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Dr. Frankenstein


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BONDS - ACTUALLY ITS WORSE

 

I forgot to take into account CPI of 3%.

 

The real return from 10 year US bonds is just 3.5% - 3% cpi

or a wonderful 0.5% per annum.

 

The reward after 10 years is a princely total return of 5%.

 

All inflation has to do is increase a little and you are giving your money to uncle sam for free.

 

And at the shorter end of the bond spectrum you are not only giving your money to Uncle Sam for free but paying him hansomly for the privilege of being able to lend it to him.

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