"I cannot remember a time like this . So I believe the traditional retirement mix 60/40 on stocks /bonds is just gonna go out the window given the current spread"
Sounds a little bit like something one would here in a bubble... :-)
Although I agree in practice, especially regarding the bond part – bonds are generally a way worse investment vehicle since you've literally limited your returns on the upside, but not on the downside (the opposite of what I like to do) – I'd rather own something else that has the same function as bonds in the stocks/bonds mix. More so than every now than bonds are so mind-bogglingly low-yielding. (That's what you get when you give people free money...) Right now, electricity looks extremely cheap, at least in Sweden, for example.
I still think most investors should follow Ben Graham's advice: when markets are obscenely overvalued: 25 % stocks, 75 % bonds (or bond ecquivalents); when they are absurdly undervalued, the opposite. If you really know what you're looking for, however, there's always some value to find. Special situations are always going to be around, etc. etc.
Respectfully,
petal
P.S. Anyone have an idea on how a small time player can buy something similar to a CDS, or imitate one? I want to be able to do what Burry did in '05 and what Ackman did in March... I want to short the US bond market :( |
