Anyone else hoarding cash right now?

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SVT
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Re: Anyone else hoarding cash right now?

Post by SVT »

Before the pandemic, I had a 6 figure amount in cash in high yield savings and for bank account bonuses. Since the pandemic, I've invested all the cash I could make available and have pretty much just enough to cover expenses. New money gets immediately invested.
FoolStreet
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Re: Anyone else hoarding cash right now?

Post by FoolStreet »

JustinR wrote: Wed Aug 05, 2020 6:34 am I stopped investing in my taxable back in March and can't bring myself to start again. I'm still investing automatically in my 401k.

I'm just holding onto my cash in case of a worst case scenario if society collapses and I need liquid funds. I don't mean the case where you'd have to live in a bunker and have guns/ammo. There are smaller degrees of societal collapse than that.

So far it seems like it won't be the case, but who knows? There's no end in sight.


Edit: By cash, I mean in a bank account. Like overfunding your emergency fund, as opposed to investing.
We are about 70/30 stock:fixed income over our various accounts. We have a chunk of 'cash' in munis and state money markets based on this AA. It is unnerving to have so much 'cash' sitting around. But I think that's the Boglehead-way...which is to increase the Bond portion of your AA by about 1% by every year you get older. Therefore, I will continue to have cash and more cash -- soon it will be 65/35, then 60/40. Seems really weird to me. It makes me uncomfortable to have so much (relatively) cash just sitting there. But isn't that what we are supposed to do?
nigel_ht
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Re: Anyone else hoarding cash right now?

Post by nigel_ht »

guyinlaw wrote: Sat Aug 08, 2020 4:35 pm Greed index is at 72 heading higher, Put Call ratio is at close to the low for the year. Majority of traders are super bullish.

Image
https://money.cnn.com/data/fear-and-greed/

Yes, there are many reasons why markets can go lower - schools opening, COVID spreading, pre and post-election issues, China etc..

Reasons for being bullish..
1. Do remember that Fed is watching our back! They will step in if stocks drop + they will keep pushing down 10Y and LT rates lower.
2. Nowhere else for all the money to go other than stocks.
3. Lot of money still in sidelines.

Listen to Rick Ferri on the WCI podcast recently. I am paraphrasing -"The retirement funds that need to return 6%, where can the invest? They will have to increase allocation to stocks." https://www.youtube.com/watch?v=2JS6rmlDmas
When the fear meter pegged I started buying.

When the greed index gets high I pull back a little.

Option traders are wrong most of the time so being contrarian strikes me as safer.
GoldenFinch
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Re: Anyone else hoarding cash right now?

Post by GoldenFinch »

WildCat48 wrote: Sat Aug 08, 2020 1:52 pm We are sitting on just under $5M in cash which is a bit more than usual for us.
I think you could probably afford to use some of that to buy a couch or a couple chairs to make yourselves a little more comfortable. :wink:
InvestorP
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Re: Anyone else hoarding cash right now?

Post by InvestorP »

StormShadow wrote: Sat Aug 08, 2020 10:58 am
InvestorP wrote: Wed Aug 05, 2020 11:04 pm
StormShadow wrote: Wed Aug 05, 2020 9:06 am Probably because gold has been universally accepted as a valuable commodity across multiple civilizations throughout the planet for thousands of years.
All the investments in gold are through the stockmarket though. The average investor doesn't actually own physical gold. So I'm thinking if society collapses, will those people who "own" gold actually get the phsycial gold? Especially if it's the apocoplyse.

This is a fun thread. :D
What are you talking about?

DW carries gold in her right upper molar. It is a small but significant percentage of our portfolio. Also helps her chew.

I'm betting it'll be able to purchase a cup of coffee even 20-30 years from now.
You know what? I didn't think of that. I just pictured the actual gold brick. But I forgot about people walking around with watches and chains.
sailaway
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Re: Anyone else hoarding cash right now?

Post by sailaway »

InvestorP wrote: Sat Aug 08, 2020 9:24 pm
StormShadow wrote: Sat Aug 08, 2020 10:58 am
InvestorP wrote: Wed Aug 05, 2020 11:04 pm
StormShadow wrote: Wed Aug 05, 2020 9:06 am Probably because gold has been universally accepted as a valuable commodity across multiple civilizations throughout the planet for thousands of years.
All the investments in gold are through the stockmarket though. The average investor doesn't actually own physical gold. So I'm thinking if society collapses, will those people who "own" gold actually get the phsycial gold? Especially if it's the apocoplyse.

This is a fun thread. :D
What are you talking about?

DW carries gold in her right upper molar. It is a small but significant percentage of our portfolio. Also helps her chew.

I'm betting it'll be able to purchase a cup of coffee even 20-30 years from now.
You know what? I didn't think of that. I just pictured the actual gold brick. But I forgot about people walking around with watches and chains.
Our roommate once insisted that gold is much cheaper in India, but I had always assumed.she meant gold jewelry, with it's jewelry mark up, rather than raw gold.
ThePrince
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Re: Anyone else hoarding cash right now?

Post by ThePrince »

StormShadow wrote: Wed Aug 05, 2020 9:06 am
egrets wrote: Wed Aug 05, 2020 6:51 am
KlangFool wrote: Wed Aug 05, 2020 6:48 am I have 2 years of expenses in cash. I bought some gold and silver. I would invest the rest until I reach my number. Then, I may buy more gold and silver.

KlangFool
I never understand why people think gold is valuable if society collapses. It's not like you can eat it.
Probably because gold has been universally accepted as a valuable commodity across multiple civilizations throughout the planet for thousands of years.
+1
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mickeyd
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Re: Anyone else hoarding cash right now?

Post by mickeyd »

Edit: By cash, I mean in a bank account. Like overfunding your emergency fund, as opposed to investing.
My definition is a bit different in that I include PMMF, CD and STB fund. All of that stash represents ST cash that I can immediately access if I need it. So far I have had little need for it, it just looks pretty.
Part-Owner of Texas | | “The CMH-the Cost Matters Hypothesis -is all that is needed to explain why indexing must and will work… Yes, it is that simple.” John C. Bogle
Actin
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Re: Anyone else hoarding cash right now?

Post by Actin »

An emergency fund or hoarding cash is only for injuries that prevent you from working or the loss of a job for whatever other reason.

Corona showed me that how much cash or gold you have is useless if the grocery store is empty. Corona wasn't even that bad. Imagine a global war or global natural disasters. Imagine the water, sanitation, and electrical systems were also down.

People that buy gold are romanticizing an apocalyptic event. In the event that the dollar becomes useless, [OT comment removed by admin LadyGeek] or people looking for food long before society restarts.

I'm not changing my six month emergency fund and all my extra cash is still going to VTSAX every month. I am buying extra cases of bottled water and extra frozen chicken,frozen vegetables, etc, every time I go to the grocery store though.
rockstar
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Re: Anyone else hoarding cash right now?

Post by rockstar »

Nope.

Low interest rates are pushing up asset values. With the fed unlikely to raise rates until 2022, I don't see the point in hoarding additional cash right now. I am paying down my mortgage faster though, which I'm questioning.
austin757
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Re: Anyone else hoarding cash right now?

Post by austin757 »

I have basically no cash at all, other than $6 in my checking account. I'm all in equities for now. I have a while before retirement. Still, seeing lots of people hoarding cash makes me think twice, but I feel I have time to recover should the market take a huge plunge again.
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cashboy
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Re: Anyone else hoarding cash right now?

Post by cashboy »

no more cash than before.

but i do have an additional reserve of 2 bulk packages of TP :wink:

https://www.scottbrand.com/en-us/produc ... ilet-paper
Three-Fund Portfolio: FSPSX - FXAIX - FXNAX (with slight tilt of CDs - CASH - Canned Beans - Rice - Bottled Water)
Robot Monster
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Re: Anyone else hoarding cash right now?

Post by Robot Monster »

cashboy wrote: Sun Aug 09, 2020 1:25 pm no more cash than before.

but i do have an additional reserve of 2 bulk packages of TP :wink:

https://www.scottbrand.com/en-us/produc ... ilet-paper
Toilet paper is inflation protected like TIPS, but better because it gets much better tax treatment, and it's much less volatile than gold. Unfortunately it's too bulky, and not easily re-sellable. Otherwise I would build a literal TP fortress with a moat and everything. It would be like Castle Greyskull, but soft and cushiony.
Dead Man Walking
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Re: Anyone else hoarding cash right now?

Post by Dead Man Walking »

I’m not hoarding cash, but I have chosen to put the proceeds from maturing CDs in a savings account. The fixed income portion of my portfolio has a greater percentage of cash because interest rates on CDs and bonds are so low that I’m not interested in them. My asset allocation is within the range of my ips. If the market suffers a setback, I’ll probably increase my allocation to equities. Currently, everything is too expensive for a buy low sell high investor. For those of you who would consider this as market timing, please note that my asset allocation is within the range specified by my ips.

DMW
Robot Monster
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Re: Anyone else hoarding cash right now?

Post by Robot Monster »

Dead Man Walking wrote: Sun Aug 09, 2020 4:21 pm I’m not hoarding cash, but I have chosen to put the proceeds from maturing CDs in a savings account. The fixed income portion of my portfolio has a greater percentage of cash because interest rates on CDs and bonds are so low that I’m not interested in them. My asset allocation is within the range of my ips. If the market suffers a setback, I’ll probably increase my allocation to equities. Currently, everything is too expensive for a buy low sell high investor. For those of you who would consider this as market timing, please note that my asset allocation is within the range specified by my ips.

DMW
Sounds perfectly reasonable. When would stocks be a buy for you, out of curiosity? Do you follow the CAPE ratio? S&P's CAPE is a tad high at 31.
mak1277
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Re: Anyone else hoarding cash right now?

Post by mak1277 »

Sconie wrote: Sat Aug 08, 2020 12:29 pm
Bullets? I bet you mean loaded ammunition, not just the projectile portion of the complete cartridge.
Only a bored pedant would miss my point on bullets.
Dead Man Walking
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Re: Anyone else hoarding cash right now?

Post by Dead Man Walking »

Robot Monster wrote: Sun Aug 09, 2020 6:00 pm
Dead Man Walking wrote: Sun Aug 09, 2020 4:21 pm I’m not hoarding cash, but I have chosen to put the proceeds from maturing CDs in a savings account. The fixed income portion of my portfolio has a greater percentage of cash because interest rates on CDs and bonds are so low that I’m not interested in them. My asset allocation is within the range of my ips. If the market suffers a setback, I’ll probably increase my allocation to equities. Currently, everything is too expensive for a buy low sell high investor. For those of you who would consider this as market timing, please note that my asset allocation is within the range specified by my ips.

DMW
Sounds perfectly reasonable. When would stocks be a buy for you, out of curiosity? Do you follow the CAPE ratio? S&P's CAPE is a tad high at 31.
Since my allocation to equities is well within the range of my target allocation and gradually increasing, the setback would have to be a drop in the CAPE to the 15-20 range. Such a drop would probably trigger a necessary rebalancing. If I’m rebalancing, I may increase my equity allocation by 5-10%.

DMW
euphonious
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Re: Anyone else hoarding cash right now?

Post by euphonious »

According to the current MZM (money zero maturity) numbers, there are a lot more people hoarding cash right now than there were at the beginning of March.

https://fred.stlouisfed.org/series/MZM

Upon reflection, perhaps it would be more accurate to say there is a lot more cash being hoarded right now. I don't know if that necessarily translates to more people.
rascott
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Re: Anyone else hoarding cash right now?

Post by rascott »

I'm investing for the next 40+ years. What happens this year will be a tiny blip on the radar when we look back upon it in 2060.

If you are concerned with equity prices in the next 5-10 years, you shouldn't be buying equities.
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UncleLeo
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Re: Anyone else hoarding cash right now?

Post by UncleLeo »

rockthisworld wrote: Sat Aug 08, 2020 12:05 pm
JustinR wrote: Wed Aug 05, 2020 6:34 am I stopped investing in my taxable back in March and can't bring myself to start again. I'm still investing automatically in my 401k.

I'm just holding onto my cash in case of a worst case scenario if society collapses and I need liquid funds. I don't mean the case where you'd have to live in a bunker and have guns/ammo. There are smaller degrees of societal collapse than that.

So far it seems like it won't be the case, but who knows? There's no end in sight.


Edit: By cash, I mean in a bank account. Like overfunding your emergency fund, as opposed to investing.
I cashed out half of my portfolio in July. I just saw a lot in the data if you look at high unemployment, benefits running out Jul 31st maybe reinstated soon with less benefits which hurt consumers. And either way we are adding debt at a massive level. Money is debt. I’m holding cash and either going to deploy it into SP500 if it starts to crash (20-30%) start to DCA or gold pulls back to the $1800 resistance or housing market comes down about 15-20% or a combination of the three. I’m not sure what the future holds but I’m waiting for value.
What if we never see -20% below current levels? What if the next 20% crash happens only after 30%+ additional rally? When will you be back to your desired AA in this case?
"adding debt at a massive level. Money is debt" - Isn't this a reason to be bullish on stocks? more money in circulation => inflationaly force.
anoop
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Re: Anyone else hoarding cash right now?

Post by anoop »

rascott wrote: Tue Aug 11, 2020 2:09 am If you are concerned with equity prices in the next 5-10 years, you shouldn't be buying equities.
That's not what Powell said. He said to go all in.
https://www.youtube.com/watch?v=dBTfIIm ... .be&t=3401
Valuethinker
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Re: Anyone else hoarding cash right now?

Post by Valuethinker »

euphonious wrote: Tue Aug 11, 2020 1:56 am According to the current MZM (money zero maturity) numbers, there are a lot more people hoarding cash right now than there were at the beginning of March.

https://fred.stlouisfed.org/series/MZM

Upon reflection, perhaps it would be more accurate to say there is a lot more cash being hoarded right now. I don't know if that necessarily translates to more people.
What is happening is that people would have spent money on restaurants, live entertainment & sporting events, travel, airlines, shopping etc and now they are not?

In addition everyone must know someone who lost their job in this? And the real hit to middle class employment in higher education, state & local government has not hit yet? You are going to see higher education institutions actually go broke this year. Many institutions are reliant on their overseas students & higher fees, and those students will just not be coming this year. In Asia they are highly aware of the Covid-19 statistics in UK & USA, the lack of compliance with public safety measures, etc - as a parent in Taiwan or PRC you going to send your kid into that? Many of the worst new outbreaks are associated with students, partying etc.

EDIT: I should mention healthcare which is an absolutely huge employer alongside education (school + university). There have been big layoffs, I gather, and as more people go without insurance and hospitals are diverted to ICU, elective procedures are cancelled or delayed, it probably gets worse.

A lot of companies are busily building up to their second round of layoffs phase.

People are hoarding cash because there is a horrible recession out there, and no signs it is going to get rapidly better.
Last edited by Valuethinker on Tue Aug 11, 2020 4:08 am, edited 1 time in total.
Valuethinker
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Re: Anyone else hoarding cash right now?

Post by Valuethinker »

sailaway wrote: Sat Aug 08, 2020 9:28 pm
InvestorP wrote: Sat Aug 08, 2020 9:24 pm
StormShadow wrote: Sat Aug 08, 2020 10:58 am
InvestorP wrote: Wed Aug 05, 2020 11:04 pm
StormShadow wrote: Wed Aug 05, 2020 9:06 am Probably because gold has been universally accepted as a valuable commodity across multiple civilizations throughout the planet for thousands of years.
All the investments in gold are through the stockmarket though. The average investor doesn't actually own physical gold. So I'm thinking if society collapses, will those people who "own" gold actually get the phsycial gold? Especially if it's the apocoplyse.

This is a fun thread. :D
What are you talking about?

DW carries gold in her right upper molar. It is a small but significant percentage of our portfolio. Also helps her chew.

I'm betting it'll be able to purchase a cup of coffee even 20-30 years from now.
You know what? I didn't think of that. I just pictured the actual gold brick. But I forgot about people walking around with watches and chains.
Our roommate once insisted that gold is much cheaper in India, but I had always assumed.she meant gold jewelry, with it's jewelry mark up, rather than raw gold.
The markup on jewelry is sufficiently high that I don't think it is a good way to keep precious metals.

Unless the jewelry has some intrinsic artistic value, I believe if you try to sell it back you will get 25-50% discounts on value.

I think the markup is c 250%, ie what costs the dealer $40 they sell to you for $100, you knock them down to $85 maybe on the haggle.

Coins also have a big markup but the discounts are not so large when you sell back. There's been a lot of threads here.
tiburblium
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Re: Anyone else hoarding cash right now?

Post by tiburblium »

I’m hoarding equities, I wouldn’t sleep well at night holding cash in this environment.
UpperNwGuy
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Re: Anyone else hoarding cash right now?

Post by UpperNwGuy »

I haven't changed a thing. I still invest the same amount on the first of each month into my 60/40 portfolio. I still put the same amount into short and intermediate term savings. The savings balance is a bit higher than usual at the moment because I plan to buy a new car in the next month or two. I don't share OP's dire view of the world.
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TomatoTomahto
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Re: Anyone else hoarding cash right now?

Post by TomatoTomahto »

Valuethinker wrote: Tue Aug 11, 2020 4:03 am People are hoarding cash because there is a horrible recession out there, and no signs it is going to get rapidly better.
Thank you Valuethinker for once again simply stating what should be obvious to everyone but doctrinaire Bogleheads. Those with a sufficient cushion, FOMO, and a 40+ year investing horizon can continue to pump up equities.
I get the FI part but not the RE part of FIRE.
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CyclingDuo
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Re: Anyone else hoarding cash right now?

Post by CyclingDuo »

Valuethinker wrote: Tue Aug 11, 2020 4:03 amPeople are hoarding cash because there is a horrible recession out there, and no signs it is going to get rapidly better.
Meanwhile, we have a golden cross setting up in the Dow Transports and the Russell 2000...
"Save like a pessimist, invest like an optimist." - Morgan Housel
columbia
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Re: Anyone else hoarding cash right now?

Post by columbia »

Since mid-March, we haven't paid for a sit down meal, been to a bar, travelled overnight, taken a day trip or even purchased an article of clothing. (I'm sure I'm forgetting a few others.)
hudson
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Re: Anyone else hoarding cash right now?

Post by hudson »

JustinR wrote: Wed Aug 05, 2020 6:34 am I stopped investing in my taxable back in March and can't bring myself to start again. I'm still investing automatically in my 401k.

I'm just holding onto my cash in case of a worst case scenario if society collapses and I need liquid funds. I don't mean the case where you'd have to live in a bunker and have guns/ammo. There are smaller degrees of societal collapse than that.

So far it seems like it won't be the case, but who knows? There's no end in sight.


Edit: By cash, I mean in a bank account. Like overfunding your emergency fund, as opposed to investing.


I don't think of it as hoarding cash in case of a societal collapse. I want more liquidity.

I define cash almost like you do as money in a bank account. Cash to me is money that I can transfer into my checking account on the same business day. My goal is to have roughly $20K available; I don't think of it as an emergency fund, but I guess that's what it is. Usually if I have $20K available, I'm comfortable that I can solve most problems that pop up.

Two times last summer, I needed to write checks, and the money wasn't there. It was just poor planning. I had to beg off until I could sell some holdings and transfer it to my bank. I decided that having every dime fully invested was causing more problems than it was worth....so I want $20K available even though I lose some interest. I use AMEX Bank (1% interest) to hold this "cash fund." All dividends now go to AMEX Bank until I reach $20K.

Bottom Line: I've switched from "every dime fully invested" to "invest every dime after filling a $20K cash fund."
Last edited by hudson on Tue Aug 11, 2020 9:20 am, edited 2 times in total.
bck63
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Re: Anyone else hoarding cash right now?

Post by bck63 »

following
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goodenyou
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Re: Anyone else hoarding cash right now?

Post by goodenyou »

I have “excess” cash that is de-risking my portfolio. I am willing to pay for the privilege of myopic loss aversion because I have met my financial goals. If things were more stable, I would most likely deploy the cash into bond funds. Investors will likely be rewarded for their risk taking either in the short term or long term. Nobody knows for certain. My life goals are in the short term. I don’t have the luxury (or desire) to weather volatility for an extended period of time.
"Ignorance more frequently begets confidence than does knowledge" | Do you know how to make a rain dance work? Dance until it rains.
Independent George
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Re: Anyone else hoarding cash right now?

Post by Independent George »

I'm hoarding cash right now because:

1. I canceled my vacation plans
2. Restaurants are still mostly closed
3. I'm concerned about my job security

This has nothing to do with fears of a societal collapse, and everything to do with risk management in a changing environment.
guyinlaw
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Re: Anyone else hoarding cash right now?

Post by guyinlaw »

Waiting on the sidelines for a crash is too risky. Better setup a plan to get back to pre-pandemic asset allocation and execute. Even if it is dollar cost average. There may or may not be a crash in Fall/Winter. Yes, if you have permanently changed your AA that works too.

I keep getting reminder of Rick Ferri talking about people who went to cash in 2008 and are still there.
Time is your friend; impulse is your enemy. - John C. Bogle
pascalwager
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Re: Anyone else hoarding cash right now?

Post by pascalwager »

I'm not hoarding, but I keep a modest cash buffer (~$35k) in local bank checking and online bank savings. This way I rarely need to sell any stocks or bonds as I maintain the buffer through non-portfolio direct-deposits for general living expenses.

Should I be hoarding? Maybe so, at least to the point of having two-years of living expenses in cash. But this much cash would need to be accumulated over a few years time to control taxable income unless I was willing to deplete my Roth account.

Humans evolved living in small groups (nine-to-fourteen people), not in a highly contagion-inducing world mass society. Pandemics could be the rule in the future.
000
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Re: Anyone else hoarding cash right now?

Post by 000 »

pascalwager wrote: Wed Aug 12, 2020 8:06 pm I'm not hoarding, but I keep a modest cash buffer (~$35k) in local bank checking and online bank savings. This way I rarely need to sell any stocks or bonds as I maintain the buffer through non-portfolio direct-deposits for general living expenses.

Should I be hoarding? Maybe so, at least to the point of having two-years of living expenses in cash. But this much cash would need to be accumulated over a few years time to control taxable income unless I was willing to deplete my Roth account.

Humans evolved living in small groups (nine-to-fourteen people), not in a highly contagion-inducing world mass society. Pandemics could be the rule in the future.
Not sure fiat cash is what you want if that happens...

Pb and Au come to mind.
Ed_Sandwich
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Re: Anyone else hoarding cash right now?

Post by Ed_Sandwich »

JustinR wrote: Wed Aug 05, 2020 6:34 am I stopped investing in my taxable back in March and can't bring myself to start again. I'm still investing automatically in my 401k.

I'm just holding onto my cash in case of a worst case scenario if society collapses and I need liquid funds. I don't mean the case where you'd have to live in a bunker and have guns/ammo. There are smaller degrees of societal collapse than that.

So far it seems like it won't be the case, but who knows? There's no end in sight.


Edit: By cash, I mean in a bank account. Like overfunding your emergency fund, as opposed to investing.
If you watch the news too much the world tends to seem that way. My personal view is that things will return to 'normal' very soon. Call me an optimist. But there are megacorps that make money by keeping our attention, and nothing keeps our attention like disaster.
gator15
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Re: Anyone else hoarding cash right now?

Post by gator15 »

Badger97 wrote: Wed Aug 05, 2020 11:23 am
Escapevelocity wrote: Wed Aug 05, 2020 9:41 am
Badger97 wrote: Wed Aug 05, 2020 6:54 am We are holding more cash than usual, but I don't know that it's hoarding per se.

We have a tuition bill coming due, a huge tax bill due next April, and are planning to build a new house. So having cash is important, but it has nothing to do with the state of the market.

We are planning to do a cash-out refinance on our main house and maybe even a second home. That would move about $300K of equity from the house into cash. At these rates, we definitely want to do this.
What types of rates are you seeing on cash-out Refi?
2.75% for 30 years at 80% LTV with $1100 costs.
How are your costs so low? I got the same rate for a 20 yr mortgage and my costs are 3x your costs and with prepaid it’s closer to 6x your costs
Jng2020
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Re: Anyone else hoarding cash right now?

Post by Jng2020 »

Hello
We have 18 years until retirement.
Current very little cash positions (9 months emergency monies fund).

80% stocks 20% bonds, most funds in Vanguard account.
Will rebalance portfolio 6_18 months before retiring.

Which funds ETFs banks-cd do you use to get highest yields.
hudson
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Slim Pickings

Post by hudson »

Jng2020 wrote: Wed Aug 12, 2020 10:14 pm Which funds ETFs banks-cd do you use to get highest yields.
For cash...Amex Bank...1%
For CDs...I consult the Boglehead CD discussion or https://www.bankrate.com/banking/cds/cd-rates/
For funds...Vang Intermed. Muni (there is an ETF, VTEB...but I like VWITX/VWIUX better)

Boglehead CD rates discussion: viewtopic.php?t=292085

Bottom Line: My situation might be different than yours; I'm sure that you'll do your homework before making a move.
Last edited by hudson on Thu Aug 13, 2020 6:34 am, edited 1 time in total.
macheta
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Re: Anyone else hoarding cash right now?

Post by macheta »

A lot of people are hoarding cash right now due to the pandemic. This is a natural survival technique humans make because that's how the brain operates. Its okay to hoard but just realize that unless you have a serious risk of losing a job, you are making an emotional decision and not a financial decision.

I did the same thing at the beginning of the pandemic.
Ed_Sandwich
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Re: Anyone else hoarding cash right now?

Post by Ed_Sandwich »

pascalwager wrote: Wed Aug 12, 2020 8:06 pm Pandemics could be the rule in the future.
Anything could happen but there is thought now in the scientific community that this could possibly be the last (or certainly the longest) pandemic we face as a species if they are able to create an RNA vaccine. This was previously a niche "nice to have" field of research but now there is (obviously) a lot of focus and progress. I am not in the field or involved in any way but this is something I read.
Dead Man Walking
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Re: Anyone else hoarding cash right now?

Post by Dead Man Walking »

columbia wrote: Tue Aug 11, 2020 6:49 am Since mid-March, we haven't paid for a sit down meal, been to a bar, travelled overnight, taken a day trip or even purchased an article of clothing. (I'm sure I'm forgetting a few others.)
+1 I’m not hoarding cash, but I’m not spending any. Direct deposits to my checking account are ballooning my balance.

DMW
glensos
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Joined: Sat Aug 01, 2009 7:09 pm

Re: Anyone else hoarding cash right now?

Post by glensos »

Not me....

I Re-balanced in March, and borrowed 200K from my low cost credit line with the custodian. Now I trying to rebalance back, but the gains are so large, i need to wait till next year to sell all the securities with gains. It has been a fabulous year!

Glen
lane7068
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Joined: Sun Feb 23, 2020 12:10 am

Re: Anyone else hoarding cash right now?

Post by lane7068 »

Im hoarding a good bit of cash now, mostly because I was too greedy (or scared) and didn't deploy nearly enough back around March 23rd thinking it will go lower, and only bought a bit each week as normal. I still make small weekly purchases though in my Vanguard and little M1 account as well as maxing my TSP.

I'll not make that mistake again. I've made an excel spreadsheet based on how much I'll deploy when the DJI reaches a certain point (DJI 26,000-add $5000, DJI 25,000-add$10,000, DJI 24,000-add $15,000, and on down to DJI 18,000).
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UncleLeo
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Re: Anyone else hoarding cash right now?

Post by UncleLeo »

lane7068 wrote: Fri Aug 14, 2020 3:30 am Im hoarding a good bit of cash now, mostly because I was too greedy (or scared) and didn't deploy nearly enough back around March 23rd thinking it will go lower, and only bought a bit each week as normal. I still make small weekly purchases though in my Vanguard and little M1 account as well as maxing my TSP.

I'll not make that mistake again. I've made an excel spreadsheet based on how much I'll deploy when the DJI reaches a certain point (DJI 26,000-add $5000, DJI 25,000-add$10,000, DJI 24,000-add $15,000, and on down to DJI 18,000).
What's the plan if DJI never reaches 26,000, or if it reaches 22,000 but never reaches 18,000 (which seems extremely unlikely given the actions of the Fed).
If my calculation is correct, you have 225K out of the market. will you keep this amount or some of it out of the market forever if it doesn't reach your buying target?
lane7068
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Re: Anyone else hoarding cash right now?

Post by lane7068 »

UncleLeo,

You bring up a good point. Not quite that much, but close enough. Considering I'm already maxing my TSP, Roth IRA, and have plenty of in my Vanguard taxable and a small amount in my M1 taxable play account I opened this year, I'm in no rush to throw a lot of money at this market right now. I did pick up my purchases on the way down just not as much as I should have. I still make my small weekly and bi-weekly purchases in all accounts, DCA'ing as I go, so I'm in no rush to make a rash move. What goes up will eventually go down.

As for Fed intervention, its possible we might never see below 26k, 22k, or 18k. I wouldn't personally bet on that. We just dropped to 18.5 or so in record time, so I think its safe to assume it can happen again. I'll keep playing my game in the meantime because I'm comfortable with that.
KlangFool
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Re: Anyone else hoarding cash right now?

Post by KlangFool »

sperry8 wrote: Thu Aug 06, 2020 12:20 pm
KlangFool wrote: Wed Aug 05, 2020 7:11 am Hoping to be lucky is not a good strategy. Be prepared for a full range of possibilities is a good thing. Diversification is a good thing.

If you are worried enough to hold more cash, you should stock up some food, water, silver, and gold.

KlangFool
And then, by your logic, bitcoin as well.
I don't trust bitcoin.

KlangFool
apex84
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Location: Chicago

Re: Anyone else hoarding cash right now?

Post by apex84 »

Indian jewelry may be an exception. It is 22k gold and sold by weight. The price either includes a markup or it is broken out separately as making charges. You can easily trade it in towards other pieces (some stores provide 100% of the purchase price back).

Until modern banking became widely available in India, families often stored their savings in the form of gold and silver jewelry and household items.
Valuethinker wrote: Tue Aug 11, 2020 4:06 am The markup on jewelry is sufficiently high that I don't think it is a good way to keep precious metals.

Unless the jewelry has some intrinsic artistic value, I believe if you try to sell it back you will get 25-50% discounts on value.

I think the markup is c 250%, ie what costs the dealer $40 they sell to you for $100, you knock them down to $85 maybe on the haggle.

Coins also have a big markup but the discounts are not so large when you sell back. There's been a lot of threads here.
nigel_ht
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Re: Anyone else hoarding cash right now?

Post by nigel_ht »

lane7068 wrote: Fri Aug 14, 2020 11:43 am UncleLeo,

You bring up a good point. Not quite that much, but close enough. Considering I'm already maxing my TSP, Roth IRA, and have plenty of in my Vanguard taxable and a small amount in my M1 taxable play account I opened this year, I'm in no rush to throw a lot of money at this market right now. I did pick up my purchases on the way down just not as much as I should have. I still make my small weekly and bi-weekly purchases in all accounts, DCA'ing as I go, so I'm in no rush to make a rash move. What goes up will eventually go down.

As for Fed intervention, its possible we might never see below 26k, 22k, or 18k. I wouldn't personally bet on that. We just dropped to 18.5 or so in record time, so I think its safe to assume it can happen again. I'll keep playing my game in the meantime because I'm comfortable with that.
It’s not really a good point...just reset your limits based on current highs. Also, right now is a very weird time but eventually things will be back to normal and you can reduce your cash hoard a bit.

You can also slowly DCA back in if you’re worried about the market pulling back this fall/winter
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nisiprius
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Re: Anyone else hoarding cash right now?

Post by nisiprius »

StormShadow wrote: Wed Aug 05, 2020 9:06 am
egrets wrote: Wed Aug 05, 2020 6:51 am
KlangFool wrote: Wed Aug 05, 2020 6:48 am I have 2 years of expenses in cash. I bought some gold and silver. I would invest the rest until I reach my number. Then, I may buy more gold and silver.

KlangFool
I never understand why people think gold is valuable if society collapses. It's not like you can eat it.
Probably because gold has been universally accepted as a valuable commodity across multiple civilizations throughout the planet for thousands of years.
Thank you for carefully phrasing that in a way that makes it accurate, although "widely" would be better than "universally."
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
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