April 2022, Chicken Little Portfolio Performance

The Piper will be paid (by us, not Jay Powell).

The bull market in everything was fueled by government overspending and Federal Reserve looseness. Stocks up, Bonds up, housing up, gold up, crypto up. Now, the Fed has decided that it is their best interest to end the party, and everyone else will have to pay

The Fed made a mess, and we all have to pay

This time is not different, just delayed?

What is the outcome of massive government overspending financed by loose money? The answer is stagflation, depression, and disaster. The only mystery in this current situation is why it took so long for the disaster to emerge.  

Regardless of the reasons for delay, the negative consequences seem to be here.  The likely outcome is a persistent rise in real interest rates, and a consequent continued decline in asset prices. Returning rates and asset prices to something more rational will result in pain for borrowers and higher rates of return for savers.  

April 2022 performance
The Dow Jones Industrial Average lost 4.92% in April 2022 while the Chicken Little portfolio lost 0.35%. Year to date, Chicken Little has lost 1.37%, while the Dow has lost almost 9%

Apr 2022YTD 2022
Chicken Little-0.35%-1.37%
Dow Jones Industrials-4.92%-8.83%

April 2022 was a negative month for most assets. Long term US treasuries lost over 9%!  Stocks markets around the world fell between 5% and 10% in the month. Year to day, gold remains the only winner. 

AssetSymbolApr 2022YTD 2022
Dow Jones IndustrialsDIA-4.92%-8.83%
Non-US StocksEFA-6.74%-12.76%
Emerging Market StocksEEM-6.14%-13.24%
US Long-Term BondsTLT-9.25%-19.00%

May 2022 portfolio position

The Chicken Little Portfolio remains prepared for financial disaster. 93% of the portfolio is in cash or relatively short-term US Treasuries. Two trades were made in April. 1) The portfolio shed its small crypto position. 2) On, April 18, 2022, I reduced the size of the short stock position

As a saver, with a lot of cash, the rise in interest rates is great. Consequently, I can reduce risk even further in the portfolio. 

Chicken LittleDow Jones Industrials
2022 (through April)-1.37%-8.83%
2015 (April through Dec)-2.49%-0.27%
since inception (3/31/15)23.68%113.85%

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