Sitting tight? 按兵不动

Reader question:

Please explain “sitting tight”, as in this sentence: I think 40,000 yuan per square meter for a one-bedroom apartment is pricey, so I’ll sitting tight for now.

My comments:

The speaker is waiting for housing prices to drop further so that he or she can make an investment on a one-bedroom apartment. Right now, prices are still high, so they plan to hold on to their money a little longer.

Hold their money firmly, that is, never letting go.

That’s what “tight” in “sitting tight” implies, meaning firm and fast.

Firm, yes, but fast?

Fast, yes, as in fast asleep.

Okay.

Sitting, of course, refers to resting on the buttocks or haunches.

“Sitting tight” may have been inspired by hatching birds sitting patiently on their eggs. Hence the idiom “sitting duck”, for example, an immovable and therefore easy target.

Hence and therefore, figuratively, if we decide to sit tight for the moment, we plan to wait and take no action. We want to remain quiet for the time being.

All clear?

All right, here are media examples of “sitting tight”:

1. President Joe Biden announced Wednesday that the administration would cancel $10,000 in federal student loans for most borrowers, fulfilling his campaign promise to bring student loan debt relief to millions of Americans.

The plan is limited to borrowers making less than $125,000 per year for individuals and less than $250,000 for married couples or heads of households. Pell Grant recipients who meet the income threshold are also included in the plan and can receive up to $20,000 in relief. Private loan holders are not eligible for relief.

Although the announcement noted that an application for borrowers to apply for the program would be available “in the coming weeks,” there’s been little information on how borrowers can determine if they’re eligible for the debt relief and what the application will entail.

Nearly 8 million borrowers for whom the Department of Education has income information available, however, should be eligible to receive debt relief automatically, according to the announcement.

...

Implementing a broad student loan forgiveness plan is going to be a “slow process” that requires “a lot of communication between the Department of Education and loan servicers,” Michelle Dimino, a senior education policy leader at public policy group Third Way, tells CNBC Make It. “[Most] borrowers won’t automatically see their balances be cleared or reduced … we’re all sitting tight for more information.”

The administration’s broader debt forgiveness plan is “incredibly problematic and confusing to borrowers” as it stands now, Scott Buchanan, executive director of the Student Loan Servicing Alliance, says, but he’s optimistic that the details of the application process get “ironed out” and become “much clearer” in the coming weeks.

“Education is a ticket to a better life. … but over time that ticket has become too expensive for too many Americans,” Biden said during a speech from the White House hours after the announcement. “All this means that an entire generation is now saddled with unsustainable debt in exchange for an attempt at least at a college degree. The burden is so heavy that even if you graduate you may not have access to the middle-class life that the college degree once provided.”

- How to check if you qualify for Biden’s new student loan forgiveness plan, CNBC.com, August 24, 2022.

2. US households are burning through their pandemic-era savings like no one else.

Having put aside a record $2.6 trillion in so-called excess savings (that’s money that would’ve otherwise been spent), the pile has almost halved to $1.4 trillion as consumers spend big on services such as travel and leisure, according to research from Citigroup.

But that largesse isn’t on display in America’s peers, where households are sitting tight. Excess savings rates in Europe, Japan and the UK stand broadly unchanged from the peaks they hit during the pandemic, even though, like the US, those places have all suffered through an inflation crisis. In those places, like the US, much of the extra wealth was accumulated as governments supported their economies through massive aid packages. That support for households lifted excess savings by a factor of two or more – peaking at almost 6% of gross domestic product – according to the Federal Reserve.

One reason US households are running down these savings at a faster clip is that their run-up in wealth far outpaced other advanced economies to begin with, leaving them with more to spend, according to Robert Sockin, senior global economist at Citigroup. Other differences may reflect that US savings are in more liquid assets and that US consumers remain confident in their outlook for stock prices and the broader economy.

Although retail sales rose by less than forecast in June and hint at a slowing consumer, an underlying measure of household spending that excludes sectors such as auto dealers and building materials stores pointed to plenty of cash going out the door at the end of the second quarter. Sales increased in seven out of 13 retail categories last month, including advances at nonstore retailers, electronics stores and furniture outlets.

To be sure, estimates on US excess savings vary, mostly due to the different methods of calculation. Analysis by the Federal Reserve in June, for example, found that US households had mostly run down their excess holdings and that other advanced economies are doing likewise. Others also estimate that US households have mostly tapped out their pandemic-era golden goose.

Still, Sockin argues that the savings cushion remains an underappreciated fact as to why the US continues to defy calls of a recession. “People keep underestimating how much people are willing to draw down on these savings to spend particularly on services,” he says.

- America’s Piggybank Is Empty, Bloomberg.com, July 18, 2023.

3. Billionaire investor Charlie Munger, vice-chairman of Berkshire Hathaway and long-time friend to Warren Buffett, died on Tuesday. He was 99 years old.

Munger was known for his quick wit, life-long passion for learning and old-school approach to investing. Munger leaves behind a colossal legacy that extends from Wall Street to Main Street.

“His impact went far beyond the investing world. People discovered him, thinking that they would learn about ways to make money, but they got so much more,” Whitney Tilson, an investor and expert on both Buffett and Munger, told Before the Bell. “He talked about a latticework of how an intelligent person needs to read and study a wide range of subjects. He said ‘if all you have is a hammer, the world looks like a nail.’”

Munger, who was worth $2.7 billion according to Forbes, was revered for his pithy and often humorous remarks on investing, life and more. He often employed what Tilson calls Munger-isms to simply convey very complex concepts.

His speeches and writings, compiled in books like “Poor Charlie’s Almanack,” are considered essential reading for anyone interested in business, investing or the art of clear thinking.

Here are some of his most memorable musings.

…

On learning:

“I constantly see people rise in life who are not the smartest, sometimes not even the most diligent, but they are learning machines. They go to bed every night a little wiser than when they got up and boy does that help—particularly when you have a long run ahead of you.” – 2007 USC Law School Commencement Address

On sitting tight:

“There are huge advantages for an individual to get into a position where you make a few great investments and just sit on your a**: You are paying less to brokers. You are listening to less nonsense. And if it works, the governmental tax system gives you an extra 1, 2 or 3 percentage points per annum compounded.” – Worldly Wisdom by Charlie Munger 1995-1998

- Charlie Munger’s best quotes on investing, life and everything in between, CNN.com, November 29, 2023.

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About the author:

Zhang Xin is Trainer at chinadaily.com.cn. He has been with China Daily since 1988, when he graduated from Beijing Foreign Studies University. Write him at: zhangxin@chinadaily.com.cn, or raise a question for potential use in a future column.

（作者：张欣  编辑：丹妮）