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Do you think we will see 4% 5 year CDs before Year End?
06-09-2018, 04:09 PM
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#1
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2003
Location: Florida's First Coast
Posts: 7,723
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Do you think we will see 4% 5 year CDs before Year End?
As the title says, what do you all think the chances of a 4% 5 Year CD in 2018?
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06-09-2018, 04:14 PM
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#2
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Thinks s/he gets paid by the post
Join Date: Nov 2011
Posts: 3,902
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Less than 4%, pun intended.
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06-09-2018, 04:25 PM
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#3
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2016
Location: Colorado
Posts: 8,971
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There already are 4%CDs if you are willing to have extended duration. What duration are you talking about?
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06-09-2018, 04:32 PM
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#4
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Thinks s/he gets paid by the post
Join Date: Nov 2015
Posts: 2,692
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Yes, no, maybe.... Guaranteed to be right
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06-09-2018, 04:49 PM
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#5
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Full time employment: Posting here.
Join Date: Jan 2010
Posts: 540
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Quote:
Originally Posted by COcheesehead
There already are 4%CDs if you are willing to have extended duration. What duration are you talking about?
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The OP says 5 year CDs.
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06-09-2018, 04:51 PM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2016
Location: Colorado
Posts: 8,971
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Quote:
Originally Posted by Earl E Retyre
The OP says 5 year CDs.
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Well now with the OP’s edit to the title and the text, I say not a chance.
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06-09-2018, 05:18 PM
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#7
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Thinks s/he gets paid by the post
Join Date: Mar 2009
Posts: 2,985
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This week the best 5 year with call protection is 3.3%. With the yield curve so flat it would hard to imagine anything over 3.5%, even with a couple of Fed increases. But who knows? It doesn't matter to me since I don't market time fixed income or equities.
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Took SS at 62 and hope I live long enough to regret the decision.
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06-09-2018, 06:39 PM
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#8
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Thinks s/he gets paid by the post
Join Date: Mar 2012
Posts: 3,931
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Quote:
Originally Posted by foxfirev5
This week the best 5 year with call protection is 3.3%. With the yield curve so flat it would hard to imagine anything over 3.5%, even with a couple of Fed increases. But who knows? It doesn't matter to me since I don't market time fixed income or equities.
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This past week I've been able to buy CDs in the secondary market at 3.57% for 5 years + 9 months, call protected.
We may not see 4% for 5 years, but I'm fairly confident that you will be able to get 4% for 10-year in the secondary market by year end.
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06-09-2018, 07:12 PM
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#9
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2008
Posts: 35,712
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I remember that the credit union at work paid something like 12%, or perhaps even higher, in 1980 for some short-term CD.
Now, that was an exciting time as inflation was running even higher. My 30-year mortgage rate was 14%. Will we see that again?
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"Old age is the most unexpected of all things that happen to a man" -- Leon Trotsky (1879-1940)
"Those Who Can Make You Believe Absurdities Can Make You Commit Atrocities" - Voltaire (1694-1778)
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06-09-2018, 07:21 PM
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#10
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Thinks s/he gets paid by the post
Join Date: Nov 2015
Posts: 2,692
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Quote:
Originally Posted by NW-Bound
I remember that the credit union at work paid something like 12%, or perhaps even higher, in 1980 for some short-term CD.
Now, that was an exciting time as inflation was running even higher. My 30-year mortgage rate was 14%. Will we see that again?
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I was just getting started in my career then. Bank I worked at had 14% repo's. I remember a dentist had mortgage at 18%, all tied to getting his business started. Mortgage rates were indeed 12%, but i managed to get my first place at under 7% with an assumable mortgage. How many recall repo's and assumable mortgages? Lol
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06-09-2018, 09:38 PM
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#11
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2004
Location: Laurel, MD
Posts: 8,327
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I expect 5 yr CDs will be ~3.75 by yr end.
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...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
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06-10-2018, 04:37 AM
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#12
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Thinks s/he gets paid by the post
Join Date: Jun 2017
Location: Western NC
Posts: 4,633
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Quote:
Originally Posted by NW-Bound
I remember that the credit union at work paid something like 12%, or perhaps even higher, in 1980 for some short-term CD.
Now, that was an exciting time as inflation was running even higher. My 30-year mortgage rate was 14%. Will we see that again?
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My credit union's money market paid 9% when I was a kid.
I remember thinking if only I had a million or so I could live large...
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06-10-2018, 05:16 AM
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#13
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Thinks s/he gets paid by the post
Join Date: Feb 2004
Location: Switzerland
Posts: 1,047
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Quote:
Originally Posted by bobandsherry
I was just getting started in my career then. Bank I worked at had 14% repo's. I remember a dentist had mortgage at 18%, all tied to getting his business started. Mortgage rates were indeed 12%, but i managed to get my first place at under 7% with an assumable mortgage. How many recall repo's and assumable mortgages? Lol
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Ah yes, I remember those days. 14%, 16%, 18% and higher annual raises too! Damn, I must have been an amazing performer back then. :-)
-BB
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FIREd, April 1, 2015. My Retirement Benefits Package includes: 6 months vacation, twice a year.
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06-10-2018, 06:33 AM
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#14
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2008
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My megacorp had to give everybody "emergency" 6-month raises so their salaries could keep up. Else, new hires could make a lot more than existing engineers.
__________________
"Old age is the most unexpected of all things that happen to a man" -- Leon Trotsky (1879-1940)
"Those Who Can Make You Believe Absurdities Can Make You Commit Atrocities" - Voltaire (1694-1778)
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06-10-2018, 06:33 AM
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#15
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Thinks s/he gets paid by the post
Join Date: Dec 2014
Location: St. Charles
Posts: 3,919
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Quote:
Originally Posted by NW-Bound
I remember that the credit union at work paid something like 12%, or perhaps even higher, in 1980 for some short-term CD.
Now, that was an exciting time as inflation was running even higher. My 30-year mortgage rate was 14%. Will we see that again?
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And the "conventional wisdom" at the time was we would never again see mortgage interest rates below 10% .
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06-10-2018, 06:36 AM
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#16
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Yes. I was worrying about my younger brothers, saying they would not be able to buy homes as I saw that the mortgage rate climbed up to 16% from the 30-year 14% that I paid.
__________________
"Old age is the most unexpected of all things that happen to a man" -- Leon Trotsky (1879-1940)
"Those Who Can Make You Believe Absurdities Can Make You Commit Atrocities" - Voltaire (1694-1778)
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06-10-2018, 08:43 AM
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#17
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Location: West of the Mississippi
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My first mortgage was 8 1/2%, second - 12 3/4% which I refinanced later with a variable rate mortgage which was 1.6% over the current one year t-bill rate (Best darn mortgage I ever had!!!) After that it was a 6.6% mortgage which I paid off early when my standard deduction was larger than my interest+taxes deduction (yes, it was a very small mortgage by then).
I would like to see 4%, but not at the cost of an inflationary hike.
Mostly, I would like to see my savings, after taxes and inflation yield at least 2%. The current inflation rate is about 2.5%, so we are long way from that.
IMHO, the war on savers still continues, it's just not as brutal as it has been previously.
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Comparison is the thief of joy
The worst decisions are usually made in times of anger and impatience.
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06-10-2018, 08:47 AM
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#18
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2003
Location: Florida's First Coast
Posts: 7,723
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What rate would convince you (Anyone here) to take a substantial chunk out of the stock market and lock it up for 5 years? Enough that you could live off the interest, or in addition to a modest withdrawal from capital.
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06-10-2018, 09:08 AM
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#19
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Thinks s/he gets paid by the post
Join Date: Aug 2006
Posts: 2,433
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Quote:
Originally Posted by ShokWaveRider
As the title says, what do you all think the chances of a 4% 5 Year CD in 2018?
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Unlikely, based on the current Treasury yield curve. The forward 5-year rate one year from today based on current Treasury yields is only about 17 basis points higher than the current 5-year rate.
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I'd rather be governed by the first one hundred names in the telephone book than the Harvard faculty - William F. Buckley
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06-10-2018, 09:18 AM
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#20
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2018
Location: Tampa
Posts: 11,298
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Quote:
Originally Posted by Chuckanut
My first mortgage was 8 1/2%, second - 12 3/4% which I refinanced later with a variable rate mortgage which was 1.6% over the current one year t-bill rate (Best darn mortgage I ever had!!!) After that it was a 6.6% mortgage which I paid off early when my standard deduction was larger than my interest+taxes deduction (yes, it was a very small mortgage by then).
I would like to see 4%, but not at the cost of an inflationary hike.
Mostly, I would like to see my savings, after taxes and inflation yield at least 2%. The current inflation rate is about 2.5%, so we are long way from that.
IMHO, the war on savers still continues, it's just not as brutal as it has been previously.
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Real returns averaging at least 2% would likely ensure portfolio survival for most posters.
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TGIM
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