birb_cromble
No bio...
User ID: 3236
birb_cromble
4hr ago
Are you sure you want that kind of autism?
birb_cromble
5hr ago
If you're feeling bold, there's also XONE
birb_cromble
7hr ago
My understanding, corroborated by some people in previous threads, is that you generally want the longest duration you can manage without going over the date when you need it.
A 52 week treasury bill coupon equivalent is over 4% right now. That's not awful if capital preservation is a big deal. To get higher than that, you'd be looking at commercial debt like JAAA, and even then you'd have to consider the tax implications.
birb_cromble
9hr ago
First, say a prayer of thanks that she's dispositionally a saver.
I do that pretty much every day.
Since she's aware of inflation, I've been gently pushing the idea of SGOV to her. I'm emphasizing the fact that her bank is likely using treasuries to fund the interest on her HYSA, so buying SGOV just cuts out the middle man. My hope is that if she can see it grow for a while without any catastrophes, she might accept more risk and investments that have a longer time horizon.
Do you believe you're so bad at controlling yourself that you will spend more than you can afford if you use a credit card?
I've met a surprising number of people over the years who seem perfectly functional, only to later learn that they have five figures of credit card debt. I'd rather not even put myself in a position where I could find out I'm that kind of person. I've got a lot of people in my family with addiction and impulse control problems, and putting a fence around temptation has kept me from finding out I have the same problems.
birb_cromble
2d ago
You know what drives me apeshit? I've worked on a dairy farm, and an orchard. Sure, it's hot, dirty, and uncomfortable work, but it wasn't really any worse than a dinner rush in a commercial kitchen on a Friday night. I really get the impression that a lot of people assume manual labor is worse than the ninth circle of hell.
birb_cromble
2d ago
Then where exactly is this mass of currently non working American citizen
In the case that you are actually asking this question seriously, and not as a half-assed attempt at a rhetorical dunk, they're in the Appalachians. I have some family and old acquaintances in ${UNDISCLOSED}. One of the largest employers in the area has historically been a prepared food facility, which recently came under new management. This new executive team has been doing rolling waves of layoffs, and regularly furloughing workers who they retain an attempt to force them to quit. For the last year, both a relative and a friend have repeatedly noted that despite the rolling layoffs, the overall workforce at the plant has not decreased. It has, however, started to feature an increasingly large number of five foot tall Guatemalan men in their 20s who don't speak English, but present work papers claiming that they're John Billings from Madison, Wisconsin. It's agonizingly obvious that they're hiring people with stolen identities.
My cousin got laid off recently, and he's looking at trying to file some sort of suit against the company. I doubt it will go anywhere. He has placed upwards of thirty job applications in the fields of construction, municipal maintenance work, security, and HVAC. He hasn't heard a damned thing back from any of them. In the interest of full disclosure, I will admit that he has a felony drug charge on his record from 20 years ago, but in that area, that's not really uncommon.
You're welcome to pretend this is all about "jobs nobody wants to do", but believe me when I tell you it's climbing up the food chain.
birb_cromble
2d ago
I'm not a fan of this policy at all. It incentivizes the kind of person who wants to be in New York to be somewhere other than New York. Given that I live somewhere other than New York, this presents an unacceptable risk of me being exposed to the kind of person who wants to be in New York.
birb_cromble
2d ago
You know what's more American than having an all-American name?
Having a funny name and being so goddamn American about it that you tell pearl-clutchers to go fuck themselves. One of the most patriotic, overwhelmingly American people I know is a Korean man who goes by "Gun".
America isn't a guy with a proper Anglo-Saxon WASP name. It's not a collection of clothes. It's a commitment to the belief that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed.
You're in America now, and America built itself out of exiles and outsiders who held an ideal that no other country in the would would accept. You're no different. Be proud of your name. Carve out a space for yourself and remind us what America is.
birb_cromble
3d ago
I'll try to see if my library has a copy. It sucks when someone comes to me for advice and I can't offer anything.
birb_cromble
3d ago
That’s why I would suggest a bond: it’s liquid in a way that individual bonds are not
Do you mean a bond fund?
birb_cromble
3d ago
I am violently skeptical of EA as a concept due to the events of the last several years. Between Situational Awareness, FTX, the castle debacle, the zizians, and... just the entire AI industry right now, I think setting my money on fire would result in more net good being done than giving it to anyone who is EA-affiliated.
With that out of the way, are you specifically looking for EA charities, or are you looking to maximize the utility of your charitable giving? If it's the former, I absolutely cannot help you. If it's the latter, can you explain why you're taking that approach over donating to a local charity that has a good reputation, that's close enough to scope out yourself?
For example I sell options. Right now, I have a notional risk of 7x-8x my taxable portfolio’s actual value.
You sir, have balls of solid rock. There is absolutely no way I could bring myself to do that.
Looking back, the fact that I invest at all has more to do with an accident of fate than anything. I grew up dirt fucking poor. I don't mean "we couldn't afford a new car" poor. I mean "we had to cut slits in my shoes and tape them up because I outgrew them and couldn't afford replacements" poor, or "had a big, filling glass of water for dinner at least once a week" poor.
My first job out of college didn't pay handsomely, but it was enough money that I could dump 13% of my paycheck into my 401(k) and still feel richer than I had ever felt in my life. Every time I get a raise, I increase my savings one way or another and keep my spending power constant.
Absent that, I'd probably be like your brother in law. The terror of being poor stays with you wherever you go. I still regularly wargame what would happen if I lost my job, and wake up at night thinking that I'm going to lose my home.
I think about my relatives who haven't been able to get out. What advice do you offer to somebody who's still working retail in his 30s and has been turned down for his last ~50 applications to better jobs? "Just invest in SPY, bro" is going to bounce off their real-life circumstances so hard that it probably does more harm than good.
birb_cromble
3d ago
I've tentatively brought up the idea of something like SGOV to her, framing it as a slightly better alternative to a savings account. She's suspicious, but hasn't completely shut me down yet.
birb_cromble
3d ago
Years ago HR demanded that I decorate my cubicle as well. I papered the entire thing with printouts of the most egregious bug reports in our system along with our most embarrassing sections of code. The diktat was rescinded soon after.
One common friction point that keeps coming up in these threads is something that I can't clearly name, but seems to be the friction between one person's perceived optimal behavior and another person's risk tolerance. One person will say that they are doing something, and another person will comment that the first poster is Doing It Wrong because they believe there is a more optimal path that they could take. It's a very binary thing that seems common in the Internet in general. I think it comes from a benevolent place, but it seems like it can push people off from the topic entirely as much as it can educate them.
I've been thinking about that lately because of events in my personal life. My partner is a fairly responsible saver, but she's not really investing. She's in the upper half of her age group for net worth and doesn't have any debt, but I worry that inflation is going to eat those savings over the long term. I've gently tried to get her to consider moving some of that money into funds over the years, but for her, it's entirely too much risk. I've not really pushed on it because what she's doing is better than doing nothing, and nothing is her alternative right now.
For somebody who has that extreme level of risk aversion, what options are there that beat a HYSA? Browbeating her into equities isn't going to fly.
On a similar topic, are there "non optimal" things that you do financially, but you do them anyway?
- I pay ahead on my mortgage, even though the interest rate is "only" 3.75%.
- I hold some dividend stocks and funds, and even commit the cardinal sin of holding them in a taxable brokerage account.
- I don't use credit cards outside of the bare minimum necessary to keep them active.
In all three cases, it's entirely a psychological thing for me, and I recognize this. In the first two in particular, it's still better than not doing anything at all
birb_cromble
4d ago
Real talk - I got my laws mixed up and thought you were suggesting I'd shit my pants so hard I took off like a rocket.
birb_cromble
5d ago
With how volatile the KOSPI has been relative to the trends I'm seeing, I'm not willing to be correct and lose my ass on margin because my timing was wrong. My risk appetite just isn't high enough for that.
For right now I'm writing down what I would do on paper. Once I have enough data over time, I'll find out if I would have made money or not. Everybody thinks they're a genius in a bull market, and I'd rather not find out the hard way that I'm on that list.
birb_cromble
5d ago
Avantis is a bunch of fund managers who originally worked with Dimensional Funds. They use a strategy for their value funds that is technically considered active, but it's not very hands-on at the human level. They define an algorithm that can quantify "value", then maintain fund holdings based on that algorithm. Their prospectuses go into more detail, but the biggest element seems to be free cash flow vs share price and shares outstanding. Obviously there's a lot of proprietary witchcraft involved, but I generally like the idea of investing in companies that make more money than their share price reflects. I'm a dinosaur like that. In the rare instances where I buy individual stocks, those are some of the same things I look for in a company.
birb_cromble
5d ago
"Don't buy the cast recording of Slam Frank, it omits crucial songs from the musical, and it feels like the Kickstarter to get it released and the fact that it costs $20 and isn't up on YouTube or Spotify are cynical ways to turn rage bait for a mediocre work into profit", then I suppose that's fair
As a fellow musical-enjoyer, this is actually really useful. Thanks.
birb_cromble
5d ago
Listen man, I'm not trying to be an asshole, but you're presenting a review of a work where you:
- Did not attend a performance
- Did not read a score of the song you didn't hear
- Relied on secondhand retellings of the song you did not hear
From that, you managed spill 655 words worth of ink about it to say it's disappointing. You're making an assumption that the stage performance ads no value over your partial recording, and you're making an assumption that the musical aspects of the final song don't shore up what you perceive to be lyrical shortfalls.
That's like claiming that a steak is bad because it felt gross when you touched it with your fingers. You might be right, but if you are it's probably not because of your methodology.
birb_cromble
6d ago
That tracks. I can destroy some Mexican food.
birb_cromble
6d ago
That's funny. I saw all the same things and my gut reaction was to run screaming in the opposite direction.
birb_cromble
6d ago
I'm not entirely sure about that. Maybe it's a cultural thing, but a lot of people I know tend to eat their way through vacations. Mexico seems to be the worst for that, for some reason.
@stolen_brawnze asked me to info dump what I've learned about fixed income over the last several months. I'm on the stationary bike and I'm getting bored, so let's go.
If anything here is wrong, please correct me and I'll update the post. I'd rather somebody tell me I'm wrong than spread misinformation.
At the highest level, I've been looking at government debt and corporate debt.
Government debt, like the name suggests, is issued by government entities. At the federal level, that includes treasuries, and below that, you're mostly looking at municipal bonds. Treasuries are considered the gold standard for low risk investing. Municipal bonds usually offer lower rates, but are are tax exempt at the federal level. In most states, they're exempt from state tax as well if the bond is issued by your state if residence as well; if you're high income or high net worth, that can be a real win.
Commercial debt is a lot more varied. Unlike sovereign nations, corporations generally don't have standing armies and taxable citizens to guarantee their loans. Instead, there are a handful of private groups that rate corporate credit. Generally, riskier companies offer higher rates to entice lenders. Safer companies can get away with lower rates, because they're probably not going to go out of business before the bond matures.
Bonds are great, because if the company doesn't default, you'll always get back your face value, but they're kind of a pain in the ass to hold individually. Bond funds offer an alternative to this, but they come with their own risks. Bond funds hold rolling collections of bonds and generally returns distributions monthly as ordinary income. Bond funds that hold significant amounts of US treasuries are usually state tax exempt.
Bond funds that hold significant amounts of municipal bonds also carry a tax advantage.
Bond funds have an average duration, which is the weighted average time it takes for a bond in the fund to recover its face value. Longer durations tend to offer better returns, but this is not always a guarantee. Longer durations also carry more risk, because the interest rate is locked into the bonds that are held by the fund. When you hold a fund at X%, it's not as attractive if the same issuer offers the same bond at X+1%. Rate increases tend to make the share price of a bond fund drop. Conversely, rate drops tend to make older bonds with higher rates more attractive, which makes the share value of a bond fund rise. If you're using a bond fund for savings, you should favor shorter durations. If you're using a bond fund for income, duration matters less because the yields tend to even out. Roughly speaking, a 1% increase in rates will cause the share price of a fund to drop by a number of percentage points equal to the fund's average duration. This is why 2021-2023 were so terrible for bonds. The fed jacked up rates seven times in rapid succession and absolutely obliterated a lot of bond funds.
On the corporate side, there are also collateralized debt funds. Collateralized debt funds hold a basket of debt (mortgages are common) and divide the returns into tranches. When everything is going well, everybody gets paid, with the lower tranches getting a higher rate. When things go shit wise, the tranches might not get paid. The highest tranche is AAA, and these funds tend to be very safe by the standards of corporate debt.
Tickers
Ultra Short term treasuries: I like VBIL. SGOV is also good. Average duration is about a month, so the share value is extremely stable. You can see a clear sawtooth pattern every month as the value builds up before a distribution. I like this as an enhanced savings account that has state tax advantages.
Short term treasuries: SCHO and VGSH. I haven't found a particular use for these. Average duration is just shy of two years.
Weird outliers: Bondbloxx is doing interesting under XHLF and XONE. These offer a six month and one year duration, respectively. I'm also looking at BOXX, which is doing some sort of synthetic fund that converts returns into capital appreciation for tax efficiency. I'm still not sure how that works or how it's legal.
Collateralized debt: My go to here is JAAA. It has a short duration (about 2.5 months right now) and a decent return. Be aware that the distributions are considered ordinary income. If you want more return, there's also JBBB. If you want alternatives there's also PAAA and CLOA.
Short term corporate debt: I like VUSB and I hold it as ballast in my HSA. It has an average duration of about 1.9 years.
I want to put my balls on the table: If you're bold, there's FALN. FALN is a junk bond fund for companies that have lost their investment grade rating. The thesis for the fund is that companies that were once investment grade are more likely to get their shit together and pay you than their bond yields would suggest.
Municipal bond funds: Not every state has its own municipal bond fund. If you want a national grab bag for the federal tax advantage, there's VTEB. For particular states, California has CMF. New Jersey has FNJHX. Pennsylvania has FTPA. New York has NYF. You'll probably need to check your own state of residence. These are only usually worth it if you can find one for your own state or if you're fuckin' loaded and need to keep your tax burden down. Municipal bond funds tend to have a very long duration because they tend to fund large projects.
I don't want to think about this shit: BND or BNDW. The former is a snapshot of the whole US bond market. The latter is the whole global bond market.
I am very patient: EDV is a treasury ETF with an average duration of twenty God damned four years. The 30 day yield is 5.1% though, so if you're looking for income it's not bad.
Other notables:
Bogleheads like USFR, which is a fund that holds floating rate notes instead of fixed rate treasuries. It has a slightly better 30 day SEC yield than SGOV.
JSI was something of a fixed income darling earlier this year, but it's been having a hard time, having lost 2.68% of its share price YoY. It does have a 5.83% SEC yield, however.
VTIP is interesting. It holds Treasury inflation protected securities. TIPS have a base rate, then a second additional rate that varies based on inflation. In theory, it should help you hold on to value if inflation spikes. In practice, the government lies about inflation and even if they didn't you'd get taxed on those returns. I'm not sure how it would fit into my portfolio.
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