Early Retirement Extreme Forums

Finally a decent drop. The question is whether the market will only go down just low enough for the Fed to shelve the rate hike, or whether it will go down far enough to bring the big money back in.

It would be strange to see a correction right before an election. Well, any election but this election.

The Feds kicked the can further down the road again.

There was no way they were going to raise before this election. They would be unlikely to do it during a normal election let alone the circus that is currently going on.

Do you think they'll raise after? I mean right after?

Ha...it would be a way to stick it to Trump if he won.

I kind of do think they will raise right after. The only way I don't see that is if the numbers really do deteriorate more. My take is they want to do it at least once this year and other factors have got in the way. They have to want to placate the "YOU MUST RAISE NOW!" camp, while still acknowledging the weak recovery.

They probably aren't consciously trying to stick it to Trump, but unconsciously if the decision is close it could be a deciding factor.

I've dusted off my trading fund and I've been building a shopping list. Any thoughts about DB? Will it just drag everything down a bit? I wonder if all the negative bank talk (WF/DB) will bring down prices on some better names like GS. I'd love to see GS get down to a 2% yield ($130ish). Any German companies worth watching? I own a lot of SAP that I'm letting DRIP.

I bought my usual vix play the other day, mostly as a way to ease back into the market. It's up so I'll probably sell it today. I don't like holding it over the weekend. Too much can happen.

@jenny
More than likely DB will put some downward pressure on other financial institutions, including US ones. Though, it's probably not a Lehman event.

Commerzbank is doing it's part too by making those big job cuts.

My question is do the OPEC nations actually follow through on the oil production cuts? I'm doubtful.

I personally would not touch DB, the fine they got from the USA could wipe them out even if reduced.
I don't think they're going to close shop but I would not risk it, I'd rather buy some other more solid banks that are down too.
I encourage you to take a look at Mediobanca, it's Italy's GS (well, that a bit like saying "it's India's Ferrari" but you get the idea).

Regarding OPEC, I'm not sure if they're going to follow through, but in general I really do not see how a cartel will continue to hurt itself indefinitely in a sort of pissing contest.
I have a lot of Royal Dutch in my portfolio and I'm very happy to let it compound at the current 8% dividend level.

Few reasons I'm not a big fan of banks or insurance companies going forward:

1. not much public support after 2008 such that governments will have less political will to save them in a crisis
2. index investing and low interest rates has shifted middle/upper class capital from savings to brokerages
3. facing disruption from tech sector: p2p lending, startups using machine learning, better automation, or better statistics for investing/lending/insurance, crypto-currency or services built on crypto-currencies like prediction markets or digital contracts, and a "kickstarter" mentality gaining popularity (Tesla pre-sales..) and maybe "angel investing" becoming more accessible
4. one can only imagine what is on the banks' balance sheets in this environment of all time high valuations and over-valued gov debts

Nasty feedback loop between a, b, and d.

Of course some companies could utilize the new tech or do some acquisitions to not get left in the dust.. but ultimately margins will shrink. Maybe someone like GS is smart enough to see all this stuff as well and take action?

Sold TWTR Wednesday, which was unbelievably prescient and mostly luck. I was thinking about taking some very nice profits after all the buyout talk. Then when I heard Chris Sacca (he was a big TWTR investor) on Bloomberg Tuesday night saying he had sold a big chunk of his stock and that it was currently overvalued, I decided it was time. Hopefully, it heads back down to the low teens.

Blog post with details from Marc Seidner's fixed income talk at a recent conference.

I added CLF to my rapidly growing pullback shopping list. Also eyeing PML, VKQ, and VMO since net yields are close to 5%. (I was in them but bailed on everything a while back.)

I like his tips. The patience tip is good. When I started investing last year I would invest my money as soon as it was transferred, since I had a few things picked out each time. Since it's been months and months since I've done anything, my patience has grown a bit and I'm going to keep training it.

I've been following some of the municipal funds, as well. Nearing 52 week lows.

Hooray for old I-Bonds! Yippee!

Rates on my aging portfolio are now 4.x% to 6.x%. These were purchased back in 2000-2002.

George the original one wrote:Hooray for old I-Bonds! Yippee!

I know! This term's rate is pretty close to most ERE's SWR. I wish they'd lift the cap -- I'd gladly move some money into them.

Are the main drawbacks with the muni CEFs (vs a Vanguard ETF) just the leverage and higher fees?

Sold GRVY today at 11.5 USD. I had bought it in July at 4.32 USD which makes a surrealist gain of +166%. Too bad the stock was representing only ~4% of my portfolio... It had been quoting for quite a long time under its net current asset value (my target was to sell it at 6.90, but reality exceeded my expectations )
So this good ol' Ben Graham was right!

No hike today. December is still on the table.

http://monevator.com/the-problem-with-l ... est-rates/

Relevant albeit from the other side of the Atlantic; seems to think that the pension deficits will be the primary motivator to raise rates here. It'll be interesting to see how things unfold as with the exception of Brexit Carney is being very quiet...