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Frequent Contributor

Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch

Gary:

I bought GLAD below $7/share (around $6.90/share) and sold at $7.50/share. Not bad for a month. This CG is about 8-month yield for this stock. Guess what happened, it dropped again to $7.20/share because it is a pay day for GLAD. I rolled the rest into VGT. I also had more cash and bought 5 shares of QQQ. I bought half of the shares again yesterday. As long as yield hungry investors are there, you can make money because US bonds pay pittance to investors. They know it and I know it. So, I am just using the market to make money.

One more item. I wanted to cut my non-qualified div income in my taxable income. Since I have a lot of both non-qualified and qualified divs from ROTH accounts, I changed my investments last month towards growth and I think that I have cut my div income by 10% on annualized basis.  I will collect the data from the Vanguard monthly statements and evaluate these things this weekend.

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch

I hope year 11 is 20% too.


@Intruder wrote:

@Gary1952 wrote:

So buying QQQ at all time high in a terrible economy, which pays no div, is not considered risky? I don't think many buy treasuries for yield. I think there is risk in everything.

Just looked at GLAD. It crashed in 2008 and 2020 and never recovered. Interesting. I wonder how they are so smart to produce 10% yield?


@ECEPROF wrote:

@royal4 wrote:

up-down.jpg

So... Red = economy  Green = stock market  How much longer can this go on?   Answer: as long as money is dropping from helicopters, spraying from fire hydrants???  yes, no, maybe?


I do not know how you come up with hilarious items everyday to keep me happy. Anyway, thanks.

Chang:

I do not know what is meant by "sell Short." I only use cash investments  - just normal buy and sell. I bought some QQQ, VGT, and GLAD yesterday and today using cash. I am not sure what I will do  with some cash on Monday. I can also use this cash to pay some loans. We will see.


 


10 yr Total return for QQQ is 20.46% . Not too shabby.


 

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch

Note to Intruder: I said "Great Recession."

I said nothing about the Great Depression. 

Thanks.

Bob

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch

So a bond fund currently paying 6% with a good long term record is of no interest to you? Not all bond funds are treasuries.


@ECEPROF wrote:

Gary:

I bought GLAD below $7/share (around $6.90/share) and sold at $7.50/share. Not bad for a month. This CG is about 8-month yield for this stock. Guess what happened, it dropped again to $7.20/share because it is a pay day for GLAD. I rolled the rest into VGT. I also had more cash and bought 5 shares of QQQ. I bought half of the shares again yesterday. As long as yield hungry investors are there, you can make money because US bonds pay pittance to investors. They know it and I know it. So, I am just using the market to make money.

One more item. I wanted to cut my non-qualified div income in my taxable income. Since I have a lot of both non-qualified and qualified divs from ROTH accounts, I changed my investments last month towards growth and I think that I have cut my div income by 10% on annualized basis.  I will collect the data from the Vanguard monthly statements and evaluate these things this weekend.


 

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch


@Gary1952 wrote:

So a bond fund currently paying 6% with a good long term record is of no interest to you? Not all bond funds are treasuries.

When I make 12% with KIO and PCI - 1% per month - every month, why would I be interested US treasuries?

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch


@ECEPROF wrote:

When I make 12% with KIO and PCI - 1% per month - every month, why would I be interested US treasuries?


Simple answer.       LINK

helmut

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch


@helmut wrote:

@ECEPROF wrote:

When I make 12% with KIO and PCI - 1% per month - every month, why would I be interested US treasuries?


Simple answer.       LINK

helmut


Simple Answer: I stopped believing backwards last year and look to the future always because the money you made is already done with. The investment is always about the future. Where are Sears and J. C. Penny? Sears was closed last year, and J. C. Penny will be closed in a few months in my town. Where is Radio Schak? It was closed more than a decade ago. I can go on? My grand daughters use streaming Dinesy, Netflix and Zoom. My family orders stuff using Amazon. I use online orders from Kroger and Walmart. Need I say more?

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch

Are you new to PCI or did you get in after the crash? Looks like you may do some trading. 


@ECEPROF wrote:

@Gary1952 wrote:

So a bond fund currently paying 6% with a good long term record is of no interest to you? Not all bond funds are treasuries.

When I make 12% with KIO and PCI - 1% per month - every month, why would I be interested US treasuries?


 

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch

Oh, BTW, The USA will never go bankrupt. If so you will have more to worry about than owning treasuries.

This is one more reason to get the country needs to get open.


@ECEPROF wrote:

There you have it. It is ok to have this outlook temporarily to save the country from bankruptcy. How many of its employees are still working?


 

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch

Can you still trust these agencies ratings after what I read about them in 2008 meltdown? 

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch

Gary

I traded a lot of CEFs and BDCs for more than an year. I started with a mention by Intruder more than 2 years ago about UTG. I bought them for a few months and made some cash from both distributions and CG. Then, I started trading several CEFs for an year. I got tired of looking for trading opportunities every month with a big spread sheet. Last year, I saw the opportunity in  August in PCI when it went on sale due to "Argentine crisis." I bought something like 5000 shares and kept going up and up until Januray of this year. I collected several thousand shares of PCI. I stopped selling because, after selling, I knew that it would be very difficult to buy sevral thousands of shares at a time.

I had already invested in KIO for a while. I kept reinvesting in KIO and again collected several thousands of shares. I am not selling them either. All of these are in my ROTH accounts and the income is not taxable.

Each gives me an yield slightly more than 1% per month. I reivest these in equities. I have been paying some loans due to balance transfer at 0% recently and HELOC loans. No effect on my taxes. Sometimes, I buy several hundred shares of BDCs and sell them for CG. Sometimes, I reinvest. When I reinvest, I buy several hundred shares each time. Right now, even though PCI and KIO are down, the distributions are not down. I have already enough distributions that made up my losses. Since they are going up, they are becoming more expensive. However, KIO (CEF of corporate bonds) goes at discount even now. I am not worried about the actual balance because these CEFs are very solid and have been good to me. I can expand into other other popular Pimco CEFs but I am not interested. Most people use Pimco CEFs as annuities for income except these CEFs pay almost double of TIAA annuties that were annutized some 20 years ago. I do not know if you remmeber Regan times. The interest rate was 12% and the annuities were a good choice. I do not think we will ever see FED rates going beyond 3% in the foreseable future and fixed income based on interest income using US Bonds will not provide living income. I feel bad for moms and pops who depend on the interest income. Indeed, I prefer divs because they grow around 7-10% per year.

The bottom line is: Does not matter what type of investments you choose, will it grow, and if so, what is the growth rate? If it grows, you can live easily. Otherwise, it is difficult.

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Re: Ouch: United States Outlook Revised to Negative From Stable by Fitch


@ECEPROF wrote:

@helmut wrote:

@ECEPROF wrote:

When I make 12% with KIO and PCI - 1% per month - every month, why would I be interested US treasuries?


Simple answer.       LINK

helmut


Simple Answer: I stopped believing backwards last year and look to the future always because the money you made is already done with. The investment is always about the future. Where are Sears and J. C. Penny? Sears was closed last year, and J. C. Penny will be closed in a few months in my town. Where is Radio Schak? It was closed more than a decade ago. I can go on? My grand daughters use streaming Dinesy, Netflix and Zoom. My family orders stuff using Amazon. I use online orders from Kroger and Walmart. Need I say more?

@ECEPROF 

Sorry if my reply sounded rather glib but I don’t see your point.  In your post you referred to return then in the follow-up, post you are talked about risk.

In both returns and risk I’m not sure how you compare leveraged CEF of lower quality bonds with a long-term treasury ETF and find a safer or higher long-term return. 

I have no idea of your investment strategy but just about any asset will have good years followed by bad years, so I pair my long-term treasury ETF with equities.  I’ve found that one or the other is having a bad year the other is normally doing extremely well. Of course, there are always a year when nothing works so I try to keep enough cash to soldier through the down times.  Fortunately, that does not happen very often.

helmut


 

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