I have to disagree with putting all of your $20k in stocks regardless of age. You need to be able to cover emergency expenses. If you’re young, I might go 25% bank account, 50% investment grade bonds and 25% stocks. @anon38180840
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Sounds like the $1.5 trillion is just to buy short term treasury bonds… yeah that is not going to do much for the stock market.
Stonks = economy
Cmon man did you even pass Trumponomics 101 at Trump University?
fucking gross man
Redacted for privacy.
Lol well that bounce didn’t last very long…
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Cool, thanks!
Just to be clear, I have an income stream and was looking at getting into stocks kinda as an aside to what I do with the 20k. I will definitely keep enough in an emergency fund that is easily accessible, but I might also get some funds into stocks.
Amazing that gold is still down 3%. 10 year treasuries at 0.7%
Probably there’s never been a better time to print money. Fed could probably buy a couple trillion in mid term negative interest rate bonds and barely move the inflation needle.
The amazing thing is that it wouldn’t even occur to them to use that money to build M4A or infrastructure, or even UBI, they would just find a bunch of ways to put it in the hands of corporations to use for stock buybacks and executive bonuses.
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Pretty much my approach. I’m riding it out hell or high water.
This is a foolproof idea, they should just keep printing trillions of dollars and the market will surely rebound.
Honestly as long as there is deflationary pressure they should print money. Deflation causes a feedback loop that is a much greater risk to society than inflation. If we start having bond defaults in the affected industries then deflationary pressure will only get worse. Along with a collapse in consumer spending as the TP hoarding winds down and all sorts of people not knowing when they will get their next paycheck, it would be perfect time to test run UBI.
I know this is unrealistic because Trump will find a way to bail out his donor’s and his own businesses and fuck everyone else, and Dems will go along with it to get a token amount of paid sick leave once all the negotiations are done.
Pension fund money must be going somewhere, but where?
Do you mean institutional pension funds? Like big plans like CALPERS? They aren’t really designed to sell out a ton of positions in a downturn, so they are closer to buy and hold investors. For example, a CALPERS would have an investment policy statement that wouldn’t allow them to do something crazy like call a meeting and decide to move into 100% cash for a while. Their investment managers may be doing some buying and selling, but within tolerances set out in the plan’s investment policy.
Also many of them have large allocations to private alternatives like private equity and real estate that don’t really allow them to withdraw their money, so they’re just riding those holdings and those holdings aren’t being marked to market anyway.
Edit: see page 45 of this doc;
Even if they wanted to bail on a bunch of assets they are capped at 1%+3% cash (“liquidity”).
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All companies are getting pushed underwater right now. If grue thinks his company is basically healthy, has cash on hand to weather the storm, etc. - might be good to stick with it over an index fund.
A repo is effectively a very short-term secured loan. I believe that the Fed only does repos against government-guaranteed securities, so there’s no credit risk. So the Fed is effectively saying that if you have a government bond (and are a big bank), they will be more willing to convert it into a short-term loan (and presumably will charge you less interest on the loan). Based on a short skim on the news, I didn’t see anything saying that they were accepting debt with credit risk as repo collateral.
If all companies are getting pushed underwater, why not invest his retirement savings in one of the options that isn’t going to lay him off if it has troubling pulling out of this?
Well that’s what I’m saying - only if he thinks the company is healthy and stands a better chance than the average company of weathering a few months of slack business. Just a thought.
I worked for Quest Diagnostics for 5 years. Until I dumped it Monday I’ve always held their stock because I feel like the company is really well run. And it was the best performer in 2001 after the dotcom crash. So I see it as a bit of a hedge. Interestingly though it’s been tanking since they announced they were doing C19 tests. But no news that I can find. So the super smart guys must know something is wrong. Or maybe that they’ll be forced to do the tests super cheap or something.
But basically my plan when I think we’re cratering is to pump it all in MSFT, DGX and a couple other companies I think will bob back to the surface faster - and leave it there.
Even in normal times, it seems like the only responsible use of 20k would be funding your emergency fund… It would be insane to take a flier on the stock market with your emergency fund when we might be heading into a prolonged recession.
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Ok, finally took some of the cash in my retirement accounts and bought into this dive. On my Vanguard one, I could only do funds, not ETFs - must have been how I set it up or something (or that I had to sell a money market fund and buy something else, I don’t know). That also resulted in having to meet purchase minimums, so I just put $1,000 into a target retirement fund.
On Schwab, I was able to do whatever the hell I wanted. I actually used Keed’s allocation as a baseline and then adjusted it to my preferences, adding a couple less risky things in small quantities. Still went mostly VTI and international stocks, but added a little treasury and international bonds.
Overall, as long as my allocation isn’t bonkers, probably doesn’t matter too much. It’s not like I just dropped a million bucks into the market or something. Now, the rest of my portfolio is way out of whack, but I’m loco.
Will buy more shit on another dip.