We are entering a "Golden Period" for fixed income investing

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mikes425 said:
Staying put in a 50/50 AA balanced PF hasn't been exactly comforting. I can't be the only one with that feeling but I do appreciate that it still could be a lot worse

I have the same thoughts, but feel I have to stay the course, and wait for better returns.

Dividends are still pretty good but, there's alot of confounding behavior on the equity side. Hard to fathom a Fed choice to raise interest rates further when big Oil and other industry titans are making mad money, and the US economy grew at a 1.1% annual rate in the first quarter; a third straight quarter of growth after output contracted in the first half of last year.
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I believe these are the reasons why the Fed will continue with May 1/4% interest rate increase. Powell would prefer a recession to help get us back to eventual lower Fed rates.
 
The millennial generation is doing very well economically from what I see. Job security is better than my generation. They have bigger nicer houses than I did when I was their age.
 
Hard to draw conclusions from a single metric. And META earnings are not exactly a bellwether for interest rates as far as I can tell.

I tend to think the yield curve will normalize with the short end dropping. That is how it happens just about every time.

If by "higher for longer" you mean short-term rates, that will drive other rates lower. So not sure that is something to hope for.

If by "higher for longer" you mean long rates will rise sharply, that seems dubious to me. The economy is barely growing as it is. Why would long rates rise?

In any event, laddering is wiser in my view than speculating on rate direction.
 
Another 1/4 point increase is coming next week then a pause for the next few meetings "to see what happens". So says my crystal ball.
 
The mortgage rate I paid for my houses was more like seven or eight percent not three or four percent. Anyone that took on a mortgage in the last ten years got a deal. The unemployment rate during my generation was not sub 4%. There was no quick painless fix to the 80/81 recession. The so called Great Recession wasn’t anywhere near as painful as 80/81. Will 14% unemployment make a comeback? We’re gonna find out. Doesn’t look like it though. Unless the fed thinks inflation is hanging around too long. This current generation has so much technological luxury it’s crazy
 
Lease your EV?

Fewer than a dozen EVs qualify for the full $7,500 tax credit if purchased by a consumer. But all battery-powered models benefit from it if they’re leased, because in that case the IRA categorizes them as commercial vehicles. The lease option is an IRA loophole you could drive millions of electric vehicles through. International automakers lobbied for and secured it after fearing they’d be shut out of the IRA tax credits aimed at stimulating the nascent EV market in the US.
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Saw this on Apple News so I can’t like it properly. It was a Bloomberg article. Looks like anyone can get the tax break on any EV just by leasing it. Do you think this will be the new way to go? Downside is that dealers can really shaft you with leases if you don’t know what you’re doing.



Ooops! Wrong thread!
 
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EV battery mining is environmentally destructive. How long will the hype last?
 
Born2Fish said:
Thanks a lot for the recent buy examples.

I spent some time sorting the data and I can see the attraction of buying these issues below par.

Best rates I am seeing this afternoon is around 4.3% YTM.

Do you have a YTM range in mind to purchase?
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Not really, it's like pornography, I know it when I see
 
Popeye said:
Looks like anyone can get the tax break on any EV just by leasing it. Do you think this will be the new way to go?
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I believe the credit only goes to the buyer, which would be the dealer for a leased vehicle. So they may or may not pass that on to the customer. I've heard of both ways from various dealers.
 
Hydrogen & natural gas are clearly superior. Batteries are for toys & my TV remote.
 
Anyone have thoughts on reverse globalization & it’s inflationary effect? Resulting in higher interest rates? Trading supply stability for higher costs would be one of the trade offs I guess. Rate hike in a few days will translate into my government VG money market yielding over 5%. That’s kinda sweet isn’t it?
 
Free bird said:
Anyone have thoughts on reverse globalization & it’s inflationary effect? Resulting in higher interest rates? Trading supply stability for higher costs would be one of the trade offs I guess. Rate hike in a few days will translate into my government VG money market yielding over 5%. That’s kinda sweet isn’t it?
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I think its obvious that reverse globalization will cause inflation, as workers making stuff here earn ~15x what workers in other countries earn. If it's automated manufacturing, then not much difference except to build the factory.
I don't think it will affect interest rates due to the many years any reverse globalization will take so the effect will be spread out.

It will take decades to happen but would be better for this country if we actually made things here, because the process of making stuff encourages people to develop better ways to make stuff and the quality goes up.
 
How about we stay on topic. Bond investing. Please start your own threads re: electric cars, reverse globalization, etc. Thank you.
 
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Freedom56 said:
Banks of America is safe. RBC is safer. I own a lot of Bank of America notes but at higher yields. In general , the major Canadian banks are much safer than US banks. TD Bank is on track to becoming the largest bank in Canada and one of the largest in the U.S.
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I've been living under a rock for the past month while moving 1500 miles across the country. Today I peaked out and saw a bond had dropped 4.34% in value today... seems like a big move for 1 day.
What little "latest" news I can find on the bond page was a report from December 2022 saying it was stable.
CUSIP: 78014RKL3
Issuer: ROYAL BANK OF CANADA
Where is a good source of latest news/events/disclosures that might explain the big move?
 
Spock said:
I've been living under a rock for the past month while moving 1500 miles across the country. Today I peaked out and saw a bond had dropped 4.34% in value today... seems like a big move for 1 day.
What little "latest" news I can find on the bond page was a report from December 2022 saying it was stable.
CUSIP: 78014RKL3
Issuer: ROYAL BANK OF CANADA
Where is a good source of latest news/events/disclosures that might explain the big move?
Click to expand...

It’s mark to market pricing reflecting larger spreads for thinly traded bonds. If you bought to hold, you have nothing to worry about.
 
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