Fidelity shuts three money market funds to most new investors (way lower yields coming anyway)

[progree]

10. On inflation-adjustment ...

I've been sitting on the sidelines for some time, still a little nervous (not really 'nervous', just hesitant) in getting into the markets. I have been wanting to rebalance the majority of my stock holdings that I got from my Mom's estate (she passed), mainly because she was all over the map, had 5 shares of this, 10 shares of that, 2 shares of ABC, 1 share of DEF, etc. It's a mess, but the stock broker did say my Mom did a pretty good job of picking winners.

I inherited back in 2005, and my parents had about 5 accounts, and lots of stock holdings in small amounts like you describe. I happily cleaned house in 2008-2009 back when the market was way low, thus generating a lot of capital losses and reinvested it in a few of my existing mutual fund holdings and a few additional mutual funds and ETFs (all equity). Anyway a huge consolidation. I only have one individual stock holding now, the rest are in mutual funds and ETFs.

I've got too much egg on my face though to suggest what to do, because I made a big shift from equities to bond funds on March 30 when the S&P 500 was 2627 (it closed Friday at 2837, so far I'm "under water" on that manuver by 7.4%). This after 2 decades of preaching buy and hold, buy and hold, and practicing what I preached until now. The 2nd half of my OP above has more about this so-far not-so-good decision. But at the time there seemed to be no end to the Cov-19 doubling every few days trend and no Western countries showing any progress getting a handle on it (and I doubted and doubt that Western countries would take the drastic measures that some east Asian countries took -- i.e. real enforced quarantines in real isolation -- not this stay home and infect your family shit). Not to mention being led by a dementia-addled fuckhead pushing anti-malarial drugs and bleach- and ultraviolet light injections.

The other thing about market timing that makes it tough is that it's 2 decisions, not one. To beat a buy-and-hold equity investor, one must (#1#) sell at the right time and (#2#) buy at the right time. So when I made the decision to sell, I knew that, in order to make it work out better than buy-and-hold, I had to buy back in at a level below what I sold it at. That might not ever happen, given that the market is 7.4% above where I sold it at.

Still, I have 46% of my reasonably liquid investable assets in equities as of March 30 after the equity funds -> bond funds exchange, which isn't unreasonable for my age and anticipated life expectancy, according to the thumb rules out there.

By the way, just a question, I wonder what the graph would look like, overall, if a steady value of a currency was used, that is, the value of a dollar back in (an example only here) 1960 was $1. In 1970, it was .85 cents, etc. I am just asking if inflation is taken into account w/ these graphs?

The graph I showed is in plain old "greenbacks" aka "current dollars" aka "nominal dollars" -- there's no inflation adjustment. A graph like that will certainly look a lot less impressive if it's inflation-adjusted. I've seen them around, along with tables of returns, but I don't know where I saw these, so if I were to look, I'd have to do a Google search from scratch.

I often show this: the relative returns of 3 month treasury bills, bonds, and stocks.
http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html

It shows the yearly inflation rates and the annual REAL returns on the 4 assets in the last 5 columns (real return means inflation-adjusted return), but unfortunately doesn't show the cumulative returns (e.g. value of $100 invested at start of 1928) as it does for the non-inflation adjusted returns in the first several columns.

I think I've got this in a spreadsheet, so I suppose I could come up with cumulative inflation-adjusted returns.

What I do know is that stocks way out perform inflation in the long run. Whereas T-bills fall short. Bonds have trouble beating inflation but I don't know if they come out positive or negative on an inflation-adjusted basis over the long term.