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Time for Income: Time for Bonds?

Marc Courteray's disclaimer at the end -- "Please Note: This article is to inform your thinking, not lead it" -- is always refreshing since the reader ends up where he/she was before reading the piece -- aware that she/he must weigh all arguments and make his/her own decision on the inflation/deflation issue. To be sure, looking ahead, relative inflation would be conducive for a better investment climate then would a persistent deflationary environment. I add a thought to consider. My reading of Seeking Alpha comments over past couple of months suggests that the majority of investors inflation will win and is not too far off. With a bias for contrarianism, this makes me more receptive to the Japanese experience argument meaning deflationary pressures will persist for at least a decade during which making money in equities or bonds for non-trading investors will be extremely limited, especially those holding 401 and the like retirement plans.

Regardless, Mr. Courtenary's assertion: "Only you can decide the best place for your money" is the only sure thing, understanding that you may be wrong. Investing is a chess game.

Which Is Safer: Investment Grade Corporate Debt or Government Bonds?

IEric hit the homerun ball in this article. Investment grade corporate bonds purchased from August through November 2008, with maturities of one to five years, especially those of double or tripple A banks and insurance companies in comparison with US treasuries of any maturity, looking back in retrospect at the end of December would have been the best play for conservative investors. The yield to maturity ranged between six and one-half to over nine percent. The ratings on these bonds with few exceptions have remained high investment grade and their values have risen considerably in last four to five weeks. When the masses run in fear to treasuries and ignore investment grade bonds, they will surely lose, especially when they invest in maturies longer than a few months and and hold. Though yields have fallen considerably during the past month, investment grade financial corporate bonof medium duration are still a sound investment for conservative investors who do not trade.