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The End of Easy Money
It's been easy to be a fixed-income investor. That, though, could soon change.
 
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User Comments
Posted 12:49 PM EST August 24, 2006
Posted by: cranedata
Re: Raud47's post
Normally, moving into bonds when the Fed stops
is a good idea. Unfortunately, this time bonds
didn't fall when the Fed hiked, so there's nothing
to rebound from. I disagree that bonds will do well,
but I wouldn't advise timing the bond market. If you
want income, buy bonds, if you need liquidity, stay
in cash (and do a little of both). Don't time markets!
Pete Crane
Posted 11:48 AM EST August 24, 2006
Posted by: JEFFREYK2000
Mr. Stewart, I thought that your buy point was 2138 on the Nasdaq. The article says your new buy point is 1938. Is this a misprint, or did I miss a column?
Posted 9:02 AM EST August 24, 2006
Posted by: raud47
I wonder if anyone else can respond to the above posts on putting money into bonds and bond funds. The reasoning seems very sound to me.
Posted 11:38 AM EST August 23, 2006
Posted by: MAGIDSON
My Vanguard money market fund is yielding %5.1. I've been staggering one to three year CDs and from 1992 to 2003, I bought one or two ten to twelve year zero coupon treasuries yielding 6 to 8 percent to maturity. My lattered treasuries run to 2016 and will provide about 75% of our yearly exspenses while other maturing assets will take care of the rest. My equities are down to 37@ of the portfolio. Should I increase the equity percent as per recent Smart Money articles suggestions?
Posted 8:53 AM EST August 23, 2006
Posted by: djnorman1
Mr. Stewart, If we know rates will start declining sometime in early next year, what about putting some cash into long bonds (which will yield the largest price increases) & enjoy some nice capital gains upon sale at a later date (perhaps an estimated half way thru the loosening cycle)? In the bad days of 2000-2002, I resolutely stayed in S&P500 index funds & recorded nasty losses;colleagues of mine resolutely stayed in bond funds and scored 10-15% annual gains in that period. DanN
Posted 11:05 PM EST August 22, 2006
Posted by: cranedata
Dear James-
You say, 'Money-market funds were yielding an impressive 3.36%'. My Crane 100 Money Fund Index currently yields 4.98%, and iMoneyNet's Money Fund Report Average was 4.71%. I've also found that money funds have beaten inflation over their lifespan. (Money funds averaged 3.67% for the past 10 years vs. 2.76% for the CPI.) Keep up the good work, but don't mess with cash!
Pete Crane, Crane Data (http://www.cranedata.us)
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