Money & Economics

[mat200]

Been noticing Muni Bonds are holding above 5% and just recently the Gov't voted to keep them tax free still...

Savings is down to 4% but that has been going down from 5% starting most all of last year with the Feds dropping Interest rates. I am still ok with 4%, not long ago, Savings was at 0%

Mortgage rates have only slightly come down, not much to make any major difference. If Feds cut more then our savings % will go down too. Our Financial Agent is pushing to lock in an Annuity...but then no more liquid money like savings...At our age, as long as we are not losing money is a good thing.

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Looks like the YTD Dow has rebounded...
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Note Local and State Governments were a big part of the recent hiring numbers iirc ..

Some municipalities are looking very bad in terms of debt numbers.

That noted, I have NO Idea how that impacts local bonds .. just attempting to wrap my head around the large debt many have and how they can pay back the bills

 

[Sybertiger]

Not a big fan of 5 or 10 year investments in municipal bonds; long time to tie up money. With that said I do utilized other investments that do tie it up for a long time. Right now I've got MM funds which is pretty liquid and where I keep the bulk of uninvested monies. And it has dropped a full point in the last year. I do invest in trust deed projects that yield 10+ percent and those can tie up money for 1.5 year plus or minus. Also have a few investments are real estate private equity which can tie up money for 5 to 7 years but the returns are potentially 200 percent. Clearly the 10 - 200% investments have much more risk associated with them but probably less that gambling in the stock market.

 

[Sybertiger]

Not sure where we are now at but earlier this year Mortgage companies was rejecting around 20% of their loans which the article I read was saying that is higher than normal. I personally know 2 people selling at that time and went into contract and the buyers loans did not get approved.

I've noticed for many years a large part of the problem is that many people are biting off more than they can chew. For some reason many people feel the need to purchased the largest home they can get and still qualify. Sure, it's nice to have a fancy home but in reality do they really need to have that space. More power to them if they can afford it but I question the emotional decisions that people make because they feel the need to out-do others or the need to project themselves as more affluent than they really are. On top of it they then further burden themselves by spending monies on large TVs, new cars and fancy toys. It's really sad to see people self impose themselves into financial slavery. Personally, feel that 20% rejection is not high enough. Tired of seeing people in my neighborhood get into a home that they can barely afford but now cannot afford to maintain.

 

[bigredfish]

Been noticing Muni Bonds are holding above 5% and just recently the Gov't voted to keep them tax free still...

Savings is down to 4% but that has been going down from 5% starting most all of last year with the Feds dropping Interest rates. I am still ok with 4%, not long ago, Savings was at 0%

Mortgage rates have only slightly come down, not much to make any major difference. If Feds cut more then our savings % will go down too. Our Financial Agent is pushing to lock in an Annuity...but then no more liquid money like savings...At our age, as long as we are not losing money is a good thing.

View attachment 224420

Looks like the YTD Dow has rebounded...
View attachment 224425

Yep we're in the same situation. Double edge sword on rates depending on your priorities. I'd just as soon they stay high!

Still I'll be rolling over a 5% CD to 4.5% in 2 weeks and my brokerage account is still delivering 4.75-5%
We took a small hit on a MM checking account from 4 to 3.2% but we always knew that was going to fluctuate and its only 10% of our egg.

Glad we locked 25% on two 5 yr annuities through Athene (Well JPM acts as our agent)
One at guaranteed fixed 5.25 and one that pays 95% of the S&P % gain on the year. This is my only market exposure, but its not allowed to lose and you keep gains YoY regardless and its got a 1.5% guarantee

 

[bigredfish]

I've noticed for many years a large part of the problem is that many people are biting off more than they can chew. For some reason many people feel the need to purchased the largest home they can get and still qualify. Sure, it's nice to have a fancy home but in reality do they really need to have that space. More power to them if they can afford it but I question the emotional decisions that people make because they feel the need to out-do others or the need to project themselves as more affluent than they really are. On top of it they then further burden themselves by spending monies on large TVs, new cars and fancy toys. It's really sad to see people self impose themselves into financial slavery. Personally, feel that 20% rejection is not high enough. Tired of seeing people in my neighborhood get into a home that they can barely afford but now cannot afford to maintain.

This 1000%

We're quite happy at the swamp.
And talking to the guy who bought our house in 2022, taxes went from $2100 (our last bill) to $6400 in 3 years!

 

[David L]

Not a big fan of 5 or 10 year investments in municipal bonds; long time to tie up money. With that said I do utilized other investments that do tie it up for a long time. Right now I've got MM funds which is pretty liquid and where I keep the bulk of uninvested monies. And it has dropped a full point in the last year. I do invest in trust deed projects that yield 10+ percent and those can tie up money for 1.5 year plus or minus. Also have a few investments are real estate private equity which can tie up money for 5 to 7 years but the returns are potentially 200 percent. Clearly the 10 - 200% investments have much more risk associated with them but probably less that gambling in the stock market.

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Got the same MM

How I got these bonds was from my father when he passed away. One is still paying 7% but the other are 5%. But all of these Muni Bonds go out 20 years avg. When I first saw this I thought, no way, why would my father buy these. But after getting dividend checks sent to me all throughout the year I realized it was extra income for him since he was retired. Since they are tax free it did not mess with his taxes.

Here is what I found. These bonds are easily sold, especially when the Stock Market is doing bad, many people buy them then. I have already in the 4+ years of having these had some called back early, so you get all your money back, no loss. Some times I will just take the money, other times I bought new Bonds. I think these bonds are great for retired folks, brings in some extra tax free income which helps on a fixed income.

Most of these bonds are to build schools, court houses, etc.

These are individual Bonds, not a pool which is not recommended, that is by a couple of Financial advisers I consulted with told me. Like owning Individual stocks, I guess...

 

[David L]

I've noticed for many years a large part of the problem is that many people are biting off more than they can chew. For some reason many people feel the need to purchased the largest home they can get and still qualify. Sure, it's nice to have a fancy home but in reality do they really need to have that space. More power to them if they can afford it but I question the emotional decisions that people make because they feel the need to out-do others or the need to project themselves as more affluent than they really are. On top of it they then further burden themselves by spending monies on large TVs, new cars and fancy toys. It's really sad to see people self impose themselves into financial slavery. Personally, feel that 20% rejection is not high enough. Tired of seeing people in my neighborhood get into a home that they can barely afford but now cannot afford to maintain.

True, funny thing you have the extremes both ways, now with Tiny Homes a thing, which cost Way too much too...I guess it still holds true that 80% or more live in debt up to their eyeballs...

Not sure this still happens, guessing it does. Credit Card companies would setup booths at colleges approving any student that would walk up knowing their parents would bail them out. Talk about a scam...

 

[David L]

This 1000%

We're quite happy at the swamp.
And talking to the guy who bought our house in 2022, taxes went from $2100 (our last bill) to $6400 in 3 years!

Taxes was not the new owners problem of our house we sold last year. Home Owners Ins. for his mortgage shot up 40%, guessing more this year...so glad we moved when we did...