Investment Thread

[Bluedog]

Regulators are definitely that unimaginative! Regulators are completely reactive and constantly scream “Fire” after the building has burned to the ground.

You'll like this one then:
"Fed Slams Its Own Oversight of Silicon Valley Bank in Post-Mortem: The Federal Reserve released hundreds of pages documenting how bank supervision and regulation failed to prevent the lender’s painful collapse."
https://www.nytimes.com/2023/04/28/b...re-review.html

A sweeping — and highly critical — review conducted by Michael S. Barr, the Fed’s vice chair for supervision, identified lax oversight of the bank and said its collapse demonstrated “weaknesses in regulation and supervision that must be addressed.”

“Regulatory standards for SVB were too low, the supervision of SVB did not work with sufficient force and urgency, and contagion from the firm’s failure posed systemic consequences not contemplated by the Federal Reserve’s tailoring framework,” Mr. Barr wrote in a letter accompanying the report.

[bundabergdevil]

You'll like this one then:
"Fed Slams Its Own Oversight of Silicon Valley Bank in Post-Mortem: The Federal Reserve released hundreds of pages documenting how bank supervision and regulation failed to prevent the lender’s painful collapse."
https://www.nytimes.com/2023/04/28/b...re-review.html

Will they need a second piece onFirst Republic?

[Jeffrey]

You'll like this one then:
"Fed Slams Its Own Oversight of Silicon Valley Bank in Post-Mortem: The Federal Reserve released hundreds of pages documenting how bank supervision and regulation failed to prevent the lender’s painful collapse."
https://www.nytimes.com/2023/04/28/b...re-review.html

That’s truly just the tip of the iceberg. The 95% below the waterline is much more pathetic, disgusting, and corrupt! And, the very few who get caught are never prosecuted.

[YmoBeThere]

They may be that risk adverse given the highly abnormal source of massive deposit inflows. It’s definitely hot money and they have just been shown how quickly it can come and go.

It has created a problem for me, one that I recall being mentioned years ago in b-school but one I've not run into until now. Well, noticed until now. Reinvestment risk. I have moved a bunch of money into short term Treasuries, particularly of the 4 week variety. Got in there at a 5.12% annualized rate. But rolling over into a 4.23% rate when the Fed is going to raise again next week (not making a judgement on that) versus 4.21% at my online bank.

The new rate on I bonds will be 4.30% as the Treasury has announced a fixed rate of 0.90%.

[Jeffrey]

It has created a problem for me, one that I recall being mentioned years ago in b-school but one I've not run into until now. Well, noticed until now. Reinvestment risk. I have moved a bunch of money into short term Treasuries, particularly of the 4 week variety. Got in there at a 5.12% annualized rate. But rolling over into a 4.23% rate when the Fed is going to raise again next week (not making a judgement on that) versus 4.21% at my online bank.

The new rate on I bonds will be 4.30% as the Treasury has announced a fixed rate of 0.90%.

Did you solve your own problem when you wrote….

“…. but there was no move in the 8 or 13 week T bills. Are they that unimaginative?”

https://forums.dukebasketballreport...53#post1595453

[YmoBeThere]

Did you solve your own problem when you wrote….

“…. but there was no move in the 8 or 13 week T bills. Are they that unimaginative?”

https://forums.dukebasketballreport...53#post1595453

Yeah, but not sure I like the feeling of unavailability of the funds, that is why I was going with the 4 week bills. The "fear", even for such a short period, is irrational but existent.

[YmoBeThere]

And the FRC situation has been resolved. I never got back into after flipping what I had for a profit.

[Jeffrey]

And the FRC situation has been resolved. I never got back into after flipping what I had for a profit.

Definitely a big swing and miss for me! Another large tuition payment… expensive lesson learned.

Next play!

[Jeffrey]

And the FRC situation has been resolved. I never got back into after flipping what I had for a profit.

As a JPM shareholder, I really like this deal!

As a US citizen, I really dislike regulators!

[YmoBeThere]

Discusses what I've observed via TreasuryDirect.

Utter Chaos at the Short End of the Treasury Market and at the 28-Day Treasury Bill Auction: A Deep Dive

by Wolf Richter • May 6, 2023

https://wolfstreet.com/2023/05/06/ut...n-a-deep-dive/

[YmoBeThere]

Hope many of you owned a small slice of NVDA.

[nmduke2001]

Proof that a time machine does not exist:

In May of 2013, you could have purchased NVDA for $3.40. A $10,000 investment would have bought you 2,941 shares. In November of 2021 NVDA was selling for $345 which would have netted $862,500 (after 15% long term capital gains tax). If you were patient for one year, NVDA went back down to $110/share in October of 2022. Reinvesting in NVDA you would have purchased 7,841 shares, which is worth just over $3 million today.

[howardlander]

Hope many of you owned a small slice of NVDA.

I have some, but more would be better for sure!

[budwom]

Hope many of you owned a small slice of NVDA.

High times for them, but as a veteran of the chip industry, I can tell you that they have a huge exposure (along with a lot of other companies) should China decide to eat Taiwan...

[DukeDude]

MRVL is up 26% today mainly because they see AI as a growth driver going forward. I'd say the AI bubble has just started inflating.

[duke79]

MRVL is up 26% today mainly because they see AI as a growth driver going forward. I'd say the AI bubble has just started inflating.

Yep, MRVL has gone from 36 to 65 in the last month. Nice move!

[budwom]

looks like that much much anticipated recession still hasn't arrived...employment figures today well above expectations (though unemployment rate ticket up a bit), Dow up 400, summer travel expected to boom (somewhat at the expense of other spending, perhaps).

[Bluedog]

looks like that much much anticipated recession still hasn't arrived...employment figures today well above expectations (though unemployment rate ticket up a bit), Dow up 400, summer travel expected to boom (somewhat at the expense of other spending, perhaps).

Yes, everyone has been anticipating a recession for quite some time and it just...won't...come. Maybe it never will. Shows how hard it is to predict these things.

On the downside, sounds like the Fed may not be done with interest rate hikes as previously expected and inflation is still rearing its ugly head (although is tamed a bit). Stock market up ~10% YTD (although still at ~April 2021 levels, which shows you how long it takes to recover when it goes down 20% in a year...needs to go up 25% to make up for a 20% fall. I'm using VTSAX as a proxy.) I continue to buy though, as I always do. We may be reaching peak CD/MM levels soon at north of 5% (and at the lower durations - 1 year paying more than 5 year, which is historically unusual). Wonder if many will want to lock in those rates for basically guaranteed returns. It's like the I Bond play from last year. I'm putting my cash in MM funds for now and keeping that portion of the portfolio relatively liquid (I use VUSXX -- generally free from state tax), but will monitor things.

[budwom]

Yes, everyone has been anticipating a recession for quite some time and it just...won't...come. Maybe it never will. Shows how hard it is to predict these things.

On the downside, sounds like the Fed may not be done with interest rate hikes as previously expected and inflation is still rearing its ugly head (although is tamed a bit). Stock market up ~10% YTD (although still at ~April 2021 levels, which shows you how long it takes to recover when it goes down 20% in a year...needs to go up 25% to make up for a 20% fall. I'm using VTSAX as a proxy.) I continue to buy though, as I always do. We may be reaching peak CD/MM levels soon at north of 5% (and at the lower durations - 1 year paying more than 5 year, which is historically unusual). Wonder if many will want to lock in those rates for basically guaranteed returns. It's like the I Bond play from last year. I'm putting my cash in MM funds for now and keeping that portion of the portfolio relatively liquid (I use VUSXX -- generally free from state tax), but will monitor things.

I, too, am a fluid man...helps me sleep at night since I'm a geezer and have no intention of going back to work...

At least the nightly newscasters have stopped referring to "the recession" as they had been doing for months and months. Yes, there may well be one, but right now people are still employed, still spending (with pattern changes) and the world ain't half bad...

[budwom]

bumping this thread to put in a piece from Mark Zandi, one of my favorite analysts, on why he doesn't see a recession coming:https://www.cnn.com/2023/06/20/opini...ndi/index.html