Posted on 12/12/2008 11:51:18 PM PST by TigerLikesRooster
“To receive zero percent interest after loaning your money to the government for one month is ridiculous.”
And yet millions of people do this yearly, GIVING Uncle Sam their hard earned cash while salivating over a ‘tax refund’ at the end of the year and planning a vacation somewhere warm with their own, returned, ‘worth-less’ cash! *Rolleyes*
When I was in the military, we were CONSTANTLY bombarded to buy Savings Bonds directly from our paychecks each month. No, thanks! Even way back when my money was working harder for me than a Savings Bond ever could.
How sad to practically FORCE military members to support the Government with their hard-earned dollars!
Check out The Vice Fund, first link on the left. One of my favorites to recommend to contrarian investors like me.
The last thing people give up in hard times are liquor, lottery tickets and cigarettes. The last thing the Government usually cuts is defense. Well, with THIS upcoming administration, I’m not to sure about that, but the other ‘vices’ will make up for any loses there.
People will definitely be drinking more if they lose all of their money, and we all know how much our new President just LOVES his Kools, LOL! :)
I’m with you, 100%. Our gold & silver have quadrupled in 10 years’ time. Dad & I invested out inheritance from Grandpa, and he’s smiling down on us right now, I’m bettin’! :)
vfiix
WHAT?
My Bond fund lost as much as my equities fund. Can you explain that one?
How 'bout that? Your own mini hedge fund!!!!!
I’m confused. Is this really a “bubble?” I think it is more of a flight to safety without a particular expectation of financial growth. For example, I had my broker move all my 401K out of mutual funds and into treasury back securities the day before the election. I really didn’t care what the return would be, so long as the face value didn’t crash and was backed by “the full faith and credit” of government. (Whatever that means with a Marxist at the helm.) How can you call it a “bubble” when the value is virtually fixed and the return on investment is going down?
one word. Management.
Seriously, though, alot of it depends on what kind of bonds you have in the portfolio. Some of the lower graded bonds have done horribly, as the public perception of them being able to pay dividends and principle is that some of them may not be able to pay at all. Would you buy GM bonds right now?
US Treasuries are what we are talking about. Perceived safety.
Sure. Anytime you have to pay lots more for the value of an item in order to get it becasuse of a strong inflow of money, it is a bubble. You are just (understandably) confused about valuation of the bonds because they don't "pay" any more than they did before. Just think of the interest rate as an inverse of the sale price (it really is). then you see the valuation bubble. Hope that helps.
Peter Schiff comments: http://caps.fool.com/blogs/viewpost.aspx?bpid=119092&t=01000420523245711617
You’d be way dam better off investing in Spaghettios!!
Ok, thanks. And the way this “bubble” bursts is in a reduction in the value of the dollars invested — inflation.
I get it!
Jasonc, if you’ve got a minute, can I get your opinion on this Peter Schiff article?
BFL.
After years —last 8 years—of investing according to all the “brilliant” strategies, diversify, bond allocation etc. I feel taken by these experts!!
I will have to now even more aggresively manage my own portfolio..that is really look at the funds I am investing in. My puny 1 yr old 401k did fantastic..cause I didn’t have time to ‘invest” it in stocks yet. ha. \
I will take my holidays time to learn more. Also I will be hanging up my laundry to dry instead of running through the dryer and eating more homemdae soup. ha. Yet, my dog Lola refuses to go down to generic doggie biscuits!! but then, she is head of the household so no argument there.
The limit on FDIC-insured CDs is now $250,000, not $100,000.
You lose a little in liquidity, when compared to Treasuries, but not much.
vbmfx
Bonds not bond funds. Equities, not equity funds.
yitbos
my investments were in bond funds....and also stock (equity) funds.
It was a realtively short term bond fund which should have been more conservative than my value stock fund. so I was going with what the “experts” said, have a portion in bond funds to offset the stock funds if the market gets hit.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.