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Re: Treasury Bonds, help with basics...
Old 07-08-2005, 11:31 PM   #61
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Re: Treasury Bonds, help with basics...

It seems that math is even odder that ()!
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Re: Treasury Bonds, help with basics...
Old 07-10-2005, 01:19 PM   #62
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Re: Treasury Bonds, help with basics...

Quote:
Originally Posted by OldAgePensioner
Wabmester,
As I return to work, do you feel bonds are required in a portfolio while the individual has no desire for additional income?
For gosh's sake, listen to the man.

Bonds serve to reduce volatility in a portfolio as well as to provide diversification. Oh, yeah, there's income too, but that can be reinvested or used to balance an asset allocation. IMO income is not a primary reason for a bond's existence any more than dividends are a primary reason to buy a stock.

Based on your previous posts, [jack nicholson]you can't handle the volatility.[/jn]
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Recent deflation
Old 01-08-2010, 11:17 PM   #63
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Recent deflation

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I believe that the last period of deflation of any note was the Great Depression. Maybe there was a brief period in the late 40s early 50s, when there was a pretty severe recession, but obviously it didn't last long.
Deflation of any note! How about 2009 compared to 2008, at least according to CPI. That is why not SS increase in 2010 because of the CPI decrease which would have resulted in a reduction except the SS rules is that the CPI adjustment to SS is never negative. Some of my inflation protected Series I savings bonds, went from 6% to 0% for 6 months which had a rate of 3% + CPI for each 6 months. Since 6 mo. CPI increase was -5%, that added to 3% was a negative number. However that also was controlled to 0% minimum.

How did it happen? Well 2008 had an energy cost bubble (think gasoline over $4, crude over $100/barrel) that went away in 2009, and there were rent reductions in 2009 according to the Department of Labor. The CPI used is technically CPI-U which is supposedly the cost of a typical urban worker's expenses. If interested, go to the Bureau of Labor Statistics, it is quite technical.

This may not meet the definition "of any note", but according to CPI figures these things happen. Actually, in the 6 month period ending in November 2009 inflation is again positive and my Series I bonds are now, or soon will be positive, and new Series I savings bonds pay more than bank CDs.

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Old 01-09-2010, 07:45 AM   #64
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Quote:
Originally Posted by zzyp View Post
Deflation of any note! How about 2009 compared to 2008, at least according to CPI. That is why not SS increase in 2010 because of the CPI decrease which would have resulted in a reduction except the SS rules is that the CPI adjustment to SS is never negative. Some of my inflation protected Series I savings bonds, went from 6% to 0% for 6 months which had a rate of 3% + CPI for each 6 months. Since 6 mo. CPI increase was -5%, that added to 3% was a negative number. However that also was controlled to 0% minimum.

How did it happen? Well 2008 had an energy cost bubble (think gasoline over $4, crude over $100/barrel) that went away in 2009, and there were rent reductions in 2009 according to the Department of Labor. The CPI used is technically CPI-U which is supposedly the cost of a typical urban worker's expenses. If interested, go to the Bureau of Labor Statistics, it is quite technical.

This may not meet the definition "of any note", but according to CPI figures these things happen. Actually, in the 6 month period ending in November 2009 inflation is again positive and my Series I bonds are now, or soon will be positive, and new Series I savings bonds pay more than bank CDs.

-zzyp-
You are dredging up a thread from 2005? Sheesh.

In any case, as expected with the treat of deflation the pump was primed with monetary policy and fiscal stimulus so deflation was very brief and is now in the rearview mirror. Meanwhile there were great deals available on TIPS in early 2009. Hope you grabbed some...
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Old 01-09-2010, 08:55 AM   #65
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Quote:
Originally Posted by brewer12345 View Post
You are dredging up a thread from 2005? Sheesh.

In any case, as expected with the treat of deflation the pump was primed with monetary policy and fiscal stimulus so deflation was very brief and is now in the rearview mirror. Meanwhile there were great deals available on TIPS in early 2009. Hope you grabbed some...
TIPs, corporates, and junk were all priced for disaster. Glad I bought some.

Of course, I'm not a DMT...
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Old 01-15-2010, 07:49 PM   #66
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Quote:
Originally Posted by brewer12345 View Post
You are dredging up a thread from 2005? Sheesh.

In any case, as expected with the treat of deflation the pump was primed with monetary policy and fiscal stimulus so deflation was very brief and is now in the rearview mirror. Meanwhile there were great deals available on TIPS in early 2009. Hope you grabbed some...
Sorry about old message, was looking for something else using key word search, ran across your message and though it needed reply, only noticed later the date.

I didn't have funds available then much, and still did not fully understand the longer term advantages of tips. So, I did miss out. I suppose when I was selling i bonds with 1% or less fixed (paying 0%) after May of '09, that I should have bought TIPs instead of CDs.
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