- •
Bay Area housing faces multi-year correction
“I would be worried about a potential drop in Bay Area real estate. I think there was a kind of AI resurgence that started near the end of last year and into this year, and I think that kind of held the Bay Area economy together. But if you start to see some sort of reduction in interest around big tech, and obviously the business of big tech is suddenly becoming very capital intensive, does that mean less room for stock options for employees? I think that could be a big factor and you're entering probably 2026 where prices broadly will come down.”
- •
Limit bond exposure for younger investors
“The fact that you're in your 30s, that's a far too conservative portfolio, 50 percent in bonds, maybe even more in corporates. For cash-like holdings, I'm okay with treasuries as a cash alternative, but as a longer-term investment, you don't want to be in treasuries, especially any long-duration treasuries. Your main bond exposure should be in corporates and it shouldn't be a large percentage of your portfolio; it should be probably sub 20 percent.”
- •
Bitcoin acts as a global liquidity proxy
“If you look at the correlation of Bitcoin and what it tends to correlate to, it's mainly a liquidity proxy along with a proxy for tech stocks. It's viewed as kind of a fringe asset to the traditional financial system and it's furthest away from your consumer staples or dividend paying stocks. When liquidity starts to dry up, these are the places where capital is pulled out from first, and that's why it tends to languish and be correlated with liquidity.”
- •
Three-bucket strategies reduce sequence return risk
“The three-bucket retirement strategy is a way to smooth withdrawals by segregating assets into three different buckets. Bucket one is short-term needs like cash and T-bills to help fund living expenses and avoid selling investments during a downturn. Bucket two provides medium-term income through intermediate bonds and dividends, while bucket three is the long-term growth engine to help outpace inflation and refill the other buckets over time.”
- •
Prefer short-term CDs for better liquidity
“I would probably go somewhere in the year to 18 month level for CDs so that you're able to refinance or reinvest and get liquidity. You're not missing out on a whole lot of yield compared to a four-year CD versus an 18-month or two-year CD. That is the way I would be thinking about it: how much are you willing to give up for that liquidity? I'd be willing to give up a decent amount of yield to get that.”