Boghies Account Talk

[Boghie]

Almost Time for a Change!!!

I'll never get to 25 posts:mad
I'll take some cheese with that whine!!!

But, soon it will be time to start moving back into the market. We saw a very quick 10% correction. Less than a day. Then, the Fed stepped in and did their job.

However, there seems to be lots of churning in the water. No smooth up. No smooth down. And, I really hate to invest in the summer. In the end, it always seems flat. Just waiting for an October correction!!! Or, a November boom!!!

This September I will move more of my G into C/S/I. I will wait for a dip which is certain to come. Maybe when the Fed tries to play it cheap this Thursday. I have to get as many months invested in the market as I can before Congress plays a negative role.

So, for right now this is a bit of a wasted post. No change. I like my 8.57% growth with a 50% holding in the G.

Just waiting.
Water is churning..
Yum, yum - chum in the water...

 

[EW_ret]

The requirements to join the new Automated Tracker are ten (10) posts. You have already met this. Do you want me to create a User Profile for you Boghie? I need your email address to enter into your User profile for the Automated Tracker. This email should be one you visit frequently, and normally use when accessing TSPTalk.com. Send me you email by Private Message (PM). Then starting this Friday (8-31-2007), and thereafter, you access the Online Tracker by this URL: Automated Tracker

The first time you access the login page you must request your temporary password by clicking Forgot Password. This is located below the Login window. You User ID is your normal TSPTalk member name (Boghie). Your temporary password will then be emailed to you using the address you provide. You can change your password once you have successfully logged in.

I'll never get to 25 posts:mad
I'll take some cheese with that whine!!!

But, soon it will be time to start moving back into the market. We saw a very quick 10% correction. Less than a day. Then, the Fed stepped in and did their job.

However, there seems to be lots of churning in the water. No smooth up. No smooth down. And, I really hate to invest in the summer. In the end, it always seems flat. Just waiting for an October correction!!! Or, a November boom!!!

This September I will move more of my G into C/S/I. I will wait for a dip which is certain to come. Maybe when the Fed tries to play it cheap this Thursday. I have to get as many months invested in the market as I can before Congress plays a negative role.

So, for right now this is a bit of a wasted post. No change. I like my 8.57% growth with a 50% holding in the G.

Just waiting.
Water is churning..
Yum, yum - chum in the water...

 

[Boghie]

Thoughts on a Question...

Hi, Boghie,

I joined recently after reading a lot on the message board. I am trying to find a thread written by someone responding to another's question or comment, who said that it was best to buy an IRA by borrowing out of the TSP. Was it you or do you remember reading about it? Thanks for your writings, I really enjoy them and learn a lot from them, please keep them coming!

It definitely wasn't me that recommended such a strategy. In my very humble opinion (not a professional advisor or investor, but love the radio talk shows on the topic) here are the positives of such a strategy:

1. You have a wider range of investments. You can invest in any stock, any mutual fund, any sector, or any investment model. It sure would have been nice to invest in REITS (Real Estate Investment Trusts) from 2001 till 2006. We cannot do that in TSP. Sure would have been nice to invest a little in individual stocks - that is, gamble a bit. Cannot do that in TSP.
2. You can invest in actual cash. Did you know that the Federal Government can 'borrow' from the 'G Fund' to cover expenses when they surpass their congressionally mandated total debt limit. Who cares? I do. Number 1: it is morally wrong for some lawyers in the Fed to nitpick the law to help with their credit crunch. They never solve the problem. What is a debt limit if you can borrow to pass right by it. Number 2: while I am confident the government will pay it back I am not certain. Number 3: I don't remember TSP telling me that in the prospectus.

Here are the negatives:

1. You have to pay back the money borrowed from TSP within 5 years or immediately upon leaving your job. Get RIFFD and get a huge and immediate balloon payment.
2. Who wants to pay 5% in an attempt to make 10%. What if you lose 5% in a lousy market - like the one we are in. Now you lose 10%. That hurts. Let's say you gain 15% - which would place you near the top of the TSP mavens here. Your true gain would be 10% which is just the average 'C Fund' growth. It's like betting on a 9/7 longshot with a gimpy horse.

Now, conversely, if you are retiring I like moving all, much, or some of the money to a self-directed IRA. Why annuitize it all and have no ability to beat the market. I much prefer the ‘Buckets of Money’ strategy promoted by Ray Lucia in his radio show. Basically, place 5 – 7 years of full draw downable expense money in money market and treasury accounts, the next bucket is for 5 – 7 year growth and will be used to replenish bucket one, the final is stocks and stock funds that should be held 10 years or longer that will be used to replenish all the buckets.

Sorry about the long and late reply

 

[Boghie]

Still Holding Strong...

Yuk, yuk...

Still have that super investor fund mix of:

50% in G
30% in C
10% in S
10% in I​

I am, however, allocating:

60% to C
20% to S
20% to I​

And guess what...

Even though I am not investing into the G Fund it is growing as a percentage of my holdings - that is, it is now about 52% of my holdings.

That tells you that sometimes it pays to be a bit safe

Me thinks, however, that I will readjust my holdings after the FedHead Yak to:

30% in G
40% in C
15% in S
15% in I
​

Why?
I still have a 30% holding in the closest thing to cash. That will allow me to invest if the market dumps. For example, right now if the worldwide stock market dumps another 10% I will lose only about 4.5% because of the holdings in the 'G Fund'. Even after rebalancing I will limit my risk to a 7% loss. And, that will be a total market correction of about 20% or so from the highs. That 30% will be my buy low sell high fund...

My current TSP has gained 8.94% YTD.

Another 10% in market losses will result in a very inexpensive stock market. The market gains will happen quickly and decisively. Where else is all that real estate money going to go?

 

[Boghie]

Yup, that's my 'glamour' photo...

Yup, that's my new 'glamour' photo being used as an avatar.

The picture didn't cost much at my local Sears. For some reason the staff and customers kept running off and laughing. I couldn’t figure out what was so funny. It took a loooonnnnnnnngggggggggg time to finally get the shot. Very poor customer service

But now I have a photo that I can send with my next ‘Soldiers Angels’ letter

That should liven up the troops.

Anyone have any ideas on touching up more of the rough edges?

 

[Boghie]

20070919: Allocation Change

Original:

• G: 50%
• C: 30%
• S: 10%
• I: 10%

New:

• G: 30%
• C: 40%
• S: 15%
• I: 15%

Not a big move, but one promised in an earlier post. Waited for FedHead to act, sat around for big run-up, and now moving a little more holdings to stock on what should be a little downturn...

Still wary about September...

Have no feeling one way or another about October...

And, obviously very concerned about the actions of Congress in January...

 

[Boghie]

You are in that Top 5% - you are rich!!!

So you have retired...

You have your;

• Pension,
• Your Social Security,
• And a rather large TSP bucket!!!

What a joy!

The Golden Years!

So, you want to take a chunk of your TSP and buy a condo in Aruba or somewhere. You want no payments.

You don't need no stinking payments!

So, you yank the $200,000 out of TSP and buy that condo in cold hard cash. Sipping Mai Tais on the beach from October through April...

Then, comes the ‘Day of Atonement’. April 15th. But, you are a good retiree and send all the tax stuff to H&R Block in Houston and let them deal with it - in March.

On April 13th H&R Block calls and leaves a message on your cell phone. Your taxes are done and you owe $30,000 in additional taxes. Oh my… You are rich. You are in that top 5% of Americans who must pay their fair share. And, this is with BusHitler’s evil tax cut. What about next year!!!

Just pay, baby – just pay…

That $200,000 put you in the top tax bracket – and, likely in the Alternative Minimum Tax. You are now paying a flat tax. All your deductions simply went away. You don’t even get your new mortgage deduction. And - yuk, yuk - the $30K you are pulling out of TSP on April 13th will be income for this year. You really need to pull out about $45K to break even!!!

Your TSP withdraws are Ordinary Income. They are not taxed as capital gains or dividends. That is why the Roth IRA is so powerful. Had you invested in one of those you pay no tax – it had already been paid.


By the way, that is why I don’t think Social Security is going to go broke…
A sacrilegious statement…

Here is why: Boomers who started investing in IRAs and 401(k)s are going to be paying income tax at the age of 80. And, since the tax code changes of 1993, they will be paying tax on Social Security income as well – forever. Neither of these was true for current retirees.

Enjoy…

 

[nnuut]

Wize words Boghie, very wize.
Take a little out every month and it won't hurt so bad.
Transfer to a ROTH a little at a time, but you still end up paying. They got ya and you know where!:nuts:

 

[Boghie]

Random Thoughts on balancing for November/December

I am an ignorant lout

Do not seek advice from me:notrust:

But, unless I get very cold feet, I am going to move more of my G Fund holdings into the S and I funds. Maybe a:

• G: 20%
• C: 40%
• S: 20%
• I: 20%

I think oil prices, Turkey, and the turkeys in Congress will keep stock prices a bit depressed. Things are on a slow draw down, but why!!! Just rumors of more rumors.

October is a lousy time to move money into the market.

This year is probably no different.

I will still have 20% of my holdings making an amazing 1/2 of 1% per month growth in the G Fund. If the knife falls than I will use that at the ‘bottom’ for dollar cost averaging.

November is a great time to be in the market.

Even better than November is December.

I will be fully invested by 11/1.

I want to be in there

 

[Boghie]

Reallocated a bit on market downturn...

As can be viewed on the 'Automated Tracking Software', I did rebalance my TSP account to:

• G: 20%
• C: 40%
• S: 20%
• I: 20%

I completely forgot about my 'promise', but noticed on Drudge that the market was having a very bad day. I noticed it at about 0850 PST and had forgotten my Tracking password - ugggghhhhhh...

But, this great site emailed my home account the password lickity split!!!

I got the trade in!!!

I am planning on rebalancing to stock on dips.

My goal is to be completely in the market by November.

I know it is not safe to catch a falling knife - but, we are not talking about individual stocks. We are taling about the 500 companies in the S&P, the 4500 companies in the Wilshire, and a bunch of international companies. And, I still have 1/5th of my holdings in 'cash'. That should soften a deep crash somewhat.

 

[Birchtree]

Now I like your style.

 

[robo]

Now I like your style.

Sy Harding would agree Birchtree.



http://www.decisionpoint.com/TAC/HARDING.html

http://www.streetsmartreport.com/sts.html

 

[Boghie]

The Random Walk of a Chicken...

Sorry Birchtree...

Things seemed ok in October, but way too choppy now...

Things seem rather crappy now. I think this bad loan stuff will wash out - but when. I think the dollar will strengthen - but when. I think oil is overpriced and will retreat - but when.

Time to take myYTD 12% gain partially off the table.

I am still bullish on the market, but the choppyness is simply stupid – and, I am not a rapid fire trader.

60% - G Fund
20% - C Fund
10% - S Fund
10% - I Fund

By the way, the oil market will damage Europe and China (and even Iran – see China) far more than us. China is forced to subsidize the price of gas because it is a government planned economy - and, thus, 'politicians' define the price of the commodity. Not a good mix. Europe figures in about a 70% tax into their fuel - the better to get everyone on the trains and busses. So, China is going to try to subsidize about $2.00/gallon on every fuel purchase on a national fleet of vehicles that get miserable mileage. So, Europe will take a gallon of gas that currently costs $2.50 and bump it to $8.35. And, what draconian measures are the oligarchs of China going to take to make the Beijing air fresh and clean for the 2008 Olympics. That, folks, is the I Fund…

These are two things that are rather difficult to deal with over the mid to long term, eh

 

[Boghie]

I'm shrinking, and I can't get up!!!

I should have taken my 12% YTD gain completely off the table…

It is now a 9.75% YTD gain…

Yuk, yuk…

And, just when I was thinking of getting back into the C/S/I funds I ended up being much too busy at work, at home, and at play to give myself a warm and fuzzy about getting away from the safety of the G Fund.

Still Holding:

60% - G
20% - C
10% - S
10% - I​

And, now the bozos at TSP want to restrict my ability to dollar cost average assets from my G Fund to my stock funds!!!

Or run to safety from my C/S/I stock funds into the G or F funds.

Remember just how much fun the 2001 recession was when you could only make bi-monthly trades on TSP’s stupid schedule. Many of you lost 40% of your retirement holdings as the market tanked in March and again in September/October.

By the way – I absolutely hate the fact that the Federal Government can ‘borrow’ assets from the G Fund with the promise to repay later. I flushed the full faith and confidence in the Feds down the toilet many moons ago. After watching Social Security expenditures starting to explode I am wondering if the trust funders in Congress will taketh from one Social Security lock box (G Fund) to shore up another lock box (Social Security). That seems to be how they work. Why will it change?

And, it is now too late to fix Social Security through opening up the investment portfolio.

That game is over, Bush was right in that we had to move quickly.

Ten years from now Boomers will be in mid-retirement mode

Consider Social Security a tax – not a benefit.

Now, tax management strategies.

Instead of growth.

 

[Boghie]

A Rebalancing Act, Part 27 or so...

The 'Santa Claus Rally' crashed.

The sled collapsed under the weight of recently purchased 'MacMansions' and Political Populist Uprisings...

Is this the bottom or the top...

Me not know...

But, that Good ol'e 'TSP Inactive' balance seems to be a good center point.

It can rally a bit in an up market...

And, it sags just a bit in a down market...

Here goes:

G: 20%
F: 20%
C: 30%
S: 15%
I: 15%

And, yes, I did surf through many accounts. All over the place. So, to me, that means there is no 'Sentiment' out there to survey, eh...

 

[Boghie]

Yowser (sic???)

Don't know if my transaction posted here months ago that got me a bit out of the market from my last post...

I am buying on the dip.

From:

G: 30%
F: 20%
C: 25%
S: 15%
I: 10%​

To:

G: 20%
F: 10%
C: 35%
S: 15%
I: 20%​

A bit overweighted in the I me thinks, but let's see how it plays out.

I can't seem to find my transaction file...

UPDATE (nice caps, so important):
Got logged into the Automated tracker and got the right balance - including the 2008/03/12 transfer. That flight to safety didn't do me too much good, but it really didn't harm me as well. Was still 50% in the market. Now I am 70% in.

 

[Boghie]

Hey, been a while...

On June 13 I moved to:
60% G
10% F
10% C
10% S
10% I

Then, got real smart (in a 'Deliverance' sort of way) and read Ric Edelman's 'The Lies About Money'. I should say, completely misread it, but...

So, on August 15 I made the switch to what I thought was the proper portfolio for me:

25% G
20% F
25% C
20% S
10% I

I rode that pig all the way down, then realized something.

I didn't map Edelman's portfolio to TSP very well - and, I must have been depressed when answering the questions. He recommended far more C and far less G.

Yippie for Adult Libations or illness or bad schooling.:nuts:

Still lost 15% since August 15.

However, I still have an almost 50% stake in the stock market funds for the big fuel/air explosion to come. Some day very soon we will see an upward blast that will dwarf all recoveries. Short lived or long, me not know.

 

[Birchtree]

My friend - pain is good but greed is better. But you have go through the pain first before you get to experience the joys of greed - that's just the natural order of the world. How do you think our Russian friends are feeling right now - their market was closed more than open last week. I bet their jets have cooled. We are currently looking at pricing that was $17.50 on the C fund that is now $10.32 - what a gift for the foolish and courageous.

 

[Boghie]

Birchtree,

I would have moved far more assets to the stock funds than I did - had I read Edelman's portfolio allocation properly. Allah Akbar, or whatever...

Gotta love the Ruskies and Oil Ticks holding Emergency Summits and stuff. Couldn't have happened to nicer folks, eh. Maybe Putin can sell his 'Russian Century' concept after his economy and market quits for a few days. Very third world of him and his. Oil crapping out and taking a bigger dump than stocks. Lotsa LOPs (Low Output People) crying in the ME and Russia now.

The only thing real annoying is the stupid TSP trading limit. Two trades a month unless you are bailing completely to the G Fund. How the hell can I ‘dollar cost average’ back into the market? I don’t feel like putting everything back in with this volatility, but the option of resetting my allocation only twice under these situations is insane!!! I would like to move my G and F holdings out in three to five IFTs.

 

[Birchtree]

All you can do is utilize space - nothing wrong in taking ones time. Think about our members that have already used up their two IFTs back to the lilly pad this early in the month. Now they may experience some serious anxiety of the opposite kind - a penny every 7-8 days when the C fund runs $1.00 a week to the upside. It's all in the sacrifice.