Gumby's Account Talk

[Gumby]

Some observations about bond yields:


Are bonds the next bubble to pop? I can't help but think bond investors in government treasuries historically have fairly conservative viewpoints. These investors seek the safety and security that bonds provide. However, with all the turmoil in the stock market, investors by the droves have been purchasing bonds.......many articles I have read cite a "flight to safety". Do these investors really know what they are buying?
Bond yields are at or near historic lows and prices are just the opposite -HIGH.

Let's for talk sake say this current recession lasts at least another year....it will probably last longer though. What is going to happen to these bond investors in 10 year and 30 year government treasuries when the FED starts to mop up the excess liquidity it has injected into the economy by raising interest rates. Let's say the Fed funds rate is raised back to 5.5% where it was at in the Fall of 2007 prior to the Fed starting to cut rates within 2 years. What is this going to do to the bond prices that people purchased at historic low yields? I think there is going to be major carnage when interest rates rise as well as the inevitible inflation that will occur with the Fed's printing presses running full speed.

Why would anyone buy 10yr or 30 yr bonds without planning on holding them to maturity?

What is a conservative investment anymore?:worried:
Thoughts anyone?

 

[Birchtree]

The time to buy a 30 year Treasury bond was in 1980 when it yielded 15% and sold for $50 - but of course no one wanted them fearing inflation would last forever. Now the panic is about deflation lasting a long time - nope, no bonds for me.

 

[Gumby]

More bad news...will the market shrug it off?



Unemployment claims highest since '82

Number of Americans filing for state unemployment benefits rises to new 26-year high of 586,000, according to Labor Department


More

 

[Gumby]

Looks like the C fund 5 day MA has crossed below the 20 day MA

View attachment 5322


The S fund is close to crossing

View attachment 5325


The I fund is still holding up probably due to the weak dollar

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The F fund is still reaching for the sky. When will it crash down?

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With all the tensions in the middle East, I may jump back to the G fund today, pop the top on a Bud (Inbev) and call it a year from hell.:nuts:

 

[Gumby]

Where we are and where we are going by Denninger.
If he is only half right....the economy is in for a Major shakeup.

More

 

[Mista_Magee]

Back in June 08, who would have thought that the F Fund would beat them all?

 

[Gumby]

Back in June 08, who would have thought that the F Fund would beat them all?

Mista,

I avoided the F fund pretty much all year as it was stuck in a narrow trading range. Sometime, maybe back in June, the return was 0.00% for the year. 20/20 hindsight......this would have been a great fund to have been parked in all year.

 

[Gumby]

Wal-Mart misses sales gain target

Shares of Wal-Mart Stores dropped to $51.38, shucking about 16 Bil in market cap yesterday.
Wal-Mart's missed sales gain and earnings forecast announcement was a big red flag that consumer spending has dropped off a cliff and maybe....just maybe people have realized they can't spend themselves rich$. If Wal-Mart can't make the numbers in these tough times, this economy is much worse than most people think. The market has been acting like the worst is already behind us..........I doubt that. I believe the worst is yet to hit especially if this economy is really a consumer driven one.:worried: Consumers are tapped out.

 

[CountryBoy]

Wal-Mart misses sales gain target

Shares of Wal-Mart Stores dropped to $51.38, shucking about 16 Bil in market cap yesterday.
Wal-Mart's missed sales gain and earnings forecast announcement was a big red flag that consumer spending has dropped off a cliff and maybe....just maybe people have realized they can't spend themselves rich$. If Wal-Mart can't make the numbers in these tough times, this economy is much worse than most people think. The market has been acting like the worst is already behind us..........I doubt that. I believe the worst is yet to hit especially if this economy is really a consumer driven one.:worried: Consumers are tapped out.

Yep Gumby,

Tapped out and wanting to rebuild their retirement. As a baby boomer nearing retirement, my outlook on consumption has drastically changed in the past 2 years. I have been putting every spare dime into my TSP, ROTH's or Individual Accounts preparing for retirement. I'm wondering if other Boomers are doing the same thing, especially if their retirement took a beating from the carnage since last Nov 2007?

A lot of Boomers have really been scorched by this recession and probably will not enter into the consumer market to the degree they did before, since retirement is nearing and with this massive influx of freshly printed money, inflation is something that will also hit us in a few years if not sooner. So the Boomer's will get a double whammy of seeing their purchase power diminish. I think the boomer's are realizing, like Dave Ramsey says, "It's cool to be debt free". I know I feel that way.

If that is the case, I would expect this recession to last longer than even the experts are saying, since the consumer is 60 to 70% of the market.

Just one Boomer's opinion. TGIF

CB

 

[Gumby]

Yep Gumby,

Tapped out and wanting to rebuild their retirement. As a baby boomer nearing retirement, my outlook on consumption has drastically changed in the past 2 years. I have been putting every spare dime into my TSP, ROTH's or Individual Accounts preparing for retirement. I'm wondering if other Boomers are doing the same thing, especially if their retirement took a beating from the carnage since last Nov 2007?

A lot of Boomers have really been scorched by this recession and probably will not enter into the consumer market to the degree they did before, since retirement is nearing and with this massive influx of freshly printed money, inflation is something that will also hit us in a few years if not sooner. So the Boomer's will get a double whammy of seeing their purchase power diminish. I think the boomer's are realizing, like Dave Ramsey says, "It's cool to be debt free". I know I feel that way.

If that is the case, I would expect this recession to last longer than even the experts are saying, since the consumer is 60 to 70% of the market.

Just one Boomer's opinion. TGIF

CB

I agree the purchasing power of the once almighty dollar is going to get whacked in the forseeable future. I am not debt free yet, but am working hard toward that goal. I know that will have to be a great feeling.....something that many consumers will never know. I remember an old saying that went something like "I owe, I owe, so off to work I go". The problem is that many of the people that should be singing this tune have no jobs and will not have even with a huge stimulus package from Uncle. In about 20 minutes, I think we will get a bleak number from the government on the jobs loss. I am curious of how much lower the November number will be lowered. I am thinking the Novemeber number should be North of 550,000.

In my opinion, it is still way to early in this recession to have found the bottom.

 

[CountryBoy]

I agree the purchasing power of the once almighty dollar is going to get whacked in the forseeable future. I am not debt free yet, but am working hard toward that goal. I know that will have to be a great feeling.....something that many consumers will never know. I remember an old saying that went something like "I owe, I owe, so off to work I go". The problem is that many of the people that should be singing this tune have no jobs and will not have even with a huge stimulus package from Uncle. In about 20 minutes, I think we will get a bleak number from the government on the jobs loss. I am curious of how much lower the November number will be lowered. I am thinking the Novemeber number should be North of 550,000.

In my opinion, it is still way to early in this recession to have found the bottom.

I'm also curious about the revised November numbers. And the bottom, I'm looking for the 3rd quarter at the earliest. The stimulus package will not get thru as quick as some want, because the Pols all have different agendas and even the Dems fiscal hawks are concerned about the size of this and future bailout moneys the so called experts said we'll need.

CB

CB

 

[Gumby]

I am going to make my first IFT of the new year and try to catch a slight gain due to the Obama runup. Maybe it will work out.
Going 40%C and 60% S

Here's14U....Thanks for your daily update. I am going to keep a little in C instead of going 100% S

 

[Gumby]

Sure wish the TSP had a bear fund.

In my trading account.....
Sold some SDS @ $72 bought in at $68.75
sold TWM @ $63.25 last Tuesday bought @ $57.99
My WMT got pummeled Thursday....still holding


Still holding MZZ, TWM, SDS, WMT, AEE, AG, DE
Half bear- half bull with a little income sprinkled in there.:nuts:

The TWM small cap bear fund has a lot of potential if the market sells off.

 

[Gumby]

Still hoping for that Obama rally today that may not happen.
It looks like the G fund is the place to be for a while.
Going 50%G, 25%C, 25%S today.

In my trading account.......
Bought some UYG today @ $3.25. Sold some back in December @ $6.75.
I am trying to buy some EFU @ $115 and SDS @ $80

 

[Gumby]

Looks like the EFA is getting the royal treatment today. Will it take out the Nov 20, 2008 low of 35.53 ?


ISHARES MSCI EAFE FD
Last Trade:37.92Trade Time:2:27PM ET Jan 20, 2009

I fund is going to take it on the chin today....probably a BIG -FV also.

 

[Gumby]

All TSP funds remain with 5 day MA getting further below the 20 day MA.
The trend is your friend....and the trend is DOWN.
Probably a good indication of where we are heading..........LOWER.

View attachment 5497

View attachment 5498

View attachment 5499

 

[justbizness45]

Thanks Gumby, nice easy to read chart that anyone can understand.

 

[Gumby]

Market continues to trend down with the 5 day MA below the 20 day MA.
Sell signal for C fund and I fund was on January 13th.
Sell signal for S fund on January 14th.
The trend is your friend.

View attachment 5529

View attachment 5530

View attachment 5531

 

[Gumby]

I don't trust this government buying frenzy.
Going 75G, 10C, 15S @COB today.
Good luck to the brave souls in the market:nuts:

 

[Gumby]

Quote:
Originally Posted by Steadygain
My Laberdoddle - Ella - got a major 'do over' (or whatever the ladies call it). I spent a good 2 hours cutting her hair yesterday and now she is undoubtedly the most beautiful girl on Earth.

Steady.

She is surely not more beautiful than my Laberdoddle Stella.
We have a little trouble keeping the cockleburrs out of her tail.

Smartest dog I have ever been around!