Originally Posted by lsbcal
Bosco, since you are vulnerable to inflation I'd think in the fixed income area you would want to have plenty of TIPS when real rates get up to more normal historic levels. Just a thought.
I am very leery of US-denominated bonds, since I need to spend the returns in Canada. Given the massive debt and fiscal irresponsibility of the US government, I am unwilling to risk very much of the portfolio on any fixed-income instruments denominated in US dollars. The currency just doesn't seem very stable to me vis-a-vis a resource-based economy like Canada's. In addition, I have significant US-denominated pension income which causes me to be highly exposed to currency risk as it is.
However, Canada has a TIPS equivalent, and I do have some of those in my allocation, as well as international and emerging market bonds.
If there is a flaw in my thinking--I'm all ears.....