Investing Thread

[Goose]

Hards

Sounds like your Mom and Dad did it the right way. There are plenty of good stories out there, but I am afraid there are going to be a lot of very disappointed boomers in the upcoming months and years.

[Hards Alumni]

Hards

Sounds like your Mom and Dad did it the right way. There are plenty of good stories out there, but I am afraid there are going to be a lot of very disappointed boomers in the upcoming months and years.

Absolutely.  I have many employees that are approaching retirement, but continue to stick around 'another year' because they are being realistic with themselves that they cannot afford to actually retire.

[jesmu84]

The commentary on what the Fed or Gov have done in the last 20+ years makes me chuckle.

Who/why were those decisions made?

I have to believe they were decisions as the result of influence by the wealthy/powerful - wall street, global corporations, etc.

It sure seems to be at a detriment to the US as a whole.

We reap what we sow.

I certainly hope current or recent retirees aren't significantly impacted by the recent economic downturn

[Goose]

jesmu

What commentary makes you chuckle?

[Tortuga94]

I'm sure I mentioned it in the retirement thread, but pensions, SS and other guaranteed income sources are key to retirement. Countless studies have shown that the people who are happiest in retirement and live longer in retirement tend to have guaranteed income sources, incomes they can't outlive.
Early in my career I had the mindset that retirement planning was all about accumulation of assets, but then I met a guy that basically said, no, his statement to me was, you don't retire on assets, you retire on income.
His point was to make sure you have enough guaranteed income streams to cover your essential expenses, if pension/SS or dividend income can do that great, if not consider using a portion of your assets to buy an annuity.
You can then use your other non-guaranteed assets to fund your discretionary expenses.
 

[MU82]

I'm sure I mentioned it in the retirement thread, but pensions, SS and other guaranteed income sources are key to retirement. Countless studies have shown that the people who are happiest in retirement and live longer in retirement tend to have guaranteed income sources, incomes they can't outlive.
Early in my career I had the mindset that retirement planning was all about accumulation of assets, but then I met a guy that basically said, no, his statement to me was, you don't retire on assets, you retire on income.
His point was to make sure you have enough guaranteed income streams to cover your essential expenses, if pension/SS or dividend income can do that great, if not consider using a portion of your assets to buy an annuity.
You can then use your other non-guaranteed assets to fund your discretionary expenses.

Unfortunately, pensions are going the way of the wooly mammoth. Fewer and fewer companies offer them, and many that still have pensions for older employees make newer hires ineligible for them. So that leaves employees with self-funded options like 401ks, and many companies don't even match any contributions. Annuities come with a variety of fees and limitations, so they're a far from perfect alternative.

My wife and I will get some pension money, and I also have set up our stock portfolio to pay out fairly significant dividend income. There are good and bad things about Dividend Growth Investing, but one of the good things is that even when the stock market goes down, an income stream continues to grow.

[ZiggysFryBoy]

jesmu

What commentary makes you chuckle?

Whatever YouTube vids or the Jacobin website is telling him to chuckle st.

[tower912]

An actual attempt at humor.  Good job, ziggy.

[TSmith34, Inc.]

An actual attempt at humor.  Good job, ziggy.

An attempt, but an abject failure as usual. Bitterness isn't really humor.

[MU Fan in Connecticut]

I think it depends.  I know companies who have not changed prices cause they have, lets say a 50% markup, to their end customer.  Thats a bit rich most of the time.  Now that their costs have gone up 10%, they're tempted to raise their prices, but that may also trigger an evaluation of overall costs by the end customer, so they'll take short term heat hoping things temper down and they can keep their favorable long term markup.

And FWIW, not all price competition is equal.  For example, in my industry niche, we are the clear quality leader.  But our main competition is involved in a variety of different product lines and their competitive product to ours is usually a loss leader, or attempted add-on.  So we need to be VERY careful moving prices due to market factors, or inflation, cause while good, reliable customers understand the difference and value, others view it as a keeping up with the Jones' box tick and will take any excuse to cut costs.  Its stupid, but sometimes that's business.   Same as when new management boots a long time reliable supplier just to shake things up and put "their mark" on a business.

We haven't raised prices but as I mentioned last week our customers get a Fab + Average Monthly Metal value so the total price floats up when metals do.

[ZiggysFryBoy]

An attempt, but an abject failure as usual. Bitterness isn't really humor.

🐷🐷

[MU82]

Question for Bitcoin/crypto folks: Are you buying more here, selling, standing pat? Are you as enthusiastic about crypto as you had been?

I am a crypto agnostic.I have considered buying some but haven't because I decided it doesn't really fit my buy-and-holdish investment philosophy. But I am not one who makes fun of others for owning it, and I have friends who invested several years ago who are still way up -- and still enthusiastic about Bitcoin and a couple other big crypto players while critical of the likes of Dogecoin.

I will say that I am skeptical of Fidelity's decision to make crypto available within 401k plans. Many who invest only through 401ks -- and that covers a wide swath of U.S. investors -- do not follow the market very closely.

[Skatastrophy]

We haven't raised prices but as I mentioned last week our customers get a Fab + Average Monthly Metal value so the total price floats up when metals do.

That sounds like very transparent pricing.

Fab should be crawling up with the increased cost of labor?

[MU Fan in Connecticut]

That sounds like very transparent pricing.

Fab should be crawling up with the increased cost of labor?

We're kind of a niche business.  It's pretty much industry standard especially when it comes to copper alloys. 
Our labor is not really going up.  We had some long tenure people retire and replaced by people who make way less even though we greatly increased the starting hourly rate to be more competitive.   Plus like someone else said, if we increase too much we will lose business.  We sell internationally and international customers prefer our wire for quality reasons as long as our price is in the neighborhood of Asian suppliers, but if we go too high they will switch for the lower price and eat the high scrap rate from the Asian suppliers. 

[Skatastrophy]

We're kind of a niche business.  It's pretty much industry standard especially when it comes to copper alloys. 
Our labor is not really going up.  We had some long tenure people retire and replaced by people who make way less even though we greatly increased the starting hourly rate to be more competitive.   Plus like someone else said, if we increase too much we will lose business.  We sell internationally and international customers prefer our wire for quality reasons as long as our price is in the neighborhood of Asian suppliers, but if we go too high they will switch for the lower price and eat the high scrap rate from the Asian suppliers. 

Very interesting. In B2B SaaS our average cost per sales rep has increased 2x-3x. Those tend to be high-ish turnover roles and labor knows they're in high demand. It's driving our CAC through the roof. Even though net retention is high, growth-stage companies need to acquire new customers like crazy to keep pace.

It sounds like your biz/industry is established enough that it's more about growing accounts, not losing accounts, and maybe poaching a few from your frenemies?

[Tortuga94]

Unfortunately, pensions are going the way of the wooly mammoth. Fewer and fewer companies offer them, and many that still have pensions for older employees make newer hires ineligible for them. So that leaves employees with self-funded options like 401ks, and many companies don't even match any contributions. Annuities come with a variety of fees and limitations, so they're a far from perfect alternative.

My wife and I will get some pension money, and I also have set up our stock portfolio to pay out fairly significant dividend income. There are good and bad things about Dividend Growth Investing, but one of the good things is that even when the stock market goes down, an income stream continues to grow.

It's great that you can rely on pensions and SS, two guaranteed sources of lifetime income. Dividend income is nice too, but of course not guaranteed, if you recall after the financial crisis of 2008, many companies eliminated or reduced their dividends, so while I am a big believer in buying dividend paying stocks, I also think annuities can be a nice tool in retirement planning. I understand that there are expenses associated with them, but you are buying something with that money, a guaranteed lifetime income that can sometimes be as high as 6%, depending on age. It's not something I recommend for everyone, but for some clients they make sense.

[Hards Alumni]

Question for Bitcoin/crypto folks: Are you buying more here, selling, standing pat? Are you as enthusiastic about crypto as you had been?

I am a crypto agnostic.I have considered buying some but haven't because I decided it doesn't really fit my buy-and-holdish investment philosophy. But I am not one who makes fun of others for owning it, and I have friends who invested several years ago who are still way up -- and still enthusiastic about Bitcoin and a couple other big crypto players while critical of the likes of Dogecoin.

I will say that I am skeptical of Fidelity's decision to make crypto available within 401k plans. Many who invest only through 401ks -- and that covers a wide swath of U.S. investors -- do not follow the market very closely.

I'm still way up, but don't have a ton of cash sitting around to throw more at it.  The LUNA story and UST story is interesting.  Worth a read.

Personally, I don't buy the alt coins.  I primarily own BTC and ETH.  A couple of bucks here in there in other projects, but not enough to worry about.

BTC goes through these cycles every couple of years and people (and the media) absolutely freak out.  And then what has happened every time?  It rebounds and finds a new ATH.

No offense, MU82, but if I was your age and retired I'd only be doing a few bucks here and there.  It is still and will continue to be a very volatile asset.  At least until it can untether itself from the stock market... which may be never.

[MU82]

I'm still way up, but don't have a ton of cash sitting around to throw more at it.  The LUNA story and UST story is interesting.  Worth a read.

Personally, I don't buy the alt coins.  I primarily own BTC and ETH.  A couple of bucks here in there in other projects, but not enough to worry about.

BTC goes through these cycles every couple of years and people (and the media) absolutely freak out.  And then what has happened every time?  It rebounds and finds a new ATH.

No offense, MU82, but if I was your age and retired I'd only be doing a few bucks here and there.  It is still and will continue to be a very volatile asset.  At least until it can untether itself from the stock market... which may be never.

I'm not the least bit offended with your last paragraph. Not sure why I or anybody else would be. I try to keep things simple in investing.

I did just read this morning about UST. Crazy effen stuff!

I wish you good fortune.

[MU82]

It's great that you can rely on pensions and SS, two guaranteed sources of lifetime income. Dividend income is nice too, but of course not guaranteed, if you recall after the financial crisis of 2008, many companies eliminated or reduced their dividends, so while I am a big believer in buying dividend paying stocks, I also think annuities can be a nice tool in retirement planning. I understand that there are expenses associated with them, but you are buying something with that money, a guaranteed lifetime income that can sometimes be as high as 6%, depending on age. It's not something I recommend for everyone, but for some clients they make sense.

We do actually have an annuity-like product: TIAA Traditional. My wife bought some of that during her time as an RN at Chicago Children's, and we just left it there when we moved to Charlotte. I like that it provides ballast to an otherwise stock-centric portfolio while providing guaranteed income for life with a very solid payer. And we pay very minimal fees, so that's nice.

About 75% of dividends in S&P 500 stocks were either maintained or increased during the Great Recession, which was the second-worst financial crisis in U.S. history and the worst that most people who are still alive ever went through. So you're right, dividends aren't guaranteed ... but if you saw the list of stocks I own, I think you'd probably be willing to bet (as would I) that the vast majority of them won't be cutting their dividends during the next recession, either.

And yes, we're very fortunate that we'll get some pension money. Our kids will not be as fortunate.

[LAZER]

I'm still way up, but don't have a ton of cash sitting around to throw more at it. The LUNA story and UST story is interesting.  Worth a read.

Personally, I don't buy the alt coins.  I primarily own BTC and ETH.  A couple of bucks here in there in other projects, but not enough to worry about.

BTC goes through these cycles every couple of years and people (and the media) absolutely freak out.  And then what has happened every time?  It rebounds and finds a new ATH.

No offense, MU82, but if I was your age and retired I'd only be doing a few bucks here and there.  It is still and will continue to be a very volatile asset.  At least until it can untether itself from the stock market... which may be never.

Can you share?

[MUBurrow]

Question for Bitcoin/crypto folks: Are you buying more here, selling, standing pat? Are you as enthusiastic about crypto as you had been?

Only adjacent to your question because I was in on COIN early, but don't actually trade crypto itself.  But I'm trying to time the bottom and double down here pretty shortly.  To Hards' point, this is just the volatility of crypto, so for me the real bet is "is crypto here to stay?"  I think the answer is yes, even though I think it will only play a secondary/cyclical role to other currencies and investments.  But even that, combined with what I think is Coinbase's still relatively strong position compared to other exchanges, is good enough for me to get in at this low.

[TSmith34, Inc.]

Can you share?

Here's one link
https://diginomica.com/defi-meltdown-luna-ust-and-other-tokens-plunge

The massive, screaming, red flag line in the article?

"In the case of the Terra-ble twins, it transpired that one reason for the collapse was that roughly three-quarters of the UST in circulation was on the Anchor platform, a decentralised lending and borrowing protocol – itself built on the Terra chain.

Anchor promises investors a stable interest rate of up to 19.5 percent. In other words, people were incentivised to be loyal to UST and Luna not because of those coins’ own attractiveness, but because Anchor itself promised high yields and a hedge against market volatility."

Anyone believing that they were going to get a promised 19.5% interest rate was a sucker, unfortunately.

[Skatastrophy]

There's going to be (or should be) a much bigger story coming out about these specific coins crashing. It's an unregulated market and a couple of HFT funds are going to war in them right now.

[Hards Alumni]

Only adjacent to your question because I was in on COIN early, but don't actually trade crypto itself.  But I'm trying to time the bottom and double down here pretty shortly.  To Hards' point, this is just the volatility of crypto, so for me the real bet is "is crypto here to stay?"  I think the answer is yes, even though I think it will only play a secondary/cyclical role to other currencies and investments.  But even that, combined with what I think is Coinbase's still relatively strong position compared to other exchanges, is good enough for me to get in at this low.

I really want to buy some more COIN this low.  This level is absurd, honestly.  Do I have the nards to pull the trigger.  Ugh.  Ask me in an hour.

[Hards Alumni]

Can you share?

https://www.coindesk.com/business/2022/05/09/ust-stablecoin-falls-below-dollar-peg-for-second-time-in-48-hours/

It's a few days old already, but relevant.  Much more has happened to LUNA since.

coindesk is a pretty decent place for crypto info.  Most of the major media outlets are interested in their clicks and have been cheerleaders against crypto from the outset.