Joined: 09/12/2020(UTC)
Posts: 2,081
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Thrugelmir;332278 wrote:ANDREW FOSTER;332275 wrote:ben ski;332270 wrote:ANDREW FOSTER;332251 wrote:ben ski;332236 wrote:I would note we've just had a phase (2022), where valuations mattered – in bonds. I'm skeptical of people who claim to have sold out of bonds just before the crash – only because, if you were looking at yields, you'd have sold out in 2014/15 ... And it didn't matter being 8 years too early, because you'd have done well in almost anything (with rates that low – everything rises).
Personally I sold out of bonds before the crash. I made comments to this effect in the transactions thread and the reasoning behind it. It wasn't based on yields at the time it was based on forecasts of inflation and rate rises. Which were the canary in the mine for anyone willing to listen. I didn't have bonds in 2014/15, as I was still in accumulation and 100% equities. What is there to be skeptical about? Skeptical about every aspect of that decision. If you say it was on rate and inflation forecasts, they were forecasts to rise every year from 2009 to 2020. So why not any of those years? They also didn't call 2022, until rates were already moving. So if you'd sold out in 2021 or early 2022, those were about the only times in a decade the indicators wouldn't have told you to. It just doesn't add up. Even that you'd use forecasts as a timing tool, as we know they're always wrong. Why you'd start buying bonds between 2014 and 2022, when they offered no value. No, base rate and infaltion rates were NOT forecast to rise every year between 2009 and 2020, that's just rot. A reminder of historical events......... 2018 appeared as if normality would return slowly. Then Covid stepped in. Then the Ukraine war. 07 Nov 24 4.75 01 Aug 24 5.00 03 Aug 23 5.25 22 Jun 23 5.00 11 May 23 4.50 23 Mar 23 4.25 02 Feb 23 4.00 15 Dec 22 3.50 03 Nov 22 3.00 22 Sep 22 2.25 04 Aug 22 1.75 16 Jun 22 1.25 05 May 22 1.00 17 Mar 22 0.75 03 Feb 22 0.50 16 Dec 21 0.25 19 Mar 20 0.10 11 Mar 20 0.25 02 Aug 18 0.75 02 Nov 17 0.50 04 Aug 16 0.25 05 Mar 09 0.50 05 Feb 09 1.00 08 Jan 09 1.50 04 Dec 08 2.00 06 Nov 08 3.00 08 Oct 08 4.50 10 Apr 08 5.00 07 Feb 08 5.25 06 Dec 07 5.50 05 Jul 07 5.75 I still remember so called "experts" predicting negative interest rates in sovereign bonds, before and during covid. The future is incredibly hard to forecast, but we can all make sensible decisions based on current information. But for the naive, it is easy to fall in the trap of misinformation as seems to be spouted so much by many sources.
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