Post #3963 by WendyBG on the Macroeconomic Trends & Risks board

Personal Finance / Macroeconomic Trends & Risks

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I have avoided the cap-weighted SPX index because it is overloaded with bubble AI stocks. I have a minor allocation (about 10%) in dividend-yielding stocks and SCHD even though the entire market will be dragged down when the bubble pops as the baby will be thrown out with the bathwater.

I have a substantial amount of inflation-adjusted bonds (TIPS and I-Bonds). These are part of a bond ladder which I hold to maturity. I'm not adding maturities over 10 years because even inflation-adjusted bonds (except I-Bonds) decline in value when interest rates rise. I anticipate a bear steepening of the yield curve due to huge government deficits.

I am holding cash in the form of short-term secondary market CDs which yield more than money market funds and are FDIC-insured.

Wendy

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