Search found 224 matches

by Eric76
Tue Jan 23, 2024 3:32 am
Forum: Personal Finance (Not Investing)
Topic: [2023 Treasury Direct 1099-INT now available, how to print]
Replies: 58
Views: 6956

Re: Printing a Treasury Direct 1099-int (for I Bonds)

Does TD mail the 1099s or do you have to download it?
by Eric76
Sat Jan 20, 2024 5:28 pm
Forum: Investing - Theory, News & General
Topic: The Final, Definitive Thread on Brokerage Transfer Bonuses
Replies: 7737
Views: 1337965

Re: The Final, Definitive Thread on Brokerage Transfer Bonuses

Re: HSBC bonus offer The Disclaimers reads (https://www.us.hsbc.com/checking-accounts/promotions/premier-offer/#how-it-works): Terms to Qualify for Cash Bonus: New Customer must meet each of the following requirements to qualify for the Cash Bonus: Open a new HSBC Premier1 checking account (“New Account”) during the Offer Period; AND Meet a Qualifying Balance of $100,000 or more of New Money in deposit and/or eligible investment accounts within 20 calendar days of opening the New Account; AND Maintain the required Qualifying Balance for 3 full consecutive calendar months following the New Account opening month. For purposes of determining whether the New Customer has maintained the required Qualifying Balance and the associated Cash Bonus ...
by Eric76
Sat Jan 20, 2024 4:35 am
Forum: Personal Consumer Issues
Topic: Are car washes necessary?
Replies: 116
Views: 12619

Re: Are car washes necessary?

machineboy wrote: Sat Jan 20, 2024 12:02 am Our local car wash allows us to be members for $30 a month. This gets you unlimited trips through the car wash. This includes rinsing the under carriage. For another $15 a month we can add a second car. So, for $22.50 a month per car both my wife and I can have clean cars. If a bird poops on the car, go through the car wash. If it snows, go through the car wash. Back window dirty? Car wash…
$540/year on car washes. Nope!
by Eric76
Sat Jan 20, 2024 4:31 am
Forum: Personal Consumer Issues
Topic: Are car washes necessary?
Replies: 116
Views: 12619

Re: Are car washes necessary?

:moneybag
runswithscissors wrote: Fri Jan 19, 2024 4:02 am All the gunk and dirt and debris acts as an additional barrier on your paint to keep your vehicle's metal panels from degrading. Why would anyone want to remove this barrier?
Have no idea if this is true, but it's exactly what my dad says!

Meanwhile, I get unlimited free car washes from God (or whatever makes it rain).
by Eric76
Tue Jan 09, 2024 10:03 pm
Forum: Personal Investments
Topic: Adios, Vanguard
Replies: 465
Views: 93462

Re: Adios, Vanguard

When every other brokerage will pay you for your assets, I don't see a compelling reason to stay at VG...and that's exactly what VG wants.
by Eric76
Mon Jan 08, 2024 4:40 am
Forum: Personal Finance (Not Investing)
Topic: How are we doing? Mid-age net worth
Replies: 37
Views: 7740

Re: How are we doing? Mid-age net worth

the_wiki wrote: Sat Jan 06, 2024 10:28 pm How are you doing with a 7 figure net worth and $400k salary? Better than just about anyone else on the planet.
This. But rich people have angst too....
by Eric76
Thu Jan 04, 2024 5:05 pm
Forum: Personal Consumer Issues
Topic: Does anyone use the Drive Safe & Save app from State Farm or similar?
Replies: 81
Views: 17764

Re: Does anyone use the Drive Safe & Save app from State Farm or similar?

It's amazing how many of you trust the insurance companies to record your driving data properly and give you the correct discount while protecting your data. If a kid runs in front of my car and I slam on my brake to not hit him, I get a demerit from SF for hard braking? Would it help my rate if I didn't brake? Add in the privacy intrusion and added work of turning the thing on and off and recording milage. I'll pass.
by Eric76
Tue Jan 24, 2023 10:00 pm
Forum: US Chapters
Topic: 🎊Happy 99th Birthday to Taylor Larimore🎉
Replies: 247
Views: 15717

Re: 🎊Happy 99th Birthday to Taylor Larimore🎉

Happy Birthday Taylor. Next year's will be even cooler!
by Eric76
Tue Nov 01, 2022 9:13 am
Forum: Investing - Theory, News & General
Topic: I Bonds Mega Thread (I Bond Heads Rejoice!)
Replies: 6651
Views: 1204063

Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Cheez-It Guy wrote: Tue Nov 01, 2022 9:10 am Nice! I noticed that as well. Total rate of 6.89% -- higher than expected. Will look forward to a late January purchase.
Includes .4% fixed rate I believe.
by Eric76
Thu Oct 20, 2022 4:12 am
Forum: Personal Investments
Topic: Downpayment held in bonds down 13%. What do?
Replies: 40
Views: 5523

Re: Downpayment held in bonds down 13%. What do?

OP's experience is another example of how the Fed is successfully braking (breaking?) the housing market through interest rate policy. This is the first big tightening cycle I have lived through (too young to remember Volker) and it is really interesting to experience.
by Eric76
Sun Oct 16, 2022 5:36 am
Forum: Personal Consumer Issues
Topic: Used car price trends
Replies: 12
Views: 2446

Re: Used car price trends

New car inventories are meaningfully increasing (although not close to pre pandemic levels...may never get to that point). Used car inventories are increasing. Prices on used cars have been dropping at rates exceeding historical averages for over 3 months. Repossessions are also increasing.

At the same time affordability is getting worse because over 80% of car buyers finance.

I think cash buyers are in a very good position to get a decent deal. It's looking like that position is improving every day.
by Eric76
Mon Oct 10, 2022 5:08 am
Forum: Personal Consumer Issues
Topic: 8 months wait for a new car!
Replies: 53
Views: 7302

Re: 8 months wait for a new car!

Double posted.
by Eric76
Mon Oct 10, 2022 5:08 am
Forum: Personal Consumer Issues
Topic: 8 months wait for a new car!
Replies: 53
Views: 7302

Re: 8 months wait for a new car!

There is a 0% chance I will go on a wait list for a car and/or pay over msrp. Ever. Fix the old car or buy a used one. Used car prices are fortunately finally starting to come down a bit due to a combo of increasing inventory and rising interest rates.
by Eric76
Sun Oct 02, 2022 9:06 pm
Forum: Personal Investments
Topic: Vanguard Target Retirement 2020 Down [almost 20%]
Replies: 14
Views: 2294

Re: Vanguard Target Retirement 2020 Down 30%

I see -18.21% YTD and -16.44% 1 year. Still awful, but not -30%.
by Eric76
Thu Sep 29, 2022 5:36 am
Forum: Investing - Theory, News & General
Topic: I Bonds Mega Thread (I Bond Heads Rejoice!)
Replies: 6651
Views: 1204063

Re: Will base rate of i-bonds change next period?

justsomeguy2018 wrote: Wed Sep 28, 2022 3:44 pm [Thread merged into here --admin LadyGeek]

I believe the current base is 0% and inflation rate makes total interest rate equal to 9.62%.

Will next 6 month period have a higher base rate now that the Fed has raised rates?

What determines the base rate?

Also any predictions on if the total rate will be higher or lower than 9.62% once the new period starts?
How the fixed rate on I bonds is calculated is one of the world's great mysteries.
by Eric76
Tue Sep 27, 2022 10:16 am
Forum: Investing - Theory, News & General
Topic: I Bonds Mega Thread (I Bond Heads Rejoice!)
Replies: 6651
Views: 1204063

Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Anyone have insights into predicting the fixed rate for November? A few years ago I saw a pretty good prediction model using the 5 & 10 year TIPs. I wish I still had the link to the site. If my memory is correct and the treasury is still honest, I'm guessing it should be around 1.2-1.6%. Ken Tumin addresses this question: Fed Meeting: Third Straight 75-bp Rate Hike - Strategies for Savers WEDNESDAY, SEPTEMBER 21, 2022 BY Ken Tumin https://www.depositaccounts.com/blog/federal-funds-rate-hike/ <<High inflation from September 2021 through March 2022 has resulted in a record-high I Bond inflation rate of 9.62%. Unfortunately, the I Bond fixed rate remains at 0%, so the composite rate equals the inflation rate. I Bonds that are purchased th...
by Eric76
Thu Sep 15, 2022 6:22 am
Forum: Investing - Theory, News & General
Topic: I Bonds Mega Thread (I Bond Heads Rejoice!)
Replies: 6651
Views: 1204063

Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Do the bogleheads have a consensus estimate on what November's variable rate will be? I've seen wide ranging estimates from 6% to 12%.
by Eric76
Tue Sep 13, 2022 8:59 am
Forum: Investing - Theory, News & General
Topic: I Bonds Mega Thread (I Bond Heads Rejoice!)
Replies: 6651
Views: 1204063

Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

BrokerageZelda wrote: Tue Sep 13, 2022 8:55 am
Eric76 wrote: Tue Sep 13, 2022 8:48 am Probably a dumb rookie question, but I purchased $20,000 in iBonds in April, 2022. The bonds are showing zero accrued interest as of today. Does that make sense?
You may have to click through to the detail page to see the actual redemption value (minus penalty). The overview pages show an "Amount" that represents the face value/purchase price only. If you purchased the bonds in April 2022, there should be some post-penalty interest showing.
Ah, ok I see it now. Thank you.
by Eric76
Tue Sep 13, 2022 8:48 am
Forum: Investing - Theory, News & General
Topic: I Bonds Mega Thread (I Bond Heads Rejoice!)
Replies: 6651
Views: 1204063

Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Probably a dumb rookie question, but I purchased $20,000 in iBonds in April, 2022. The bonds are showing zero accrued interest as of today. Does that make sense?
by Eric76
Fri Jun 03, 2022 11:19 am
Forum: Personal Finance (Not Investing)
Topic: Zelle fraud
Replies: 62
Views: 8341

Re: Zelle fraud

I love Zelle. Use it all the time.
by Eric76
Sat Apr 30, 2022 4:31 am
Forum: Personal Investments
Topic: Difficulty getting into Treasury Direct
Replies: 4
Views: 1058

Re: Difficulty getting into Treasury Direct

When establishing my wife's TD account, I made an error entering the routing number on her bank account. To correct the error she now needs to physically go to her bank, get a medallion signature guarantee on the account number change form, and snail mail it to TD. Thus I had to gift her the Ibonds in order to get the transaction done in April. To say TD is not user friendly is an understatement.
by Eric76
Tue Oct 05, 2021 8:30 am
Forum: Personal Investments
Topic: [Friend bought VTI - What should he do?]
Replies: 79
Views: 6146

Re: [Friend bought VTI - What should he do?]

The correct answer is to tell your friend to leave it alone. It's as if OP asked for directions to a water fountain, and a lot of the replies were about how to start a water bottling operation.
by Eric76
Sat Jul 17, 2021 3:34 am
Forum: Personal Finance (Not Investing)
Topic: Is title insurance needed for new construction townhome in NJ purchased for cash (no mortgage)
Replies: 74
Views: 6933

Re: Is title insurance needed for new construction townhome in NJ purchased for cash (no mortgage)

Luckywon wrote: Fri Jul 16, 2021 8:09 pm In my opinion, title insurance is basically a racketeering scheme where most of the money is siphoned off in the form of kickbacks. I would never buy it if not required and certainly not in this case. Obviously, many disagree. Just my opinion.
That is my understanding as well. Has anyone here ever made a title insurance claim, or even know someone who has?
by Eric76
Sun May 30, 2021 11:29 pm
Forum: Personal Finance (Not Investing)
Topic: LenderFi: Who did they sell your mortgage to?
Replies: 62
Views: 8117

Re: LenderFi: Who did they sell your mortgage to?

Wells. Haven't been Hangin' with Mr. Cooper.
by Eric76
Mon Apr 12, 2021 5:07 am
Forum: Investing - Theory, News & General
Topic: Is this the single worst time to be a passive investor
Replies: 73
Views: 11091

Re: Is this the single worst time to be a passive investor

Isn't 50% of active money going to always outperform and underperform the market (before taxes and expenses are factored in) regardless of market conditions?
by Eric76
Sat Mar 06, 2021 3:29 pm
Forum: Investing - Theory, News & General
Topic: Why the disdain for managed funds like ARKK that destroy total market funds?
Replies: 1587
Views: 210447

Re: Why the disdain for managed funds like ARKK that destroy total market funds?

Carol88888 wrote: Sat Mar 06, 2021 2:54 pm I would just caution people from hanging onto every word of Cathie Wood.

Has any fund manager ever said, "There could be better places for your money" ?
Wood's explicit religiosity makes the religious like fervor of her investors more alarming to me. The Wood phenomenon reminds me of the late 90s .com mutual fund era..on steroids. I'll pass on the money manager worship and enjoy TSLA gains through my VTI,. I'll also sleep well knowing I'm very diversified if it crashes back to Earth like a space x rocket!
by Eric76
Fri Mar 05, 2021 1:56 pm
Forum: Personal Finance (Not Investing)
Topic: How to prove PPP Loan used for payroll? Sole Proprietor
Replies: 29
Views: 3152

Re: How to prove PPP Loan used for payroll? Sole Proprietor

I'm an IC. My first draw PPP was deposited in a money market account at the bank that did the loan. The same sum is still sitting in that money market account, and I had no issue filing for 100% forgiveness and getting forgiveness. So to answer the OP's question, you don't need to do anything.
by Eric76
Thu Mar 04, 2021 9:49 am
Forum: Personal Consumer Issues
Topic: You get what you pay for!
Replies: 48
Views: 5005

Re: You get what you pay for!

https://discover.gia.edu/id100 Interesting and new to me. Are you familiar with it? After doing a lot of googling, it seems like a fairly old technology and is used to differentiate between synthetic diamonds made from other things besides carbon and real 100% carbon diamonds. Since the lab grown diamonds in the linked article and television news report use a recently developed process and are also 100% carbon and atomically the same as a mined diamond, I would guess this doesn't work on them. The id100 works on thermal conductivity and physics says that if they are made from the same materials, they should conduct thermally the same. But I haven't found anything online to confirm that. I did turn up lots of articles showing the id100 does...
by Eric76
Thu Mar 04, 2021 7:11 am
Forum: Personal Consumer Issues
Topic: You get what you pay for!
Replies: 48
Views: 5005

Re: You get what you pay for!

The OP should have held out. The future of diamonds are that they will be grown in a lab instead of mined. There are companies already doing so and they are identical to the mined ones in all four c's mentioned above with the exception of the cost. Trained gemologists are unable to distinguish between them. Lab grown ones are currently $300 to $500 per carat, compared to the $4000+ per carat mined diamonds are selling for. Had this been around when I bought my wife's engagement ring, I would have gone for another carat instead of her fraction of one she has now. I've been thinking it might be time for an upgraded ring for a future anniversary. https://www.bbc.com/future/article/20200207-the-sparkling-rise-of-the-lab-grown-diamond So, is up...
by Eric76
Wed Mar 03, 2021 11:26 am
Forum: Personal Consumer Issues
Topic: You get what you pay for!
Replies: 48
Views: 5005

Re: You get what you pay for!

The OP should have held out. The future of diamonds are that they will be grown in a lab instead of mined. There are companies already doing so and they are identical to the mined ones in all four c's mentioned above with the exception of the cost. Trained gemologists are unable to distinguish between them. Lab grown ones are currently $300 to $500 per carat, compared to the $4000+ per carat mined diamonds are selling for. Had this been around when I bought my wife's engagement ring, I would have gone for another carat instead of her fraction of one she has now. I've been thinking it might be time for an upgraded ring for a future anniversary. https://www.bbc.com/future/article/20200207-the-sparkling-rise-of-the-lab-grown-diamond Da Beers ...
by Eric76
Thu Feb 18, 2021 10:51 pm
Forum: Investing - Theory, News & General
Topic: How to Invest in Crypto like a Boglehead?
Replies: 232
Views: 42310

Re: How to Invest in Crypto like a Boglehead?

Tingting1013 wrote: Thu Feb 18, 2021 7:50 am
Eric76 wrote: Thu Feb 18, 2021 3:17 am The way to invest in crypto like a boglehead is to continue to "don't do something, just sit there." When and if crypto becomes truly viable, publicly traded companies that I already own through VTI will be figuring out ways to invest in and profit from it. Some already are.

Indexing wins again.
And what if government regulations ban publicly traded companies from holding crypto?

How exactly would indexing “win” then?
That would be a really good reason to not own any crypto directly.
by Eric76
Thu Feb 18, 2021 7:07 am
Forum: Investing - Theory, News & General
Topic: “New Bitcoin Investors Explain Why They’re Buying at Record Prices“
Replies: 936
Views: 79747

Re: “New Bitcoin Investors Explain Why They’re Buying at Record Prices“

Because nothing you said is guaranteed. You cannot say bitcoin is a sure thing over a 4 year time horizon. I think we may just have different investing philosophies then. I don't need a 100% certainty of return in order to justify allocating a small fraction of my portfolio to an asset. Don't use a word like "unbeatable" then with no qualifications (along with a strangely specific time-line - what's special about 4 years instead 3 or 5?) OK sure, maybe I should have said " has been unbeatable." To my knowledge there is no asset that has a higher average annual return across it's life than bitcoin. Of course nobody can predict the future. Given the above it's bewildering to see people consciously have zero exposure (even...
by Eric76
Thu Feb 18, 2021 3:17 am
Forum: Investing - Theory, News & General
Topic: How to Invest in Crypto like a Boglehead?
Replies: 232
Views: 42310

Re: How to Invest in Crypto like a Boglehead?

The way to invest in crypto like a boglehead is to continue to "don't do something, just sit there." When and if crypto becomes truly viable, publicly traded companies that I already own through VTI will be figuring out ways to invest in and profit from it. Some already are.

Indexing wins again.
by Eric76
Mon Dec 28, 2020 4:21 pm
Forum: Personal Finance (Not Investing)
Topic: PPP Second Draw
Replies: 9
Views: 1164

Re: PPP Second Draw

simplesimon wrote: Mon Dec 28, 2020 2:26 pm Any guesses as to how long before funding runs out?
I don't think they came close to running out of funding for the 2nd round, and they tightened up the requirements this round, so I doubt it runs out right away. But who knows?
by Eric76
Sun Sep 27, 2020 6:11 pm
Forum: Investing - Theory, News & General
Topic: Are we NOW in a bubble?
Replies: 103
Views: 13511

Re: Are we NOW in a bubble?

Maybe. Maybe not.
by Eric76
Wed Aug 05, 2020 9:52 pm
Forum: Personal Finance (Not Investing)
Topic: My LenderFi refinance is going well
Replies: 1849
Views: 214031

Re: My LenderFi refinance is going well

I posted this in the mega thread as well, but has anybody had luck renegotiating on credits/rate with Lender Fi after a lock? My loan went to processing today.
by Eric76
Wed Aug 05, 2020 9:44 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265800

Re: Refinance Mega Thread

I locked with LenderFi a couple of weeks ago at 2.75% with a $2200 lender credit. Looking at about $1600 in closing costs (not including pre-paids and escrow). This is apparently a pretty mediocre deal right now. Can I renegotiate with them on an already locked rate, or do I need to let the lock expire and start over? I was advised my loan just went to processing today. I locked with them a while back at 2.875% no cost closing. I'm closing this friday and plan to go through with it. I'm taking what I can get and deal with a lower rate down the road. This is my second refinance this year. I went from 4.25% --> 3.5% -->2.875% Eric, It never hurts to ask. The worst they can say is no. You can cancel your refinance today and you have three day...
by Eric76
Tue Aug 04, 2020 10:43 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265800

Re: Refinance Mega Thread

I locked with LenderFi a couple of weeks ago at 2.75% with a $2200 lender credit. Looking at about $1600 in closing costs (not including pre-paids and escrow). This is apparently a pretty mediocre deal right now. Can I renegotiate with them on an already locked rate, or do I need to let the lock expire and start over? I was advised my loan just went to processing today.
by Eric76
Mon Aug 03, 2020 2:14 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265800

Re: Refinance Mega Thread

Berean wrote: Mon Aug 03, 2020 1:32 pm
camillus wrote: Mon Aug 03, 2020 1:15 pm
anon_investor wrote: Mon Aug 03, 2020 1:04 pmFYI if you have to roll any closing costs (aside from prepaids/escrow) then it is not a "no cost refi".
Thank you.
It seems to me that a true "no cost" loan is when the costs listed on a Loan Estimate in sections D and E (and maybe H, though I have not seen one) minus any lender credits equals zero. Right?
When posters refer to "no cost" they mean no costs other than prepaid interest and escrow.
by Eric76
Wed Jul 29, 2020 3:41 am
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265800

Re: Refinance Mega Thread

Just locked my refi through lenderfi at 2.75 by using the backdoor method that someone here linked to. This thread is incredible! Thanks to all who contribute.
by Eric76
Tue Mar 31, 2020 8:14 am
Forum: Personal Finance (Not Investing)
Topic: Stimulus payment through EFTPS?
Replies: 0
Views: 207

Stimulus payment through EFTPS?

I don't efile my taxes but I do use EFTPS to make quarterly payments. Does anybody know if I will receive the stimulus payment to my account linked with EFTPS, or will I need to wait for a paper check because I don't efile?
by Eric76
Fri Mar 06, 2020 10:46 am
Forum: Personal Finance (Not Investing)
Topic: 30 year mortgage under 3%
Replies: 301
Views: 54037

Re: 30 year mortgage under 3%

Although the 10 year has moved down ~40 bps since the rates hit 3.125% (30 year, 70% max LTV 0 origination pts, 800+ credit) at the local bank I was looking to refinance at, my quoted mortgage rate has not moved down at all. Normally, a 40 bps drop translates into 2+ origination pts or a rate drop of roughly 3/8%. I called two other banks and they said the rates aren't going lower despite the free falling yields. So even if the 10 year goes to zero or negative, it seems the floor at least in my area is 3%. I was about to post the same thing. It’s really aggravating that even though the 10-year T is hovering at 0.75% (as of this writing), the floor is still at 20-year @ 3.25 zero-cost for my situation and hasn’t budged all week. I’m sure if...
by Eric76
Fri Mar 06, 2020 5:20 am
Forum: Personal Finance (Not Investing)
Topic: 30 year mortgage under 3%
Replies: 301
Views: 54037

Re: 30 year mortgage under 3%

manatee2005 wrote: Thu Mar 05, 2020 11:52 pm
Eric76 wrote: Thu Mar 05, 2020 10:01 pm I'm in Florida and the rates on lenderfi have somehow been going up in the past week even as the 10 year plummeted. Last week I could get 3.25 30 year with no closing costs, and now I would have some closing costs at 3.375. Makes no sense to me.
Let me make sense of it for you. They are getting swamped with calls and can't handle the volume. So they are increasing the price to slow down the demand.
That's logical.
by Eric76
Thu Mar 05, 2020 10:01 pm
Forum: Personal Finance (Not Investing)
Topic: 30 year mortgage under 3%
Replies: 301
Views: 54037

Re: 30 year mortgage under 3%

I'm in Florida and the rates on lenderfi have somehow been going up in the past week even as the 10 year plummeted. Last week I could get 3.25 30 year with no closing costs, and now I would have some closing costs at 3.375. Makes no sense to me.
by Eric76
Thu Feb 27, 2020 6:17 pm
Forum: Personal Finance (Not Investing)
Topic: My LenderFi refinance is going well
Replies: 1849
Views: 214031

Re: My LenderFi refinance is going well

Does anybody know of lenders other than LenderFi and AimLoans that don't require personal information to give quotes and closing costs?
by Eric76
Sun Jan 26, 2020 9:09 pm
Forum: US Chapters
Topic: Happy Birthday Taylor! 96 years young!
Replies: 139
Views: 8362

Re: Happy Birthday Taylor! 96 years young!

Happy Birthday Taylor! What is the secret to your longevity?
by Eric76
Sun Jan 26, 2020 10:45 am
Forum: Personal Finance (Not Investing)
Topic: What did you do cool with your money today?
Replies: 125
Views: 12228

Re: What did you do cool with your money today?

Paid for my parents' 50th anniversary party.
by Eric76
Fri Jan 17, 2020 4:47 am
Forum: Investing - Theory, News & General
Topic: How is Berkshire Hathaway stock NOT a better investment than the index?
Replies: 136
Views: 29349

Re: How is Berkshire Hathaway stock NOT a better investment than the index?

I have some Berkshire. It's my only individual stock. To me the point of it is not that it will beat the S&P 500 during bull markets like the 2010s, because it won't. The point is that Berkshire has the amazing operating companies and is hoarding a ton of cash, well-positioned for the next recession, whenever that finally comes. The big risk imo is the capital allocation after Buffett's passing. I think there's nothing wrong with allocating a certain portion, a small percentage, of your portfolio to Berkshire. There's no other stock I'd say that about. I wouldn't want to own Brk specifically because of the cash drag. There is no cash drag Berkshire matches its cash and fixed income portfolio size to its insurance float (insurance liabi...
by Eric76
Fri Jan 17, 2020 4:43 am
Forum: Investing - Theory, News & General
Topic: How is Berkshire Hathaway stock NOT a better investment than the index?
Replies: 136
Views: 29349

Re: How is Berkshire Hathaway stock NOT a better investment than the index?

They are sitting on $128 billion in cash that is therefore not invested. That's a cash drag. I don't pretend to understand the specifics of the insurance business to know if that cash has a business purpose for sitting there. But even if it does, I want the equity portion of my portfolio fully invested, and not invested in a company that has 20% of its market cap in cash. You do realize that the top companies in the Total Stock Market index, like Apple and Microsoft, are also sitting on giant amounts of cash, right? Apple has $245B in cash, Microsoft has $139B in cash, both more than Berkshire. So Apple has ~25% of its market cap in cash. At least Apple and Microsoft are spitting some of that cash back to investors with dividends. But, yes...