mickeyd
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Scott Burns does a pretty good job of getting down to the nitty-gritty of our current bond yield/inflation dilemma in this response to an email. Somethings gotta give.
Investor Beware: Yields Are Lower Than the Inflation Rate - Registered Investment Advisor
The Vanguard Total Bond Index fund, which is an intermediate maturity fund, currently yields about 3.39 percent for the Admiral shares. Admiral shares are available for those who invest more than $10,000. That 3.39 percent is significantly short of the 4 percent yield you want.
In other words, the rate of inflation currently exceeds the yield on this major fund. Historically, the real return on intermediate-term government bonds was about 2 percent. They provided a yield that exceeded inflation by 2 percentage points.
Investor Beware: Yields Are Lower Than the Inflation Rate - Registered Investment Advisor