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Old 09-08-2023, 11:55 PM   #1721
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Yes, I'm thinking no changes after a couple increases... who knows but I'm thinking no decreases unless we end up having a recession.
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Old 09-11-2023, 08:18 PM   #1722
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One CD showed up at Fidelity today with 3 yr / 5.0% / non-callable terms. There were about 2000 available. I don't remember the bank name but when I went back just now they were gone.

Might be more to come?

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Old 09-11-2023, 08:23 PM   #1723
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Originally Posted by jazz4cash View Post
Itís attractive to me! My maturing CDs are 3% but the term was 7 yrs! It was a very good rate at the time. As far as current rates, I just donít like the inversion
Well it is all a matter of perspective jazz4cash!

I do not have any maturing cash now. Just looking for 5+ yr 6% high investment grade in order to move some of my equity allocation to binds. We will see if that happens.
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Old 09-11-2023, 08:25 PM   #1724
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Originally Posted by pb4uski View Post
Yes, I'm thinking no changes after a couple increases... who knows but I'm thinking no decreases unless we end up having a recession.
Just for perepctive: Average time between last Fed hike and 1st Fed cut is 5.5 months. I believe that goes back to 1970.
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Old 09-11-2023, 08:29 PM   #1725
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Monte, I know nobody can predict interest rates, but in your opinion do we still have some upside ahead for the longer terms? I have a some CD's maturing in in the next two months and am hoping to pick up 3 yr, 4 yr, and 5 yr term closer to 5% average rate with that money.



I'm only looking at call protected offerings and right now I could get a 4.77% blended rate. I could use other funds to buy now, but would prefer to wait until the current holdings mature.



BrianB
I think we may have a bit in treasuries essentially because there is a lot of new supply to be auctioned. This could push up CD and corporate yields.

But the pattern has been better deals are available briefly, so you have to be ready to strike.

We are close to the end on any Fed actions based on how things look now.
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Old 09-11-2023, 08:31 PM   #1726
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^^^^^
Depends on what Powell says/does later this month.
Powell will hold steady this month. More important will be his rhetoric.

I expect him to play it straight down the middle and leave all options on the table for November.
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Old 09-12-2023, 10:23 AM   #1727
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Again today there is one offering at Fidelity for a 3 yr / 5.0% / non-callable CD. It's from Discover Bank (same as the one yesterday - I just couldn't remember the bank name). Quantity 3105 available as of now. We'll see how long they last.

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Old 09-12-2023, 10:24 AM   #1728
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Current best non-callable CD rates at Schwab:

12 mo - 5.45%
18 mo - 5.40%
24 mo - 5.25%
36 mo - 5.00%
48 mo - 4.80%
60 mo - 4.65%


First time I've seen a 3-year non-callable at 5% in this cycle. I did buy one at 5.10% back in March when the liquidity panic hit. The rise in CD rates seems orderly and systematic this time.
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Old 09-12-2023, 10:34 AM   #1729
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^^^^^
These slowly rising rates on the longer term CDs are telling me that the big banks must be thinking that the FED has more rate increases coming and/or they will be slow at reducing rates in the future.
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Frontwave Credit Union 18-Month CD Special Has Near Rate-Leading APY
Old 09-12-2023, 10:36 AM   #1730
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Frontwave Credit Union 18-Month CD Special Has Near Rate-Leading APY

Deal Summary: 18-month Certificate Special, 5.50% APY, $1k minimum deposit, new money.
Availability: Riverside, San Bernardino, and San Diego Counties, California.

https://www.depositaccounts.com/bank...-union/offers/

Looks like they are also offering it in an IRA according to their website but I already pulled all my IRA money out when their IRA CD rates dropped to less than 1%.
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Old 09-12-2023, 10:51 AM   #1731
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Probably a dumb question, but when a 3 mos CD is marketed at 5% is that 5% annualized or is it 5% of the purchase at time of payout. So would a 5% CD be .42% / month or 5% of cost of CD added to purchase price of CD?
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Old 09-12-2023, 10:54 AM   #1732
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Probably a dumb question, but when a 3 mos CD is marketed at 5% is that 5% annualized or is it 5% of the purchase at time of payout. So would a 5% CD be .42% / month or 5% of cost of CD added to purchase price of CD?
It's on an annualized rate. Not sure I understand the rest of your post.
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Old 09-12-2023, 11:06 AM   #1733
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Originally Posted by Car-Guy View Post
^^^^^
These slowly rising rates on the longer term CDs are telling me that the big banks must be thinking that the FED has more rate increases coming and/or they will be slow at reducing rates in the future.
WSJ has an article on brokered CDs today. I underlined one section below that is part of the mix and is not meant to discount your point, which I think is also part of it.

Free link: https://www.wsj.com/finance/banking/...hare_permalink

Quote:
Banks Load Up on $1.2 Trillion in Risky ‘Hot’ Deposits
Brokered deposits rose 86% from a year earlier, and regulators are growing concerned


Many industry players view brokered deposits as a double-edged sword. They can be a quick and easy way for a bank to shore up its balance sheet. The deposits are typically much more expensive because banks have to pay higher interest rates to lure in those customers, along with other fees. Regulators and bankers say they are also a type of “hot” money that is prone to disappear when a bank hits a rough patch, since these yield-seeking customers don’t tend to be loyal.

...

Brokered deposits are what they sound like: A bank can go to a third-party broker such as Morgan Stanley or Fidelity to find customers to invest in the bank’s high-yielding certificates of deposit. That allows the bank to get big influxes of money at once, rather than customer by customer.
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Old 09-12-2023, 12:09 PM   #1734
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^^^^^
Interesting article... It sort of filled in "or" confirmed a few things for me away. Thanks
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Old 09-12-2023, 02:34 PM   #1735
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Quote:
Originally Posted by jldavid47 View Post
Current best non-callable CD rates at Schwab:

12 mo - 5.45%
18 mo - 5.40%
24 mo - 5.25%
36 mo - 5.00%
48 mo - 4.80%
60 mo - 4.65%


First time I've seen a 3-year non-callable at 5% in this cycle. I did buy one at 5.10% back in March when the liquidity panic hit. The rise in CD rates seems orderly and systematic this time.
So a 5 year ladder would be a hair over 5%... pretty good methinks!
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Old 09-13-2023, 09:08 AM   #1736
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So a 5 year ladder would be a hair over 5%... pretty good methinks!
I am seeing similar 5 year cd rates on Merrill Edge this morning. I am retired age 66+ with rollover IRA in all fixed income investments.
Thought I would be happy seeing an opportunity to build a 5 year ladder at 5%, Do you think I am hesitating and overthinking the FOMO on higher for longer rates?
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Old 09-13-2023, 09:28 AM   #1737
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I am seeing similar 5 year cd rates on Merrill Edge this morning. I am retired age 66+ with rollover IRA in all fixed income investments.
Thought I would be happy seeing an opportunity to build a 5 year ladder at 5%, Do you think I am hesitating and overthinking the FOMO on higher for longer rates?
Is FOMO equivalent to Market Timing?
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Old 09-13-2023, 09:33 AM   #1738
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Is FOMO equivalent to Market Timing?
Fear Of Missing Out does often drive market timing.
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Old 09-13-2023, 06:25 PM   #1739
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Fear Of Missing Out does often drive market timing.
I'm not sure about that but it certainly drives people to buy assets that are greatly overvalued. FOMO simply one manifestation of greed (and the greater fool theory).
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Old 09-13-2023, 06:35 PM   #1740
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...Thought I would be happy seeing an opportunity to build a 5 year ladder at 5%, Do you think I am hesitating and overthinking the FOMO on higher for longer rates?
Perhaps. You could always skew the ladder to the first few years and then methodically extend it is early rungs mature.

That is what I ended up doing... not necessarily intentionally.. but my ladder is skewed to the early years and as maturities occur I am backfilling some rungs.
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