cds are for money you can't afford to lose?

I think if rates continue to rise as part of a multi-year trend, there is absolutely no investment vehicle that will save you this time around. In fact, investments will be the least of your concerns at that point.

Also, I think that the incredible (and inexplicable) growth in asset value in the middle of a global pandemic that (rightly or wrongly) shut down entire economies for months is somewhat distorting everyone's opinion of things. Yes, the PP has lost value, just like everything else, but if you compare it back to pre-pandemic, things aren't terrible, even on an inflation adjusted basis. Things look alot worse right now because we're coming down from mid-pandemic highs that we really had no business ever touching. I urge patience as people evaluate things, even over the next several years. I think we're a long, long way away from the dust settling from the covid shutdowns. What's the end result? I don't know and neither does anyone else. Continued rampant inflation, long-term massive deflation, recessions/depressions, housing collapses, energy shortages, etc. etc. There's no shortage of potential outcomes and no way to know which asset classes will outperform or underperform moving forward.

Posted: **Sat Sep 03, 2022 1:00 pm**

dockinGA wrote: ↑Sat Sep 03, 2022 11:52 am
I think if rates continue to rise as part of a multi-year trend, there is absolutely no investment vehicle that will save you this time around. In fact, investments will be the least of your concerns at that point.

Also, I think that the incredible (and inexplicable) growth in asset value in the middle of a global pandemic that (rightly or wrongly) shut down entire economies for months is somewhat distorting everyone's opinion of things. Yes, the PP has lost value, just like everything else, but if you compare it back to pre-pandemic, things aren't terrible, even on an inflation adjusted basis. Things look alot worse right now because we're coming down from mid-pandemic highs that we really had no business ever touching. I urge patience as people evaluate things, even over the next several years. I think we're a long, long way away from the dust settling from the covid shutdowns. What's the end result? I don't know and neither does anyone else. Continued rampant inflation, long-term massive deflation, recessions/depressions, housing collapses, energy shortages, etc. etc. There's no shortage of potential outcomes and no way to know which asset classes will outperform or underperform moving forward.

I think this is a very valid point. Just stepping back and looking at it through a simpleton's analysis, there is no real reason for why asset values rose as precipitously as they did in 2020. In fact, that they rose at all is questionable. A part of me thinks that increase was illusory, and I tried to resist the temptation to normalize it or congratulate myself for it, but doing so isn't easy. As though the Fed threw money at the economy to prevent a crisis and temporarily rose the tide for everyone and now they're basically sucking it all back like a massive vacuum.

There's a similar simple view I have of consumer inflation. For so many years our inflation levels were non-existent, sometimes seemingly negative. Certainly in relation to the rest of the world. So stepping back and looking at a longer term picture, what's happening now could just be normalization to mean after a period of having it artificially good. That and remove the factor related to pandemic supply chain disruption.

So +1 on patience and +1 on things could go in any number of directions, impossible to predict at this moment. I share a lot of Budd's pain. I started out with the PP in 2012 so now have a 10 year history and it just hasn't been that great, much lower than the PP averages before I started.
I absolutely have concerns about the PP looking forward. It's a dog with it's own set of fleas. If someone knows of a dog with fewer fleas, I'm all ears.

Posted: **Sat Sep 03, 2022 1:12 pm**

glennds wrote: ↑Sat Sep 03, 2022 1:00 pm
dockinGA wrote: ↑Sat Sep 03, 2022 11:52 am
I think if rates continue to rise as part of a multi-year trend, there is absolutely no investment vehicle that will save you this time around. In fact, investments will be the least of your concerns at that point.

Also, I think that the incredible (and inexplicable) growth in asset value in the middle of a global pandemic that (rightly or wrongly) shut down entire economies for months is somewhat distorting everyone's opinion of things. Yes, the PP has lost value, just like everything else, but if you compare it back to pre-pandemic, things aren't terrible, even on an inflation adjusted basis. Things look alot worse right now because we're coming down from mid-pandemic highs that we really had no business ever touching. I urge patience as people evaluate things, even over the next several years. I think we're a long, long way away from the dust settling from the covid shutdowns. What's the end result? I don't know and neither does anyone else. Continued rampant inflation, long-term massive deflation, recessions/depressions, housing collapses, energy shortages, etc. etc. There's no shortage of potential outcomes and no way to know which asset classes will outperform or underperform moving forward.
I think this is a very valid point. Just stepping back and looking at it through a simpleton's analysis, there is no real reason for why asset values rose as precipitously as they did in 2020. In fact, that they rose at all is questionable. A part of me thinks that increase was illusory, and I tried to resist the temptation to normalize it or congratulate myself for it, but doing so isn't easy. As though the Fed threw money at the economy to prevent a crisis and temporarily rose the tide for everyone and now they're basically sucking it all back like a massive vacuum.

There's a similar simple view I have of consumer inflation. For so many years our inflation levels were non-existent, sometimes seemingly negative. Certainly in relation to the rest of the world. So stepping back and looking at a longer term picture, what's happening now could just be normalization to mean after a period of having it artificially good. That and remove the factor related to pandemic supply chain disruption.

So +1 on patience and +1 on things could go in any number of directions, impossible to predict at this moment. I share a lot of Budd's pain. I started out with the PP in 2012 so now have a 10 year history and it just hasn't been that great, much lower than the PP averages before I started.
I absolutely have concerns about the PP looking forward. It's a dog with it's own set of fleas. If someone knows of a dog with fewer fleas, I'm all ears.

Budd and Mathjak aren't always wrong in what they say. They just blabber on and on about the same things, with no additional information to add to any discussion. Their reservations about the PP are the same reservations anyone should have about it, and they've reached their own conclusions about what to do about it (most of which is whining and moaning, apparently, and trolling the PP message board for some reason). I think most people's contention with them is that their conclusions are deeply flawed or baseless, and repeated ad nauseum.

Posted: **Sat Sep 03, 2022 2:50 pm**

You gentlemen are making good sense. Dock, I think you’ll find that if you give Mathjak less attention, he’ll give you less attention. Or, at the very least, if you want to call him out on some of his posts, maybe you could leave out the “troll” part. He can leave out the “dick” part, and all that will be left is a good healthy argument. Sound fair?

Posted: **Sat Sep 03, 2022 3:20 pm**

dualstow wrote: ↑Sat Sep 03, 2022 2:50 pm You gentlemen are making good sense. Dock, I think you’ll find that if you give Mathjak less attention, he’ll give you less attention. Or, at the very least, if you want to call him out on some of his posts, maybe you could leave out the “troll” part. He can leave out the “dick” part, and all that will be left is a good healthy argument. Sound fair?

Sounds fair to me, but he can continue to call me whatever he wants, his name calling is the least troublesome thing, to me, about his posts. If I ever do tire of his childish "smears" I can always retaliate with "I'm rubber, you're glue" or something else equally childish.

The most troubling thing is there's no such thing as a good healthy argument with someone who, instead of rebutting other's comments in an otherwise good discussion, launches into tirades that are at best tangentially connected to the discussion at hand, and then rinses and repeats with each new post, never actually replying to anyone's rebuttals of their comments, just steering the discussion further and further from the original topic of conversation.

It is what it is. I'll leave off calling him a troll and reblock all of his posts. Hopefully it won't be like last time I tried that, when each thread ceased to be readable with over half of the posts blocked.

Posted: **Sat Sep 03, 2022 3:26 pm**

Just so not every post is off topic: yes, I'm still sticking with Treasurys as per my sig.

As for the name calling, anger, and tirades, I honestly just don't understand. This is an Internet forum where we discuss, post interesting things, and sometimes share things going on in our personal lives.

Why get so hot and bothered about it? When someone on this forum gets testy with me I just laugh. It's bloody amusing. Why get angry? They're just strangers on the Internet. Who cares?

Gyroscopic Investing

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