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Ex-Fed boss Greenspan says ‘there is no barrier’ to Treasury yields falling below zero
MarketWatch ^ | Aug. 14, 2019 | Mark DeCambre

Posted on 08/14/2019 6:59:41 AM PDT by Leaning Right

There is some $15 trillion in government debt that now yields less than zero, and former Federal Reserve Chairman Alan Greenspan believes there’s no reason why U.S. government bond yields couldn’t join much of the developed world in the subzero world.

(Excerpt) Read more at marketwatch.com ...


TOPICS: Business/Economy
KEYWORDS: greenspan; treasury; yields
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Seniors used to rely on Treasuries yielding maybe 5% as a safe way to help fund their retirement. Looks like those days are gone. So it’s either dabble in the stock market or get a part-time job at Walmart.
1 posted on 08/14/2019 6:59:41 AM PDT by Leaning Right
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To: Leaning Right
Seniors used to rely on Treasuries yielding maybe 5% as a safe way to help fund their retirement. Looks like those days are gone. So it’s either dabble in the stock market or get a part-time job at Walmart.

Consult your advisor, there are many other ways to attain investment income in a conservative fashion.

2 posted on 08/14/2019 7:02:17 AM PDT by 1Old Pro
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To: Leaning Right

Well the good news is that congress will probably change tax laws to not tax interest income.


3 posted on 08/14/2019 7:04:53 AM PDT by PeterPrinciple (Thinking Caps are no longer being issued but there must be a warehouse full of them somewhere.)
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To: Leaning Right

The treasury rate compared to inflation is about the same today as it was then, so we savers (I’m one) are no worse off.

I use preferred stocks and pipeline MLPS that pay 4-7% dividends.


4 posted on 08/14/2019 7:09:48 AM PDT by SaxxonWoods (The internet has driven the world mad.)
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To: Leaning Right

So, if savings rates go negative, will mortgage rates go negative too? Banks pay you to lend you money? credit cards pay you when you have a balance?

Not a chance. But this will screw people royally who can no longer work, busted their a$$ to save, and now get a pi$$y rate of interest and will soon get none!

There will be a mass exodus from Trump land.


5 posted on 08/14/2019 7:10:36 AM PDT by I want the USA back (The further a society drifts from the truth, the more it will hate those who speak it. Orwell.)
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To: 1Old Pro

> there are many other ways to attain investment income in a conservative fashion <

Right you are. Annuities, for example. But the rates on such vehicles are influenced by bond rates.


6 posted on 08/14/2019 7:11:12 AM PDT by Leaning Right (I have already previewed or do not wish to preview this composition.)
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To: Leaning Right

1) If it is durations other than short term rates it is the market, not the Fed.

2) If it is the market it is in response to global bond rates. There are a half dozen European nations “paying” negative interest rates. The Fed can’t do anything about that.

3) I currently fear market risk less than interest rate risk.


7 posted on 08/14/2019 7:13:38 AM PDT by jdsteel (Americans are Dreamers too!!!)
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To: Leaning Right

To claim you are for the middle class and the proverbial working man and woman, and push for ever lower interest rates is the height of hypocrisy.

Not only seniors, but pension funds, insurance companies, even Social Security (those FICA taxes are ‘invested’ in Treasuries) depend on the cash flow of risk-free interest.

Ever lower rates starve the middle class and retiring class, and only serve to create asset bubbles.

Negative rates are insane.


8 posted on 08/14/2019 7:16:22 AM PDT by MichaelCorleone (Jesus Christ is not a religion. He's the Truth.)
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To: MichaelCorleone

> Ever lower rates starve the middle class and retiring class, and only serve to create asset bubbles. <

Very true. But when rates are low, governments can borrow more, and put off the day when they must go bankrupt. I suspect this is at least part of the motivation for keeping rates low.


9 posted on 08/14/2019 7:20:23 AM PDT by Leaning Right (I have already previewed or do not wish to preview this composition.)
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To: Leaning Right; 1Old Pro

“There are many other ways to attain investment income in a conservative fashion

Right you are. Annuities, for example. But the rates on such vehicles are influenced by bond rates.”

The annuity companies have to invest the money they receive from you in something. If they go bust, your annuity payments stop.


10 posted on 08/14/2019 7:22:12 AM PDT by alternatives? (Why have an army if there are no borders?)
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To: Leaning Right

You can only safely devalue currency so much. At some point it’s better to just start taking it from people.


11 posted on 08/14/2019 7:22:20 AM PDT by fruser1
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To: alternatives?
The annuity companies have to invest the money they receive from you in something. If they go bust, your annuity payments stop.

Same holds true for anything. Last I heard the government in many states cannot afford their db pensions. Oh, an there are ongoing rumors that your Social Security and Medicare benefits will be cut.

12 posted on 08/14/2019 7:24:18 AM PDT by 1Old Pro
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To: Leaning Right

It would be far better to cut taxes in order to increase yields.


13 posted on 08/14/2019 7:25:10 AM PDT by Moonman62 (Charity comes from wealth.)
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To: Moonman62

Nations like China have to pay us to hold our debt instruments? Tee Hee.


14 posted on 08/14/2019 7:36:43 AM PDT by Don Corleone (Nothing makes the delusional more furious than truth.)
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To: Leaning Right

And thus the Dow opens down 400 points.


15 posted on 08/14/2019 7:42:00 AM PDT by jmaroneps37 (Conservatism is truth. Liberalism is lies.)
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To: Leaning Right

And thus the Dow opens down 400 points.


16 posted on 08/14/2019 7:42:37 AM PDT by jmaroneps37 (Conservatism is truth. Liberalism is lies.)
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To: Leaning Right

Dabbling is foolish.

Investing is an index fund provided by any one of several major financial houses is investing in America and over the long haul is risk free. Betting on America is a safe bet

Getting a part time job is not a waste. It keeps you sharp.


17 posted on 08/14/2019 7:45:35 AM PDT by bert ( (KE. NP. N.btyC. +12) Progressives are existential American enemies)
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To: 1Old Pro
Consult your advisor...

Agree. If you don't have an advisor, get one. A good advisor will have a track record of beating the S&P 500 by 2% or more.

However, you cannot expect an ROI of S&P 500 +2% with a low risk portfolio.

Your advisor should provide a retirement plan that provides a "reasonable" rate of return, with low risk and the ability to ride out a bear market.

The "reasonable" rate of return should then be used for retirement planning.

18 posted on 08/14/2019 7:52:37 AM PDT by FtrPilot
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To: Leaning Right

Right, unfortunately.

One thing that could help or at least put off the day of reckoning is to get banks to lower the interest charged on credit cards, it seems to me.

Why that is not even talked about (even by the socialist Dems) is a mystery to me.


19 posted on 08/14/2019 8:00:22 AM PDT by MichaelCorleone (Jesus Christ is not a religion. He's the Truth.)
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To: bert

> Investing is an index fund provided by any one of several major financial houses is investing in America and over the long haul is risk free. <

That is excellent advice for any young person! But the key phrase there is “long haul”. What about a senior citizen who needs monthly income?

Banks now pay next to nothing. Bond rates are not much better. I guess you could consider annuities and reverse mortgages. But those things give me the willies.

And then there are dividend-paying stocks. But then you’re taking on market risk. Should a senior citizen be risking a good portion of his savings in the market? I just don’t know.

P.S. I’m really not asking for myself here. Just throwing out something for comment.


20 posted on 08/14/2019 8:03:07 AM PDT by Leaning Right (I have already previewed or do not wish to preview this composition.)
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