Sunday, July 31, 2016

comments on smol Equities and Bonds can't be both right. Right?

long duration fixed income investors moving to short term to lower their risk in recent times. you can't change the spots on leopards, fixed income investors will always prefer fixed income. and then there's the positioning by funds too. when even the old and new bond kings go bearish on longer duration bonds, you know there is just one last attempt to hit the highs.
if you are confused by the above paragraph, I have posted some hastily written articles. or you can just google for the info.
some nice stuff there smol.
"With 30 year bonds yielding so low, in the days of old, short term treasuries will be yielding much higher to give an inverted yield curve."

abe and kuroda playing pingpong. neither wants to be responsible.
seriously, time is running out for these deflationary markets.
time to bring on the fiscal spending bazooka.
else it's not just changes in the monetary policy environments,
it's the change in public political sentiments!
"Let's see whether Japan got the guts to be the first country to experiment with "helicopter money" this week."

half the bonds out there in the DM world are negative yielding.
"11 trillions of sovereign bonds globally are now in negative yield. Who owns these bonds? "

nice. correlations work.... until they don't. a nice example is the recent decoupling between oil and us equities.
"Corelation between asset classes change all the time. During GFC, asset classes that have low co-relation become highly co-related. I think not all bonds are created equal."

devaluation of renminbi. right now, it's businesses and asset plays, not just properties.
"You think why rich mainland Chinese are bidding up properties in Canada, Australia, HK, and Singapore?"

how soon? no idea. is there coordination between CBs? no idea.
"Now, when the music stop and central bank start to drain the water back, which glasses will be emptied first and which glass will not be completely emptied?"

haha. a standard idea sold to people who don't know what to do.
"All these years, I've been told to hold both bonds and equities to take advantage when either asset class drops."

nope. SGD is extremely teng (tough to chew) at the moment still. but other currencies are dropping.
"But what am I suppose to do now when both are rising? Both are rising due to increase liquidity cause by QE right? Does this mean that the value of my cash holdings will fall due to inflation?"

is that a leading question? lol
" In that case, am I suppose to buy some precious metal to protect the value?"

what do you think of that, TI?
" Or will it be better to get some ETF to ride on the liquidity wave? Wouldn't this QE bubble burst anytime? It's doesn't make sense to keep printing when it's not back by any assets except our confidence in the paper right?"

that's your reaction? so funny lol and no, i am not making fun of you.
"Why are there so much considerations? Not passive at all leh! 我被骗了"

i imagine it is tough. the risk is so high.
"I tell you, it cannot be fun to be money managers working for pension funds or insurance companies right now.How to secure the "promised" income for your pensioners and policy holders when 10 year US treasury is yielding below 2%???"

somemore still got people recommending crowd funding leh. I see the 13.5% yield on Epicentre for $1m and I go huh? why the management of Epicentre do this? do they need it? what's their vested stake? somemore got so many promoters woh. what are they earning?
"3) Small time newbie "ah longs" losing their money in peer-to-peer lending..."

they go by tranches. the ones where yields are guaranteed means they already bought them. and if the prices go up, they sell to lock in the promised yields and get some float. It's really the mark to market ones that are scary.
by my reckoning, some 'accredited investors' are going to get some real accreditations.
"If it's institutions then quite cham, can't worm their way out of the "promised guaranteed plus chop capital protected with variable bonus interest else my banking hall let you burn" investment that they have sold to their clients, without fearing that these investments will go up in smoke IF the party ends (honestly I think few really knows which direction the market will trend now right?)."

so long ago. such a dangerous time then.
"In the past, where need to invest. Just save put in the bank double digit interest compound. Where got all the rubbish of 5-6% return portfolio per year that we are all shouting now from our portfolio. "

they charge, bank run, lower reserve, unlawful. so they also forced to find yield. else unprofitable, bank selloff. see european banks. it's fun so far.
"Then now negative interest which is the central bank preventing commercial bank to hold money but instead lend it all out. Bank will never charge consumer negative interest. "

I always maintained bonds have the same risk as stocks.
risk is defined as permanent loss of capital.
the volatility is different, that's all.
"" Don’t forget that bond prices crashed in late 2008, and many stopped paying dividends."

lol are you positioned?
"In investing, its all about positioning - before the event happens."

don't like that. lol
they doing their best already.
I don't know about their market knowledge of all these current batch.
(LHL and tharman are really smart people though.)
but they did put in their heart. even upped the CPF RA rates via a tiered system.
I just hope they are not eating into reserves again. (I am a miser.)
and not squeezing juice out of the GIC rock.
forcing people an impossible target sometimes result in disasterous consequences.
"Those of us who worked in corporate and experienced a top management change would appreciate.Promises made by the previous management to you become words written on water :("

"Just look at ASEAN - how many are run by the military in the background? So far so good? That's because we have a BIG STICK!"

gan en
"If I look at Taiwan and HK for the past 10 years; and Japan for the past 30 years... I am just grateful how life has turned out for me and my family."