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Playing the I fund
- Thread starter clester
- Start date
James48843
Well-known member
Nikkei slightly down, CAC, DAX and FSTE up a small amount.
Dolllar slightly down vs. the Yen and Euro.
An UP day for the I fund, but only a little.
(i am rebalancing today, lighting up on "I", and moving into "S" agressively, and "C" with a little.)
Dolllar slightly down vs. the Yen and Euro.
An UP day for the I fund, but only a little.
(i am rebalancing today, lighting up on "I", and moving into "S" agressively, and "C" with a little.)
fabijo
Well-known member
Looks like the I fund stayed even, but the dollar just dropped. Let's try to think like Barclays.
The EAFE is down 0.025%. The dollar just dropped almost 1%. If the short-term investors want to jump on that gain for tomorrow, they should get in tonight at the price before the dollar dropped so that tomorrow would give them a gain. To stop people from taking advantage of the stale prices, I would put about a .8% to 1% FV and make the I Fund about 19.10.
Anybody else got any guesses?
The EAFE is down 0.025%. The dollar just dropped almost 1%. If the short-term investors want to jump on that gain for tomorrow, they should get in tonight at the price before the dollar dropped so that tomorrow would give them a gain. To stop people from taking advantage of the stale prices, I would put about a .8% to 1% FV and make the I Fund about 19.10.
Anybody else got any guesses?
SkyPilot
Well-known member
fabijo said:
This will make you crazy for a while, then you will come to embrace the banality of it all, and finally acceptance and a longer term view. Right now it appears you are in the bi-polar joy and grief cycle. It cannot be maintained for long. Been there, it's cool!
Don't worry, be happy
fabijo
Well-known member
SkyPilot said:This will make you crazy for a while, then you will come to embrace the banality of it all, and finally acceptance and a longer term view. Right now it appears you are in the bi-polar joy and grief cycle. It cannot be maintained for long. Been there, it's cool!
Don't worry, be happy
What do you mean will drive me crazy? It's been done. One minute, I like my plan, the next minute I'm afraid of it! I'll just go to G and wait for the next dip in the markets. Then I can tell myself that I'm buying more shares than I had. That thought should appease my bipolar cycles for a while.
Might get a reprieve tonight or tomorrow?
FundSurfer
Well-known member
Berny strikes again! Economy slowdown could be more important than inflation at next fed meeting, thus the dollar dropped like a rock this afternoon. Too late for us to take advantage though.
http://money.cnn.com/2006/07/26/news/economy/fed_beigebook.reut/index.htm
http://money.cnn.com/2006/07/26/news/economy/fed_beigebook.reut/index.htm
Easy read for those who need additional information on what moves the I fund
http://www.nytimes.com/2006/07/27/business/worldbusiness/27scene.html?ref=business
Economic SceneThe Global Interest Rate Dance, With Bernanke Leading
By HAL R. VARIAN
Published: July 27, 2006
NOW that the World Cup and the Tour de France are behind us, the most exciting global spectator sport is watching Ben S. Bernanke: Will he raise interest rates in August or not? And what does his decision mean for world financial markets?
When the Fed raises interest rates, global investors find dollar-denominated investments more attractive. This increased demand for American assets tends to raise the value of the dollar.
But the higher the value of the dollar, the more expensive American goods become for foreigners and the cheaper foreign goods become for Americans, worsening the balance of trade. Eventually, a highly valued dollar can lead to a drop in production in industries that are sensitive to imports or depend on exports.
International financial markets respond to interest rate changes almost instantaneously, while the real side of the economy — production, employment, imports and exports — adjusts over many months or even years.
Such a policy runs the risk of stimulating inflation. The easy-money policies in the past few years have had a surprisingly small impact on wages, in part because of the threat of jobs moving to countries with lower labor costs. But if the dollar fell far enough, foreign labor would no longer be a bargain, giving domestic workers more leverage in wage negotiations.
In this chain of events, an inflationary spiral would become a real possibility, making the cost of a stumble on policy higher. Let us hope central bankers can keep dancing in step as they move interest rates back to normal levels.
Hal R. Varian is a professor of business, economics and information management at the University of California, Berkeley.
http://www.nytimes.com/2006/07/27/business/worldbusiness/27scene.html?ref=business
Economic SceneThe Global Interest Rate Dance, With Bernanke Leading
By HAL R. VARIAN
Published: July 27, 2006
NOW that the World Cup and the Tour de France are behind us, the most exciting global spectator sport is watching Ben S. Bernanke: Will he raise interest rates in August or not? And what does his decision mean for world financial markets?
When the Fed raises interest rates, global investors find dollar-denominated investments more attractive. This increased demand for American assets tends to raise the value of the dollar.
But the higher the value of the dollar, the more expensive American goods become for foreigners and the cheaper foreign goods become for Americans, worsening the balance of trade. Eventually, a highly valued dollar can lead to a drop in production in industries that are sensitive to imports or depend on exports.
International financial markets respond to interest rate changes almost instantaneously, while the real side of the economy — production, employment, imports and exports — adjusts over many months or even years.
Such a policy runs the risk of stimulating inflation. The easy-money policies in the past few years have had a surprisingly small impact on wages, in part because of the threat of jobs moving to countries with lower labor costs. But if the dollar fell far enough, foreign labor would no longer be a bargain, giving domestic workers more leverage in wage negotiations.
In this chain of events, an inflationary spiral would become a real possibility, making the cost of a stumble on policy higher. Let us hope central bankers can keep dancing in step as they move interest rates back to normal levels.
Hal R. Varian is a professor of business, economics and information management at the University of California, Berkeley.
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