Posted on 03/07/2023 12:09:13 PM PST by Tell It Right
The 2-year U.S. Treasury yield on Tuesday topped 5%, and rose to its highest level since 2007, as investors assessed comments from Federal Reserve Chairman Jerome Powell who said the central bank may need to increase the pace of interest rate hikes again.
(Excerpt) Read more at cnbc.com ...
Longer term treasuries are supposed to have higher yields. Inverted as they are is usually a bad bear market sign.
Yep. I invested millions of funds for a city early in my career, and when the yield curves are inverted, you go for safety above all else. This is downright scary.
Until today I had no investments in equities. But I just now set up a purchase into a large-cap value fund in anticipation from a rebound from today’s bigly drop. But I won’t leave it there long.
I don’t think it’s safe to be in equities yet, if ever again.
We are about to experience a massive correction to rival all other recessions.
Long term I'm expecting it to drop at least 45% to be on par with the 2000 drop (49%) and 2007 drop (56%). Each of those took a long time (2 and a half years, and 1 and a half year) to go from ATH to market bottom, much like this bear seems to be doing.
I was out of equities in 2019 and 2020 expecting a long drop then too. But I jumped back in as soon as the S&P 500 dropped 30% in 2 months because it dropped quickly (30% in 2 months) and looked more like 1987 (quick drop of 30% then rebound) than the 2000-2002 and 2007-2009 bears.
Up and up.
(since 2007)
(This is downright scary)
Like I have said, here comes 2008 again
Do you remember the old Smith Barney commercial?
“People buy stocks with the expectation they will go up. Unfortunately they are buying them from sellers who expect them to go down.”
I do remember that commercial.
I think the S&P will lose a third of its value or more. Printing trillions in monopoly money is going to kill us.
Which is why Wall Street doesn't care if they go up or down, they make money on the trades either way.
I typically buy 8 week treasuries.
Gets me some of my tax dollars back.
I don’t do stock markets as I see that as a national casino,
only the house makes money.
Buy stock direct.
May I ask … are the interest from government treasuries TAXABLE?
That’s true normally, and may be true here, but its mainly inverted because the large bond investors don’t expect inflation to be anything close to as high as it is today in after 2-3 years rather than severe recession fears
Yes, unless you purchase them within a Roth IRA. For example, I don't purchase treasuries directly, I purchase a mutual fund of treasuries like PRULX. When I do that in my Roth IRA the treasury dividends are non-taxable (assuming I abide by the Roth IRA rules). I hear that you can buy individual treasuries within your Roth IRA but I've never done so.
But unless you purchase treasuries within a Roth type vehicle, then yes the interest is taxable.
Have been investing in 6 month t-bills every two weeks since September, beginning when 26 week interest was 3.576%. The initial bills are maturing this month, with re-investment for another six months at the higher rates. To date, working well.
True, but historically going back to about 1910, the market over the long haul has gone seriously, madly up, even with the crash of 1929 (barely visible as a blip on a long-term chart), 1987, and the Demented Pervert’s Crash.
“I don’t think it’s safe to be in equities yet, if ever again.
We are about to experience a massive correction to rival all other recessions.”
100% Agree
5.29% for 6 months? Wow, I’ll take that bet
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