Is your investment guru your brother-in-law who lives in a trailer in your backyard, a screaming cable news expert or a financial writer from The New York Times or Wall Street Journal, who is 80% accurate 40% of the time?

So, do you want/need closer-to-home, probably much more realistic, guidance? If so, look at your own Thrift Savings Plan account, and the allocations favored by your 5,690,000 fellow account holders who are active, retired or former federal workers or military personnel. Not all of them are rocket scientists — although many are.

But your co-investors also include diplomats, top soldiers, cancer researchers, foreign affairs experts, urban postal clerks and rural letter carriers, agriculture experts, and cancer researchers. They arguably are the largest, best educated group in the nation. They live and work in every community around the U.S., as well as in more than 150 foreign countries. They are liberal and conservative, Republicans and Democrats, Socialists and Tea Party members. So what they know, think they know and how they feel and what they might do might be worth considering.

By now, even the most out-of-touch people know that we are (hopefully still) in the longest bull market in history. It’s been running since March 9, 2009. Normally there is a correction of 20% or more every three-and-a-half years. But that’s an average, not a yardstick. So are we overdue? Almost certainly, but when? That’s a bit tougher.

Many “experts” believe the recession is just around the corner. Some think it has already started, and that the trade wars are the problem. Or maybe the banks, again, are the problem, or bond yields are the problem , or that Donald Trump, Bernie Sanders, climate change or that Denmark-owning-Greenland is the problem? Whatever …

During the Great Recession of 2008-2009 tens of thousands of federal workers and retirees saw stock prices dropping. So they sold their C, S and I funds and put them into the “safety” of the treasury securities G fund. And they bought G fund shares every two weeks even as the stock-indexed funds were, we now know, on sale. Many never returned to stock even though the market(s) even with their ups and downs, are still up big time for the year.

As of June there were 3.4 million workers under the “new” Federal Employees Retirement System with TSP accounts. Their average balance was $145,474. More than half a million also had Roth accounts averaging $14,198.

There were 306,459 Civil Service Retirement System workers and retirees with TSP accounts averaging $154,091. Just over 10,000 also had Roth accounts with an average balance of $21,817.

Over 1.8 million members of the military, the majority of whom are not “lifers,” have TSP accounts. Depending on their retirement plan their average balances ranged from $27,000-$114,000.

Feds, in many respects, are “typical” Americans on steroids. They are the financial foundation of many communities which depend on federal hospitals, prisons, military bases, postal distribution or IRS service centers — or better for the local economy, all of them. During the last recession many people lost their jobs. Many took voluntary pay cuts ranging from 5%-25% to keep their employers afloat. No feds lost their jobs or a paycheck because of the recession.

Because of their guaranteed employer retirement benefit feds, especially those under the cradle-to-grave CSRS program, can be bolder investors. Many of them are.

So when does the next recession start, and how long will it last? Should you retreat to safety, or consider it a one, two or even three-year buying opportunity?

Check with the experts, starting with that person staring back at you in the mirror.

Nearly Useless Factoid

By Amelia Brust

Beginning in the 1980s Don and Kim Epperly or Roanoke, Virginia, constructed a miniature replica of Elivis Presley’s Graceland estate near their home as an homage to the King. The couple started Miniature Graceland with the main house and later constructed other buildings including concert halls where Elvis performed, as well as the Elvis Presley Car Museum. The site is now a popular roadsite attraction. The Salem Garden Club took over management of the site after the Epperly’s no longer could, but a golden statue of Elvis in the front yard welcomes visitors to offer donations to keep Miniature Graceland alive.

Source: Atlas Obscura

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