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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Freedom Fighter who wrote (63130)	6/24/1999 9:46:00 AM
From: valueminded	Read Replies (2) \| Respond to of 132070

Wayne: No doubt a real yield above inflation would be attractive at 5% but I do not believe that inflation is 2% nor do I believe it will stay at 2%. Our historic bias is inflationary, and I do not see that changing in a democratic society. Now I am not predicting failure of our democracy nor our fiat money system, but someone famous (and I forget who) said that the biggest problem facing democractic societies is fiscal. Once people realize they can vote themselves more money, their is no stopping it. (I would add for democratic societies which are decoupled from a reserve based system) This is why a dollar today is worth more than a dollar tomorrow, it is also one of the biggest difficulties most value investors face. Maybe it is simply put this way, giving the history of this FED, when faced with todays potential inflationary or deflationary environment which way will they err ? My opinion is that they will err on the side of loose money.

To: Freedom Fighter who wrote (63130)	6/24/1999 10:56:00 AM
From: Joan Osland Graffius	Read Replies (1) \| Respond to of 132070

Wayne, I am easing into 30 year bonds at the moment. I am not buying zeros at this time since I could be a longer term hold of this instrument than I expect. The income while I am waiting could be useful. I have been trying to figure out what can go wrong with the strategy and of course commodity inflation could make the bond rise in price. If this starts get going I will hedge the position in stocks where inflation starts to become evident. Do you have any other ideas with this game? Joan