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Pastimes : Clown-Free Zone... sorry, no clowns allowed

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To: Perspective who wrote (225174)3/4/2003 10:30:01 AM
From: reaper  Read Replies (1) of 436258
 
<<that I'm losing effective purchasing power by holding a treasury bond>>

maybe true for BILLS (short term), but not bonds. despite my wife's taste for expensive imports (which she's passing on to our daughter <g>), the capital gains plus the rate on zero bonds is vastly surpassing even the Guru's imagined inflation.

as a general rule, you do not DESERVE a real RETURN for holding the risk-free asset (short term government paper), especially in a deflationary environment awash in excess capacity. you deserve to have your purchasing power more or less maintained, which is +/- the case today.

Cheers
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