+BRICS internal currency : Breaking news: brics launch gold-backed unit
It’s personal but I don’t put faith in the US government and wouldn’t touch treasuries with a 10 foot pole. I would personally not keep more USD than is required for my liquidity needs.
If you do hold USD, SGOV is as secure and, at least currently, yielding somewhat more than USD cash on IBKR. As mentioned by @nabalzbhf, BOXX or another money market fund could also be an option.
So, I’ve always been unsure whether your avatar pic is actually a selfie, a bear pic, or some different animal altogether.
What I would be even more interested in is what other currencies or values you believe in if you doubt the US government, the USD, or treasuries.
Do you believe any of them – including gold – are sufficiently independent of the US reality distortion terraforming field? Why do you think so?
To be clear: I am in no way endorsing the way the US behaves, officially, but I am also in almost no doubt that nobody is going to challenge them, at least in the next couple of years, maybe longer.
Feel free to not answer, of course.
@Wolverine will fight for himself, I’m sure. @Your_Full_Name might end up seeing himself out. Again! We know the storyline now. Why not shuffle the avatars and names and find out who is who?
Anyways, let me start with this pic of gov debt vs. relative budget deficit. It shows discipline and socialism. There is a corner with CHF and there is a place far away with USD.
Of course there is another view of CHF
No need for @Wolverine to “fight” for himself. I explicitly said that they should feel free to ignore my questions, IIRC.
Otherwise, I’ll see myself out anyday you want. Or, alternatively, you can just ignore my posts? I know, it’s a hard ask, but maybe just give it a try.
I feel I didn’t entirely get your point except that it might be a bad idea to hold currencies over months or years or decades versus holding assets (in whatever currencies).
Sorry if I misunderstood.
Assuming US bond means we need to trust word of US govt to get money back, I think we should question how much we can count on the “word”
The ink is not even dry on some of the one sided trade deals and now comes another statement. Whatever happed to US-EU trade deal 
If other governments (and their bonds) can be trusted more is up for debate. Maybe Switzerland.
Since you’re still referring to US bonds … how did the global (US) bond market react to these news?
I think even they (whoever is buying US bonds) don’t trust anything anymore what is said in these statements. Bond market is more or less flat.
An interesting data point is Japan. They have so much more debt/GDP than the USA. Now of course you can argue over many nuances but perhaps the US could still double its indebtedness without too much grumbling from Mr Market?
Maybe that’s something to do with who owns the debt . As far as I know in Japan a large chunk is owned by BOJ
But indeed a lot of countries have debt issues. France is also not very good.
Why, that, sir, is a noble specimen of the strong and ferocious wolverines. Nothing to do with those oafish bears. Wolverines are mustelidae, more akin to weasels and martens. It might also be a selfie, I’ll let you choose what you want to believe in that regard.
Disclaimer: this isn’t based on long financial research and a significant bit of personal perception and vibes go into my investing stance. Also, I don’t have enough assets that currency diversification might play a role in my investing strategy. I have, however, considered where I want to go as my assets grow.
My basic stance is that currencies are liquidities and not stores of wealth. As for bonds, I would consider them as part of a risk parity strategy, with the aim of taking leverage on a diversified portfolio of assets to fine tune my risk and expected returns targets.
My current target strategy is:
60% Developped ex-US stocks
20% “long term” swiss goverment bonds
20% gold
With x1.45 target leverage, increasing during drawdowns and potential adjustments depending on interest rates/cost of leverage vs expected returns.
With a side of stock picking with a focus on value investing.
More research will have to go into that and it may evolve with time.
As for bonds, I would consider:
a diversified basket of corporate bonds, that can include bonds denominated in USD (and other currencies) if properly diversified and not an overtly too big part of the portfolio, so not market weighted. For bonds, I believe good active management does bring value. I haven’t found a fund I would want to invest in if going that way.
swiss bonds (government, government-like, mix of government + corporates). Though if interest rates go negative again, a ladder of medium term notes or cash on a bank account might be a better option, depending on what strategy I am trying to implement.
a selection of other government bonds for which I would have to do research. As a pure vibe play, I could see myself buying Canadian, some european (Germany, probably nordic countries, potentially others) or Australian bonds. Recent evolutions make me reconsider if there aren’t some assets worth considering in emerging markets too.
I believe we can’t reach perfection. Interdependencies exist and the USD and the health of the US economy affect most everything worldwide.
I also think that in case of US driven sudden shock, US bonds will be more affected than other assets dependent on them, even if we see bankruptcies occur for companies/banks (not only US ones, listed companies as a whole tend to have too much exposure to the US market and US Treasuries for my taste).
My main conviction is that the US will loose their hegemony in a gradual fashion, with less economic and military power over time as they withdraw from the world order and other countries have to step up for themselves. In that scenario, we may avoid a big crash and other assets may hold their value over time, albeit with some potential volatility.
I believe that people (among which investors) are still psychologically driven to attribute value to gold so I expect it to be very volatile but potentially act differently than major currencies when/if trouble occurs for them. I don’t think Bitcoin has reached that status yet.
Mainly, I want my investments to have as little to do as possible with both the US and China (and Russia) as I believe world superpowers aren’t beholden to small investors like myself and can even defy large companies like Blackrock and Vanguard. I like smaller actors with a reliable regulatory framework as they are, in my opinion, more likely to be beholden to the will of the markets.
This part is mind-blowing and makes you wonder:
| 1804-1900 | 1900-2023 | |
|---|---|---|
| Inflation per year: | 0.07% | 2.08% |
| Purchasing power: | -6.81% | -92.48% |
I am actually facing a dilemma because I want to try to invest in “alternatives to Equity” because I think I have enough equity for now. But almost everything else is either overhyped OR not much better than cash.
For Swiss investors, is CASH the only reasonable diversifier these days ?
Swiss RE funds -: very high AGIO. GOLD -: already feels like speculation at max level, Swiss Govt Bonds - post tax yields are negative or close to zero
BTC took a hit from ATH recently.
FWIW, I don’t know what the consensus among investors is, but for me I mostly care about the yield.
Given how rents work, the absolute dividend should stay stable so it should be similar to a long term bond (with different risk profile + exposure to RE fluctuations).
CHF corporate bonds should still have positive post-tax yields, although the yields are also low, of course. There is more correlation to stocks than with gov bonds but they still offer diversification. Current yield-to-maturity of SBI Corporate is 1.03% with a duration of 4.5.
If that’s too correlated for you, SBI AAA-BBB has a yield-to-maturity of 0.76% with a duration of 7.2. SBI AAA-AA has a yield-to-maturity of 0.71% with a duration of 8.0. With these, the yield after fees and taxes gets close to zero, so the bigger (positive or negative) effect might be their sensitivity to changes in market interest rates.
yeah i checked those… i feel they have more downside risk than upside potential because interest rates are already ZERO.
True, the yield is the main thing… but when i look at some of the Agio of 65-70%, I think these assets need to be held for 20 years min to go through a price correction in downturn
the main reason is that I don’t think i will feel good in a 50% equity crash. Thus 100% equity portfolio is not for me. And I am also 100% sure, I will go through such a crash in my investment horizon.
I try to be about 65% Equity, Rest is RE funds, Cash, Bonds (within 3a etc) and a bit of Gold.
The market will be brutal on monday… thanks to Donald
Or not? remember about TACO?
