Treasury Bills, Notes, and Bonds Discussion

[MarieIG]

I tried to order a one year from TD Ameritrade on Friday, but my web page wanted me to revamp my security settings - which I did not. I intended on calling before the end of business, and then got sidetracked. TD did not have the option to order on Monday morning (although the bond order page was no longer asking me to change my security settings), so I missed that opportunity. (I ended up ordering a lesser amount around 9:15 Monday morning over at Vanguard.)

[JoeWras]

I stopped myself from putting some babble in there about the 52 week and was hoping that Audrey's summary would be back to back. And it was! Nice to be able to see the changes in back to back posts. Essentially, it was flat week over week.

Context on the 52 week is the previous was 5.351%. A bit of a month to month move, but not a whole lot either.

[MarieIG]

Quote:

Originally Posted by JoeWras I stopped myself from putting some babble in there about the 52 week and was hoping that Audrey's summary would be back to back. And it was! Nice to be able to see the changes in back to back posts. Essentially, it was flat week over week. Context on the 52 week is the previous was 5.351%. A bit of a month to month move, but not a whole lot either.

One of the questions is how long before declining rates? I simply don't know, i.e. whether it would have been better to buy a six month followed by another six month. (I have some six month T-bills maturing early next year.)

[JoeWras]

Quote:

Originally Posted by MarieIG One of the questions is how long before declining rates? I simply don't know, i.e. whether it would have been better to buy a six month followed by another six month. (I have some six month T-bills maturing early next year.)

We just don't know.

Pundits are split on whether there will even be another rate hike. The latest polls have the next meeting being flat, with a possible rate hike the following.

This is based on the idea that although the economic numbers show a cooling, employment in service is still really strong.

It does seem to me that we are near a top, if not the top.

I personally am mostly going to the 52 week or 2 year notes now. I've left a bit on the table by not going 26 week the last few months. Oh well.

[MarieIG]

Quote:

Originally Posted by JoeWras We just don't know. Pundits are split on whether there will even be another rate hike. The latest polls have the next meeting being flat, with a possible rate hike the following. This is based on the idea that although the economic numbers show a cooling, employment in service is still really strong. It does seem to me that we are near a top, if not the top. I personally am mostly going to the 52 week or 2 year notes now. I've left a bit on the table by not going 26 week the last few months. Oh well.

If the worst I could say about my investments is that I left a little bit on the table =

[Chuckanut]

One can always split the difference, buy a few 5 year CDs or notes in the area of 4.5% yield today, but keep and equal amount of powder dry in the event a 5+% yield opportunity pops up. For me trick is to maximize my chances that the investments will provide the needed income over a rolling 5 year period, not squeeze the last possible penny out of any particular rung on the ladder.

Accurate predictions are hard. Just getting accurate data is hard.

https://www.wsj.com/finance/investin...stray-abd79102

As the above article mentions, the UK has gone from being Europe’s basket case economy to being one of the strongest economies. What changed? New data that is far more realistic. The economy did not change, just the data that was reported.

Quote:

The latest example comes from the U.K., where it turns out the economy grew much more than previously estimated. Rather than being the sick man of Europe with GDP still smaller than before the pandemic, and the weakest recovery in the Group of Seven industrialized nations, it has beaten Germany and grown in line with France (at least until their figures are revised).

Quote:

Investors in the U.S. have been wrong-footed by the jobs market this year, which turned out much cooler than expected. Some of the surprise was simply that economists predicted more jobs would be created than in fact were, which is the normal uncertainty about the future that investing is all about. But revisions contributed, as initially strong jobs figures were later revised down sharply, with a quarter of a million fewer jobs created over the past six months than first thought. That turned out to be good for stocks, reducing the pressure for profit-sapping wage rises and easing the need for higher rates.

[Midpack]

You can’t really go wrong with Bills at present. Even 2 year is tempting to me now. But I’m sticking with 26 week for now in IRAs, 52 week in taxable for tax planning. While we’re probably at or near the top, I don’t see a substantial downside for a while, not until the Fed actually cuts rates and that won’t be anytime soon IMO. All my IRA bills mature 9/28 & 10/5. I may go longer duration when my 26 week bills mature in April, but not this October. YMMV

[Rianne]

We're looking for long-term high coupon (4%+) treasuries and CDs for cash flow and to preserve capital. Hopefully, our tIRA, all laddered treasuries, and CDs will provide that cash flow for income or reinvestment. Hope the rates remain high until mid-2024.

[Healthy Lifestyle]

Quote:

Originally Posted by Rianne We're looking for long-term high coupon (4%+) treasuries and CDs for cash flow and to preserve capital. Hopefully, our tIRA, all laddered treasuries, and CDs will provide that cash flow for income or reinvestment. Hope the rates remain high until mid-2024.

What will you do if rates remain high (or are lower) until mid-2024?

[Chuckanut]

It looks like the new offer of 10 year TIPS later this month will have a rate of about 1.9% + inflation at today's price.

I'm not an expert on TIPS but that seems to be a good return for a safe 10 year investment.

[audreyh1]

The week’s T-bill auction results:

Bills	CMB	CUSIP	Issue Date	High Rate	Investment Rate	Price per $100
4-Week	No	912797HB6	09/19/2023	5.285%	5.395%	$99.588944
8-Week	No	912797HK6	09/19/2023	5.295%	5.428%	$99.176333
13-Week	No	912797FU6	09/14/2023	5.315%	5.477%	$98.656486
17-Week	No	912797HZ3	09/19/2023	5.330%	5.516%	$98.238139
26-Week	No	912797GX9	09/14/2023	5.300%	5.537%	$97.320556

Pretty flat these days!

[MarieIG]

I had DS order a 26 week with his house downpayment account.

[audreyh1]

Rates going nowhere fast…

We have another 26 wk rollover end of this month.

[Marc]

Fed saying rates staying above 5% through all of 2024 and no recession; ergo, the yield curve needs to uninvert with 10yr going above 5%. This will be interesting to watch.

Marc

[Montecfo]

Quote:

Originally Posted by Marc Fed saying rates staying above 5% through all of 2024 and no recession; ergo, the yield curve needs to uninvert with 10yr going above 5%. This will be interesting to watch. Marc

Don't count on it. The Fed has no idea when it will cut. It will depend on jobs which have been weakening this year.

But I agree, always interesting.

[11522914]

Looks like the 10 year treasury finally broke out of it's upper resistance level. Up 13 basis points to 4.48% right now.

[audreyh1]

This week’s T-bill auction results:

Bills	CMB	CUSIP	Issue Date	High Rate	Investment Rate	Price per $100
4-Week	No	912797HC4	09/26/2023	5.280%	5.390%	$99.589333
8-Week	No	912797HL4	09/26/2023	5.300%	5.433%	$99.175556
13-Week	No	912797FV4	09/21/2023	5.315%	5.477%	$98.656486
17-Week	No	912797JA6	09/26/2023	5.340%	5.527%	$98.234833
26-Week	No	912797LL9	09/21/2023	5.300%	5.537%	$97.320556

[tulak]

I bought another step in my TIPS ladder today: ytm 2.149, matures 7/15/33.

Yields are up.