Jim,
Thanks for the info on the bonds. What I probably meant to say was a CD. My focus is on stocks, and I kept a good percentage of cash from 2002 to 2004 since there seemed there was no good liquid alternative worth anything back then. I don’t really know about the various alternatives to the markets like bonds, but with rates rising, it’d probably be a good time to learn, I like Rankandfile’s suggestion to have a thread devoted to investing in cash.
So do you think it’d be better to put money in a CD as a safe storage place?
Powayseller,
I’d have agreed with you a couple of years back when everything did seem to be overpriced, but I think there are some good values out there now. In fact, my last purchase was COP as well. My only concern is for a deep recession that would affect the E part of the P/E ratio. I think that by going to 95% cash, you’re speculating on a market that can do some weird things, that’s why I only want to take half off the table. To be honest though, I don’t think you’ll be missing out on any major market rally IMHO, but I’m just as afraid of being completely out of the market and missing out on say four years of gains because I tried to predict that the market would tank.
Like you, I’m happy with the 5.5% a CD pays right now with what I take off the table.
So it seems that everybody believes there’ll be a recession soon (as Powayseller pointed out, they are a natural part of the market) Any bets on when the recession will start, and how bad it’ll be?
