Is the stock market going to tank?

[Hott Butt Mud]

Anyone else here have a bunch of PLTR shares with a $20 cost basis? I feel like the Oracle of Wall Street right now.

[jono]

The effects of yield-curve management are limited given high deficits and elevated inflation. Add to that the threat of tariffs and worse the threat of a capital wars if foreign central banks start selling treasuries in response to tariffs. Treasury and the Fed might be able to make some short-term impact but it is mostly contingent on a host of other policy consequences.

IMS last time it took a minute for demand to outstrip resale supply, but weeks not years. This year's 10Y is next year's 9Y, so unless there's a whole lot of old 20Y and 30Y out there the Fed can make it happen.

Makes me think now might be a good time to buy 10Y to sell when rates fall. Which would help by soaking up some supply.

What is it they say about fighting the Fed again? Do it? Don't do it?

Honestly, the most likely reason for long rates to stay up is the Fed growing a backbone. Which kind of says a lot.

[MultiVerse]

Powell said we're close to the neutral rate given current macro/fiscal conditions so I'm not sure what fighting the Fed means in this environment. They cut 100 basis points last year and long term yields rose. That hasn't happened in nearly fifty years. I do agree bonds are looking more attractive given high economic growth expectations priced into stocks. Although, I think rates remain higher as long as inflation remains elevated. So far there hasn't been much progress on an annual basis from 2023 to 2024 with CorePCE only falling from 3%-to-2.8%. Macro, and as deficits rise increasingly fiscal, conditions are what drives asset & bond prices.

[CascadeLuke]

Anyone trade VIX? Maybe I’m out to lunch but the only confidence I have in the market - is volatility. Have been holding UVIX mostly waiting for a huge spike while ripping profits on opportunities, then reentering lower.
With all the sketchy things that could cause it to 2-4x within hours. Hitting 52 lows rn is absurd. Keep adding but I’m more overweight than orange man.
Aug 5 on yen carry trade it 4x overnight. I’ve got a mouthwatering exit ladder that would buy me a Canadian ski condo if that type event happened again.

[liv2ski]

4matic: Blended portfolio:

BINC
PDI
HYS
PAXS

YTD is nowhere close to 8%.

[4matic]

4matic: Blended portfolio:

BINC
PDI
HYS
PAXS

YTD is nowhere close to 8%.

lol.. ok man. Whatever you say

[4matic]

Anyone trade VIX? Maybe I’m out to lunch but the only confidence I have in the market - is volatility. Have been holding UVIX mostly waiting for a huge spike while ripping profits on opportunities, then reentering lower.
With all the sketchy things that could cause it to 2-4x within hours. Hitting 52 lows rn is absurd. Keep adding but I’m more overweight than orange man.
Aug 5 on yen carry trade it 4x overnight. I’ve got a mouthwatering exit ladder that would buy me a Canadian ski condo if that type event happened again.

At some point the vix* products might have a big rally. The problem is there is so much option volume now these derivative formulas get skewed.

[J. Barron DeJong]

lol.. ok man. Whatever you say

What am I missing here? Looks like the average return of those four funds over the past year is 3.525%, and that's being dragged up PAXS's 8.25%, but that's a leveraged fund so that risk should be factored in, it's not really 'safe', right?

[4matic]

That’s the return. Return plus YIELD is twelve percent.

I did the math and the combined YIELD of my mix is a little over eight percent

You don’t get high YIELD without risk. I know that.

You guys are confusing yield, return, and total return. Look it up.

Emoji hell makes it hard to talk about percentages

[4matic]

So I’m clear here about my risk. PDI and PAXS are levered high yield funds. My expectation of total return over ten year plus time frame is five percent. The reason I use these high yield levered funds is that it’s an easy way (for me) to manage withdrawals. Right now it throws off 2 percent excess income that I keep in cash in case I need it and I don’t have to sell anything.

IF, big if, the levered funds have a big RETURN year and interest rates are still adequate I would sell some to preserve capital.

Also, if stocks have a big down period of twenty to thirty percent I would reallocate to that depending on where I’m at. For now I don’t have to do anything but spend distributions.

[4matic]

PDI is a lightning rod for a lot of reasons. But, even if PIMCO cut the dividend to match its Undistributed net investment income (UNII) it would still yield eleven percent. Note that PDI has never cut the dividend in twelve years.

[J. Barron DeJong]

That’s the return. Return plus YIELD is twelve percent. I did the math and the combined YIELD of my mix is a little over eight percent You don’t get high YIELD without risk. I know that. You guys are confusing yield, return, and total return. Look it up. Emoji hell makes it hard to talk about percentages

I wouldn't say I'm confusing it, I just don't know how those funds work.
So that yield gets paid out to the ETF holder, not reinvested in the fund, I take it?

[4matic]

I started investing for income about three years ago and was a few months early so took a big capital drawdown. As of now my capital drawdown is less than three percent. And the way I’ve looked at this is ten percent swings either way are largely irrelevant to the payout…as long as they pay. For me, a few more years of higher for longer is great. The entire portfolio of bonds would be rolled in every one of my funds to bonds which were financed or re-financed at higher rates.

[4matic]

I wouldn't say I'm confusing it, I just don't know how those funds work.
So that yield gets paid out to the ETF holder, not reinvested in the fund, I take it?

Dividends and bond yields are never included when you look at the simple return of a stock, fund, or etf. There’s return, return at nav, yield, total return, total reinvested return. There’s is no one answer.

I don’t re-invest and that’s always a choice. But, there are also special dividends, year end capital gains returns, etc. There haven’t been many of those since 2021 but BINC paid a sixty cent special in December for a ninety cent total payout. Almost a full two percent.

[Kevo]

CPI, core CPI and PPI came in hot and no one seems to give a shit.

I still think stagflation is a possibility.

[Brock Landers]

Anyone else here have a bunch of PLTR shares with a $20 cost basis? I feel like the Oracle of Wall Street right now.

My cost basis on PLTR is 11 and change. Bought late 2021/early 2022. 20 is good!!

[4matic]

Lots of layoffs hitting. If it’s true HUD is laying off five thousand and gov laying off all current probationary hires.

[shroom]

it’s been a white collar slaughter for almost [emoji638] years now. this is a knife in the back

[liv2ski]

Thanks for the explanation as I was wondering WTF you were going on about. I know nothing about bond funds, but am looking for 5%+ safely guaranteed in this environment.

4matic: "That’s the return. Return plus YIELD is twelve percent.

I did the math and the combined YIELD of my mix is a little over eight percent

You don’t get high YIELD without risk. I know that.

You guys are confusing yield, return, and total return. Look it up.

Emoji hell makes it hard to talk about percentages"

[4matic]

Fixed annuity pays five percent plus now

[rod9301]

Fixed annuity pays five percent plus now

Right, but what you're buying is the credit with of the issuer

Sent from my moto g 5G using Tapatalk

[4matic]

Right, but what you're buying is the credit with of the issuer

Sent from my moto g 5G using Tapatalk

Same as any credit issue. Private or public

[civilcoconut]

Lots of layoffs hitting. If it’s true HUD is laying off five thousand and gov laying off all current probationary hires.

It’s going to be 10’s of thousands based on what I’m reading.

[4matic]

Two hundred thousand probationary workers?

[civilcoconut]

Two hundred thousand probationary workers?

Potentially. Sometimes long term federal employees go into a probationary status when they move job series, switch agencies or become a supervisor. They are supposedly excluding certain public safety, national security, military support and cybersecurity positions.