Search found 1217 matches

by Oicuryy
Fri Jul 20, 2018 9:12 pm
Forum: Investing - Theory, News & General
Topic: How does the Fed purchase bonds
Replies: 4
Views: 131

Re: How does the Fed purchase bonds

This write-up from the New York Fed is a little dated. But the mechanics of their bond trading haven't changed much.

Open Market Operations

Ron
by Oicuryy
Sat Jul 14, 2018 9:48 pm
Forum: Investing - Theory, News & General
Topic: [Backdoor Roth IRA - Forbes: IRS Unlocks The 'Door' For High-Income Savers]
Replies: 7
Views: 1460

Re: [Backdoor Roth IRA - Forbes: IRS Unlocks The 'Door' For High-Income Savers]

Footnote 269 on page 289 of Conference Report To Accompany H.R. 1 says: Although an individual with AGI exceeding certain limits is not permitted to make a contribution directly to a Roth IRA, the individual can make a contribution to a traditional IRA and convert the traditional IRA to a Roth IRA. ...
by Oicuryy
Thu Jul 12, 2018 4:20 pm
Forum: Investing - Theory, News & General
Topic: Treasury Auction - Nobody Came: "Great T-Bill Massacre"
Replies: 145
Views: 11874

Re: Treasury Auction - Nobody Came: "Great T-Bill Massacre"

Didn't the Fed just raise the Federal Funds rate to 2% in June and signal that there will be one more rate hike in 2018 than what had previously been anticipated? An uptick in T-Bill rates should not be too surprising. It isn't too surprising. https://fred.stlouisfed.org/graph/fredgraph.png?g=krYq ...
by Oicuryy
Tue Jul 10, 2018 2:31 pm
Forum: Investing - Theory, News & General
Topic: Treasury Auction - Nobody Came: "Great T-Bill Massacre"
Replies: 145
Views: 11874

Re: Treasury Auction - Nobody Came: "Great T-Bill Massacre"

The discount rate at today's (7/10/18) 28-day T-bill auction was 1.850%. The bid-to-cover ratio was 3.16.
https://treasurydirect.gov/instit/annce ... 0710_1.pdf

Ron
by Oicuryy
Fri Jul 06, 2018 8:06 pm
Forum: Investing - Help with Personal Investments
Topic: Help with Annuity and GLWB
Replies: 2
Views: 347

Re: Help with Annuity and GLWB

What is the current surrender value? I'm guessing its something like .94*484,539-.8*42,024 = 421,847. By doing so, the pre-tax totals would be: GLWB $263,323 and account value (using the guaranteed minimums): $495,437. I'm pretty sure you won't get both the GLWB withdrawals and the 495,437 account v...
by Oicuryy
Thu Jul 05, 2018 3:07 pm
Forum: Investing - Theory, News & General
Topic: Treasury Auction - Nobody Came: "Great T-Bill Massacre"
Replies: 145
Views: 11874

Re: Treasury Auction - Nobody Came: "Great T-Bill Massacre"

Results of Treasury auctions are posted on the TreasuryDirect web site. https://treasurydirect.gov/instit/annceresult/press/press.htm Results of Federal Reserve open market operations (OMO) are on the New York Fed's web site. Permanent OMO https://www.newyorkfed.org/markets/pomo_landing.html Tempora...
by Oicuryy
Mon Jul 02, 2018 12:18 pm
Forum: Investing - Theory, News & General
Topic: "homemade dividends" from Total Stock Market fund
Replies: 135
Views: 8696

Re: "homemade dividends" from Total Stock Market fund

Here is what the Bogleheads wiki says about the spend-only-the-dividends withdrawal method. If you wish to keep your principal investment amount intact, you might consider using a method where you only spend the dividend and interest income from your investments. The advantage is clear, but like the...
by Oicuryy
Sat Jun 30, 2018 3:55 pm
Forum: Investing - Theory, News & General
Topic: Ownership of Vanguard Funds and Underlying Stocks
Replies: 6
Views: 587

Re: Ownership of Vanguard Funds and Underlying Stocks

Here is a link to a Declaration of Trust for the Delaware statutory trust that Vanguard Total Stock Market Index Fund is a series of. It might not be current but it should give you a sense of what a mutual fund share is. https://www.sec.gov/Archives/edgar/data/36405/000093247109001014/indexfinal.txt...
by Oicuryy
Fri Jun 29, 2018 6:29 pm
Forum: Investing - Theory, News & General
Topic: "homemade dividends" from Total Stock Market fund
Replies: 135
Views: 8696

Re: "homemade dividends" from Total Stock Market fund

Carol88888 wrote:
Fri Jun 29, 2018 2:55 pm
I was wondering how much dividends were affected in the 2008 melt down.
Looks like some serious budget cutting in 2009 and 2010. Graph by me using data from Yahoo.

Image

Ron
by Oicuryy
Fri Jun 29, 2018 11:43 am
Forum: Investing - Theory, News & General
Topic: "homemade dividends" from Total Stock Market fund
Replies: 135
Views: 8696

Re: "homemade dividends" from Total Stock Market fund

Here is a Morningstar growth of $10k chart for VHDYX, VDAIX and VTSMX. VHDYX = VYM = Vanguard High Dividend Yield Index Fund VDAIX = VIG = Vanguard Dividend Appreciation Index Fund VTSMX = VTI = Vanguard Total Stock Market Index Fund http://quotes.morningstar.com/chart/fund/chart?t=VHDYX®ion=usa&...
by Oicuryy
Thu Jun 28, 2018 4:42 pm
Forum: Investing - Help with Personal Investments
Topic: Inflation Rate, isn't it personal?
Replies: 49
Views: 3558

Re: Inflation Rate, isn't it personal?

So we learn from the Atlanta Fed that change in Cost-of-Living and Inflation are not the same thing. Good to know. I just went googling for an explanation of the difference between inflation and cost of living. One of the first things I found was a blog post by an economist at the Atlanta Fed. It i...
by Oicuryy
Wed Jun 27, 2018 4:41 pm
Forum: Investing - Help with Personal Investments
Topic: Inflation Rate, isn't it personal?
Replies: 49
Views: 3558

Re: Inflation Rate, isn't it personal?

For those who have not yet watched the video The Atlanta Fed Explains Inflation here are some excerpts. "When the price level of goods and services goes up over a period of time we call that inflation. Inflation makes every dollar you own buy a smaller percentage of a product or service." "Prices ca...
by Oicuryy
Wed Jun 27, 2018 11:22 am
Forum: Investing - Help with Personal Investments
Topic: Inflation Rate, isn't it personal?
Replies: 49
Views: 3558

Re: Inflation Rate, isn't it personal?

And while you are correct, that inflation is same for all holding a currency since it is the theoretical effect on the purchasing power of a currency, the only thing that really matters are the affects of that inflation. Viewing inflation from your perspective, I assume you would agree that The Fed...
by Oicuryy
Tue Jun 26, 2018 10:26 pm
Forum: Investing - Help with Personal Investments
Topic: Inflation Rate, isn't it personal?
Replies: 49
Views: 3558

Re: Inflation Rate, isn't it personal?

The Federal Reserve Bank of Atlanta has a program named mycpi that offers perhaps a better estimation of your actual inflation. Of course no matter how many factors are used, the rate is still an estimation. The myCPI tool captures the uniqueness of the selection of goods that individuals purchase....
by Oicuryy
Tue Jun 26, 2018 6:01 pm
Forum: Investing - Help with Personal Investments
Topic: Inflation Rate, isn't it personal?
Replies: 49
Views: 3558

Re: Inflation Rate, isn't it personal?

No, inflation, correctly understood, is not personal. Inflation is best understood as an increase in prices due to a decline in the value of dollars . As the value of dollars declines it take more of them to buy something. Prices go up. As investors, we care about the decline in the value of dollars...
by Oicuryy
Sat Jun 23, 2018 4:53 pm
Forum: Personal Finance (Not Investing)
Topic: Are you smarter than my CPA? (IRA issue)
Replies: 17
Views: 1897

Re: Are you smarter than my CPA? (IRA issue)

My guess. 2016 Form 8606 (one of two) Line 1. 5500 3. 5500 14. 5500 2017 Form 8606 (one of two) Line 1. 5500 2. 5500 from 2016 3. 11000 5. 11000 8. 12035 total converted to Roth 9. 12035 10. 0.914 11. 11000 13. 11000 14. 0 no basis left in traditional IRA 16. 12035 17. 11000 18. 1035 also include on...
by Oicuryy
Fri Jun 22, 2018 9:02 am
Forum: Investing - Theory, News & General
Topic: Is technology the reason for low inflation?
Replies: 57
Views: 3317

Re: Is technology the reason for low inflation?

In short, the cause of inflation is an increase in fiat currency supply in our economy, and THAT causes price to go up. Close. Inflation is a decline in the value of money. As the value of money declines it takes more of it to buy stuff. Prices go up. Increasing the supply of money might lower its ...
by Oicuryy
Tue Jun 12, 2018 3:25 pm
Forum: Investing - Theory, News & General
Topic: Imagine a 10 year, 0%, noncallable loan
Replies: 49
Views: 3115

Re: Imagine a 10 year, 0%, noncallable loan

Say I was willing to pay up to 4% APR in interest. I would use the excel present value function like this. =PV(1.04^(1/12)-1,120,-1/120) 1.04^(1/12)-1 is the monthly interest rate corresponding to a 4% APR. 120 is the number of future monthly payments -1/120 is the fraction of my annual salary paid ...
by Oicuryy
Sun Jun 10, 2018 11:00 am
Forum: Personal Finance (Not Investing)
Topic: What does "tap into" the Social Security trust fund mean?
Replies: 29
Views: 2384

Re: What does "tap into" the Social Security trust fund mean?

"Tap into the trust fund" means pay part of Social Security benefits from sources of federal government revenue other than Social Security taxes. Think income taxes and/or treasury bonds.

Ron
by Oicuryy
Thu May 24, 2018 11:02 am
Forum: Personal Finance (Not Investing)
Topic: I need some math help-calculating interest savings
Replies: 31
Views: 1645

Re: I need some math help-calculating interest savings

Total interest on original loan. 360*1157 - 235200 =181320 Total interest on recast loan. 360*959.51 - 194506.99 = 150916.61 I calculate that prepaying 240.49 in principal each month would pay off the recast loan in 242 months. So total interest on recast loan with principle prepayments. 242*1200 - ...
by Oicuryy
Thu May 17, 2018 3:57 pm
Forum: Personal Finance (Not Investing)
Topic: IRMAA automatically determined/updated annually?
Replies: 6
Views: 577

Re: IRMAA automatically determined/updated annually?

As I read
Sec. 1839(i)(5)
, the 2020 IRMAA thresholds are scheduled to be adjusted by the increase, if any, in the CPI from August 2018 to August 2019. The thresholds for 2020 will be published in September 2019. But by then it will be too late to change your 2018 MAGI.

Ron
by Oicuryy
Thu May 17, 2018 11:50 am
Forum: Personal Finance (Not Investing)
Topic: IRMAA automatically determined/updated annually?
Replies: 6
Views: 577

Re: IRMAA automatically determined/updated annually?

Sec. 1839(i)(4)(B)(i) (i) In general.—In applying this subsection for an individual’s premiums in a month in a year, subject to clause (ii) and subparagraph (C), the individual’s modified adjusted gross income shall be such income determined for the individual’s last taxable year beginning in the s...
by Oicuryy
Sat May 12, 2018 6:05 pm
Forum: Forum Issues and Administration
Topic: Found cause of posts getting lost (not posted)
Replies: 13
Views: 1262

Re: Found cause of posts getting lost (not posted)

There is a warning, but it is not particularly eye catching.

Image

Ron
by Oicuryy
Sun Apr 29, 2018 1:49 pm
Forum: Investing - Theory, News & General
Topic: NAME for the MPT or CAPM-based diagram with the hyperbola and tangent line?
Replies: 114
Views: 6998

Re: NAME for the MPT or CAPM-based diagram with the hyperbola and tangent line?

dbr wrote:
Sun Apr 29, 2018 1:02 pm
Thanks. In that analysis variance is a quadratic in the return, hence a parabola.
You're welcome. I'm sure nisiprius is right about the name of the curve.

Ron
by Oicuryy
Sun Apr 29, 2018 12:26 pm
Forum: Investing - Theory, News & General
Topic: NAME for the MPT or CAPM-based diagram with the hyperbola and tangent line?
Replies: 114
Views: 6998

Re: NAME for the MPT or CAPM-based diagram with the hyperbola and tangent line?

I doubt any of the curves involved on these charts are either hyperbolas or ellipses. Is there some reason the curves should be described by those exact mathematical figures? This guy calls it a parabola and gives an equation for it. http://www.calculatinginvestor.com/2011/06/07/efficient-frontier-...
by Oicuryy
Wed Apr 25, 2018 11:44 am
Forum: Investing - Theory, News & General
Topic: Help poke holes? Roger Ibbotson recommends a Fixed Index Annuity as a partial bond alternative.
Replies: 23
Views: 1826

Re: Help poke holes? Roger Ibbotson recommends a Fixed Index Annuity as a partial bond alternative.

So he wrote an article that pretends to be about "a generic large cap equity FIA" when it is really about backtested results for one specific FIA. I wouldn't go that far. The skeptic in me suspects that the interest crediting method AnnGen created for Ibbotson's paper would (or would have) outperfo...
by Oicuryy
Wed Apr 25, 2018 10:31 am
Forum: Investing - Theory, News & General
Topic: Help poke holes? Roger Ibbotson recommends a Fixed Index Annuity as a partial bond alternative.
Replies: 23
Views: 1826

Re: Help poke holes? Roger Ibbotson recommends a Fixed Index Annuity as a partial bond alternative.

I know there’s one called New Heights 9 from a prominent, large Insurance company. FYI, The NYSE Zebra Edge® Index won Structured Retail Product’s Americas Award 2017 for Proprietary Index of the Year, Americas. The index was developed with Roger Ibbotson and Zebra Capital, and is exclusively avail...
by Oicuryy
Wed Apr 18, 2018 10:19 am
Forum: Investing - Theory, News & General
Topic: Theoretical question. What would happen if 100% of investors are buy and hold.
Replies: 19
Views: 2287

Re: Theoretical question. What would happen if 100% of investors are buy and hold.

What would happen if 100% of investors are buying and holding index funds? Then 100% of stocks would be owned by index funds. Would it still be profitable? Yes. The companies that index funds own would still be profitable and those profits would be passed on to the index funds' shareholders. How wi...
by Oicuryy
Mon Apr 16, 2018 11:53 am
Forum: Investing - Theory, News & General
Topic: How accurately can we measure INFLATION?
Replies: 89
Views: 4509

Re: How accurately can we measure INFLATION?

The Consumer Price Index (CPI) does not measure inflation. It measures the change in the price of a basket of consumer goods and services. The price of a thing, in dollars, is the ratio of the value of the thing to the value of a dollar. A price of five dollars for some thing means the value of the ...
by Oicuryy
Wed Apr 11, 2018 12:03 pm
Forum: Investing - Help with Personal Investments
Topic: SPIA Return - Am I calculating this correctly?
Replies: 72
Views: 3264

Re: SPIA Return - Am I calculating this correctly?

If the OP has sufficient investment assets, it might work better over the 15 years just to withdraw $4000 per month from a 50/50 (or thereabouts) portfolio. I'd recommend at least a 25X portfolio for confidence, meaning at least $1.2M for this case. That does not look much different from a 44/56 po...
by Oicuryy
Sat Mar 31, 2018 11:10 am
Forum: Investing - Help with Personal Investments
Topic: Vanguard: Transition to our new investment platform
Replies: 26
Views: 5776

Re: Vanguard: Transition to our new investment platform

I am happy with my current system. What are u guys choosing to do? Vanguard has not asked me to change yet, but I am choosing to stay with a mutual fund account. Vanguard has a brochure explaining the differences. https://www.vanguard.com/pdf/vbafqm.pdf This quote from the brochure is the reason I'...
by Oicuryy
Thu Mar 29, 2018 5:56 pm
Forum: Investing - Help with Personal Investments
Topic: Rollover to Vanguard requires brokerage account?
Replies: 24
Views: 2199

Re: Rollover to Vanguard requires brokerage account?

The prospectus for the S&P 500 fund says you can hold shares directly or through a broker. You will probably have to be insistent and not take no for an answer. Vanguard fund shares can be held directly with Vanguard or indirectly through an intermediary, such as a bank, a broker, or an investment a...
by Oicuryy
Sun Mar 25, 2018 10:40 pm
Forum: Investing - Help with Personal Investments
Topic: What is the chance of a purchase decreasing in value at some point?
Replies: 10
Views: 933

Re: What is the chance of a purchase decreasing in value at some point?

Using Yahoo's adjusted closing price for VFINX, 628 of the last 9641 prices, 6.5%, have not yet seen a lower price.

Ron
by Oicuryy
Tue Mar 20, 2018 11:10 am
Forum: Investing - Help with Personal Investments
Topic: Vanguard Managed Payout Fund VPGDX
Replies: 25
Views: 3369

Re: Vanguard Managed Payout Fund VPGDX

The portfolio of the managed payout fund it too conservative. Since its inception on 1/17/14 the balanced index fund has outperformed it as have two of the life strategy funds. http://quotes.morningstar.com/chart/fund/chart?t=VPGDX®ion=usa&culture=en_US&dataParams=%7B%22zoomKey%22%3A11%2C%22versi...
by Oicuryy
Sun Mar 18, 2018 9:37 pm
Forum: Investing - Theory, News & General
Topic: How banks create money, not from deposits
Replies: 132
Views: 11689

Re: How banks create money, not from deposits

The way banks create money was already understood in 1948. https://www.youtube.com/watch?time_continue=21&v=OJMJ24U0Jp4 Don't overlook the links under that video. Here is the uncut version of that 1948 film. https://archive.org/details/0537_Banks_and_Credit_19_41_46_04 This guy understood that all ...
by Oicuryy
Sun Mar 18, 2018 7:17 pm
Forum: Investing - Theory, News & General
Topic: How banks create money, not from deposits
Replies: 132
Views: 11689

Re: How banks create money, not from deposits

Here is a quote from the book alex_686 recommended earlier, Money: The Unauthorised Biography by Felix Martin Whilst all money is credit, not all credit is money: and it is the possibility of transfer that makes the difference. An IOU which remains for ever a contract between just two parties is not...
by Oicuryy
Sat Mar 17, 2018 1:03 pm
Forum: Investing - Theory, News & General
Topic: How banks create money, not from deposits
Replies: 132
Views: 11689

Re: How banks create money, not from deposits

Would everyone please read Chapter IV in the 1963 edition of The Federal Reserve System : Purposes and Functions. Chapter IV starts on page 63 of the original printed book and on page 84 of 318 of the online reader and pdf versions. https://fraser.stlouisfed.org/scribd/?title_id=4518&filepath=/files...
by Oicuryy
Fri Mar 16, 2018 12:27 pm
Forum: Investing - Theory, News & General
Topic: How banks create money, not from deposits
Replies: 132
Views: 11689

Re: How banks create money, not from deposits

Is the Money Multiplier Theory obsolete? Pretty much, yes. Under the fractional reserve theory of banking deposits are a multiple of reserve balances created by the central bank. Central banks can control the amount of deposits by changing reserve requirements and/or changing the amount of reserves...
by Oicuryy
Fri Mar 16, 2018 8:28 am
Forum: Investing - Theory, News & General
Topic: How banks create money, not from deposits
Replies: 132
Views: 11689

Re: How banks create money, not from deposits

OnTrack wrote:
Fri Mar 16, 2018 12:05 am
How does this chart not support the multiplier theory?
The chart is the ratio of a measure of the money supply, M2, to the amount of reserve balances banks have at the Fed. The fractional reserve theory claims that ratio is fixed. The chart shows that the ratio is not fixed.

Ron
by Oicuryy
Thu Mar 15, 2018 11:39 pm
Forum: Investing - Theory, News & General
Topic: How banks create money, not from deposits
Replies: 132
Views: 11689

Re: How banks create money, not from deposits

Member/customer deposits check for $100,000 into her savings. The left side of the balance sheet goes up by $100,000 when that check is deposited into the credit union's "bank" account or the credit union purchases an investment. The right side of the balance sheet goes up by $100,000 because the s...
by Oicuryy
Thu Mar 15, 2018 10:48 pm
Forum: Investing - Theory, News & General
Topic: How banks create money, not from deposits
Replies: 132
Views: 11689

Re: How banks create money, not from deposits

I'm not buying that money multiplier theory.

Image
https://fred.stlouisfed.org/graph/?g=j5tT

Ron
by Oicuryy
Thu Mar 15, 2018 3:33 pm
Forum: Investing - Theory, News & General
Topic: How banks create money, not from deposits
Replies: 132
Views: 11689

Re: How banks create money, not from deposits

dm200, When a customer deposits a check at your credit union the check becomes an asset of the credit union and the increase in his checking account balance becomes a liability, right? I cluelessly claim the same thing happens when a customer gives your credit union an IOU. The IOU becomes an asset ...
by Oicuryy
Thu Mar 15, 2018 11:46 am
Forum: Investing - Theory, News & General
Topic: How banks create money, not from deposits
Replies: 132
Views: 11689

Re: How banks create money, not from deposits

If I could buy a bond without having money I would buy $100 billion worth of bonds and, at 1%, receive $1 billion dollars per year in interest. Let me re-word that slightly. If I could create money I would buy $100 billion worth of bonds and, at 1%, receive $1 billion dollars per year in interest. ...
by Oicuryy
Wed Mar 14, 2018 9:22 pm
Forum: Investing - Theory, News & General
Topic: How banks create money, not from deposits
Replies: 132
Views: 11689

Re: How banks create money, not from deposits

Grayfox, The $100 bills were assets of the bank. When you withdrew them you lowered the bank's assets and its liabilities (your account balance). But the bank still has your IOU as an asset. So its assets and liabilities are back to where they were before you got the loan. From the bank's point of v...