pabak, I'm figuring we'll get a 63 cent bump to the C fund tonight. EXACTLY 2 weeks ago today, the price of the C fund was at $7.86, and if my figure is right, it'll be at $9.57 tonight. That's a $1.71 gain in 2 weeks and demonstrates why you HAVE to have some $$ in the TSP stock funds.

That 2-week move in the C fund equates to 21.75%, which is important in that most bear market rallies stall out at 20%. The S&P busted through the 800 mark and is now sitting at almost 823. Remember in /m1442 I thought the chart pattern looked good for 825, then took a second look and thought maybe 875. If I had my TSP funds totally in stocks, I'd probably be pulling back, but I'm only around 30% due to the stupid "2 moves a month" rule.

If you read last night's comments by the TSPtalk guy, he's thinking the market is overbought, and the "dumb money" is indicating we might get a pullback. It's possible that today's news on the toxic assets could be a game changer, and we won't see the market drop back for a bit. Remember there's a LOT of money sitting on the sidelines, and if this starts to look like a rally off the bottom, they could jump in and the market would have some more nice gains.

Here's the chart for the S&P again - notice how it took off out of the gate, hugged the 800 mark for a couple of hours, then levitated at the end of the day - that's usually a sign that there will be "follow-through" tomorrow, but it wouldn't surprise me to see a pullback at some point (profit-taking, don't you know).

http://finance.yahoo.com/q/bc?s=^SPX&t=1d

I just took a look, and the 100-day moving average is around 843, and there is resistance at 850, and there was a double top at 875. The 200-day moving average is over 1,000 so I'm thinking we may not revisit that for a while. The question is "are you feeling lucky?"

It appears the market has legs now.The spin is that the market wants to go up.If you weren't in you missed it.Will the dow tank and retest the lows?Who knows.

If my quick calculations are correct, the C fund should come in at somewhere between $9.98 & $9.99/share tonight.

Considering that the C fund stood at $7.86 exactly one month ago, that jump of over $2.10/share is pretty significant. Just as TSP participants need to be mostly OUT of the stock funds during a down market, they need to be IN them when the market is going up. The problem is knowing when that is going to happen.

Remember the "climb the wall of worry" cliche.It seems like Mr. Market wants to go up even if the auto companies have big problems.So what if the deficit gets astronomical and China owns us.

bb, here's an article from AP commenting on the market run-up during April:

http://news.yahoo.com/s/ap/20090430/ap_on_...a_re/us_wall_street

Recall a few weeks back when I thought the S&P chart could be forming an inverted head & shoulders with a move to 875 ( /m1442 ). The market has now gotten to that level, and another look at the chart:

http://stockcharts.com/charts/gallery.html?$SPX

shows that there is the possibility of a move to the 925-940 level on the S&P (with a slim chance of hitting 1000). If you've been reading the TSPtalk commentary, he feels that the market is pretty overextended, and due for a fall. Several of the indicators he follows are flashing warnings to that effect. Then too, the market is typically lackadaisical during the early Summer months. My gut feeling (subject to change) is that we'll get a pullback at some point, but keep going up. As barebull pointed out, when the market continues to go up when the news is bad, it is USUALLY looking beyond the bad news. For instance, the news that the 1st quarter GDP was down something like 6% didn't seem to faze Mr. Market. That said, I did take some of my TSP $$$ out of the stock funds in case we do get a pullback.

I think if you are not already in it would be very risky to go in very much now.It looks like the low was around March 6.I know some stocks around that time have tripled or more since then.

Futures are down a bit this morning. Be sure to read the TSPtalk site. Looks as if we might be getting the long-anticipated "correction" to the huge move up in the market...

Big Time Changes In Your TSP

June 1, 2009 - 9:42am
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Would you like the option of having a tax-free Roth IRA option in your federal 401(k) plan? That way you could invest after-tax money into the stock, bond or unique Treasury funds and not have to pay any more taxes, no matter how big your account grew, when you started withdrawing the interest and earnings.

Would you like to have the one-time chance to move some of your Thrift Savings Plan account funds into an outside mutual fund while maintaining its tax-deferred status? If you've always thought you could do better investing outside the conservative TSP, say putting your money into a gold, real estate (REIT) or sector fund (like South Korea or exclusive health care stocks), this would be your chance to do it.

Wouldn't it be nice of your surviving spouse could "inherit" your investment account and keep it in the TSP rather than being forced to take a distribution? That way he or she could keep money in the TSP, with its lowest-in-the-business-fees, and its options which include tailored target funds (the L-funds) that rebalance daily.

All of the potential TSP changes, plus several other pro-federal worker perqs, are wrapped inside the so-called Tobacco bill. The House has passed it and the Senate is scheduled to begin debate tomorrow or Wednesday. The pro-fed changes are not particularly controversial (although the administration could object to some on cost grounds), but the bill would give FDA more control (critics say a strangle-hold) on tobacco.

Like it or not, tobacco is a major, if not the major, cash crop in many southern and some northern states. Attempts to cut consumption by the imposition of heavy state taxes has dramatically increased the smuggling traffic, especially into the New York City area. Officials say the revenue lost is significant.

pabak, the TSP adding a Roth option would be very cool. I wish they would have had some way of investing in gold back when the price was below $300/ounce (now close to $1,000).

With all the hoo-hah at USPS HQ over it $$BILLIONS they've lost mostly as a result of poor management, it wouldn't surprise me to see them go after things like our COLA, salary, insurance & possibly matching TSP funds.

As long as they continue a 5% match, I'd say that option is better than a Roth (provided there's no match for that account), but anything over 5%, I'd lean toward putting that in a Roth should this bill pass.

According to my quickie calculations, the C Fund should come in tonight at $11.02-11.03. That would be the C Fund's first finish over $11 since early November of last year.

If you've been following the TSPtalk guy, he's been pretty skeptical that this rally would continue. On this thread back several weeks ( /m1449 /m1442 ), I've been saying this looks like an inverted head & shoulders, or a v-bottom. I thought the 940 area on the S&P might complete the H&S, but I believe we still MAY see 1,000 on this move up. By every measure, this move has been VERY powerful, and quite rapid. I think many people were gun-shy, and weren't thinking about the TRILLIONS of $$ that the government has been pouring into the economy (which could at some point lead to big-time inflation - witness the snap-back in oil prices lately).

Anyhow, TODAY I heard several commentators saying the economy has turned the corner - well, DUH! Where were they as the market rose steadily over the last 2 months? To be fair, it is said that the market anticipates a recovery by 3-6 months, so it may be a while before things turn around in the real world, though we are seeing a few signs (consumer confidence, home sales, etc) right now that might be hinting at a turn around.

It may be that Mr. Market has been waiting until everyone breathes a sigh of relief before he gives us that big, scary correction, so watch carefully, but enjoy your TSP gains if you stayed or switched into the stock funds - my TSP account has FINALLY passed by about $3,000 where it stood last September - so maybe I'll be able to retire sometime after all!!

Cheers.

Including the C fund close on June 1st at $11.03 (as predicted), the C fund has hit the $11.03 mark 3 times & $11.05 once in 7 trading days so far this month. Those figures pretty much equate to the 940-945 level I thought could be pretty sticky on the S&P 500. Things are feeling a little toppy here, but that won't stop a bull run IF that's what we're in. I think the odds are against it, but you have to consider it. If you've been reading the TSPtalk guy, he continues to think we're about to head back down for a bit. On his side, the market technicals look weak, we're in a period of time that has typically been weak for the market, and the market has rebounded from a LONG way down without much of a pullback. On the plus side, we're getting a lot of "clues" that the economy MAY be starting to make a comeback, and some pretty good news on the financial front. However, part of the market jump can be tied to a DOUBLING in the price of oil over the last few months. So there's lots of data to consider. I have to say that IF I had a lot of my TSP money in the stock funds during this market run-up, I'd be looking to play it safe with some of those gains. Back when the market was WAAAAAAAAY down, I had to try to keep myself from screaming BUY! on this board. It was really a no-brainer. From here on out, though, it will probably be a whole lot dicier. So, read all you can, do some strategizing, consider your OWN personal situation, and act accordingly.

Good luck!

Futures are up early this morning, over 100 on the Dow right now. IF we get follow-through when the market opens, it might put us above the resistance we've encountered several times at this level. That would imply a move higher. We should know soon.

Quick note - I noticed that the TSP has NOT added this week's contribution yet. They usually do this on Wednesday night, so they are late, but I haven't heard anything.

Edited by author 06-12-2009 10:50 PM
Changes coming to TSP plan

The tobacco bill which passed today contained provisions allowing changes to the TSP plan. One of the changes is the okay of a Roth IRA TSP account, but this article says it may take 1-2 years before it's done, and it would benefit people whose retirement income is higher than their working income. Also, the FERS sick leave provision got dropped from this bill:

http://federaltimes.com/index.php?S=4137138

In surfing various postal sites tonight, I've seen several messages from people who noticed that their TSP contributions for this pay period have NOT been credited to their accounts as I noted this morning.

One person said they contacted a TSP rep, was told there was a "glitch", and the funds would go in next week (I think they said Jun 16).

With the USPS bemoaning their shortage of $$$, the first thought that came to my mind this morning, was "UH OH!"

In checking my TSP account today, I noticed that this pay's contribution has now been credited.

I'd like to hear what exactly happened.