Seeking Alpha

Julian Van Erlach

 
View Julian Van Erlach's Comments BY TICKER:
  • TIPS: Nominal Yield, Risky Real After-Tax Return [View article]
    Dear Greg,

    Consider that the UK consol during the entire pure gold standard 1820- 1910 - through depressions and wars, exhibited a constant real yield (my article on gold). Supply and demand for long term capital would seem to only clear when both sides agree that the maximum real return after tax that can be earned/paid is ...real per capita productivity growth.
    Nov 1 06:13 PM | Likes Like |Link to Comment
  • TIPS: Nominal Yield, Risky Real After-Tax Return [View article]
    Dear Jim - good thoughts. Consider that if untaxed investors were the marginal pricers e.g. charities, foundations - then the current 10 year TIPS yield of just above 2% would be a REAL yield; thus reflecting the required real no tax/after-tax yield. Then the nominal bond should be priced with the same 2% real after-tax yield. However, the real nominal bond after-tax yield based on implied expected inflation is just .5%. This seems to indicate the marginal pricer of both TIPS and nominal bonds is factoring taxation.
    Oct 31 01:21 PM | Likes Like |Link to Comment
More on TIP by Julian Van Erlach
COMMENTS STATS
48 Comments
26 Likes