Yiani

Bond Expert: Wednesday Outlook

What do you mean by the following statement?
"I would also point to the breakeven level on TIPS. I follow the breakeven on the 10 year TIP with great interest. As I write this that spread is trading at 239 basis points. That is about mid range of the broad 220 /260 range which has prevailed for several years. So there is danger signal there."

I hold TIPS. Should I sell?

Who's Wrong About Inflation?

The government is understating inflation. The adjustment for "a computer that costs $500 today is of far higher quality than a computer that cost $500 two years ago", is erroneous. Most consumers rarely benefit on an one-to-one basis by the higher quality of their new computer. Price increases on food and energy, on the other hand, are affecting everyone every day.

Why Did the Treasury Department 'Refocus' the I-Bond Program?

Here is another stealing and insult to the small investor: The fixed rate of the I Bonds has been eliminated entirely as of May 1 2008!!! See below:

www.treasurydirect.gov...

Fixed Rates
I bond fixed rates are determined each May 1 and November 1. Each fixed rate applies to all I bonds issued in the six months following the rate determination.

DATE FIXED RATES*
MAY 1, 2008 0.00%
NOV 1, 2007 1.20%
MAY 1, 2007 1.30%
NOV 1, 2006 1.40%
MAY 1, 2006 1.40%
NOV 1, 2005 1.00%
MAY 1, 2005 1.20%
NOV 1, 2004 1.00%
MAY 1, 2004 1.00%
NOV 1, 2003 1.10%
MAY 1, 2003 1.10%
NOV 1, 2002 1.60%
MAY 1, 2002 2.00%
NOV 1, 2001 2.00%
MAY 1, 2001 3.00%
NOV 1, 2000 3.40%
MAY 1, 2000 3.60%
NOV 1, 1999 3.40%
MAY 1, 1999 3.30%
NOV 1, 1998 3.30%
SEP 1, 1998 3.40%
*Annual rates compounded semiannually

Why Did the Treasury Department 'Refocus' the I-Bond Program?

This is just another example of government betrayal of small investors to Wall Street and big business, while saying is doing it to help small investors. How stupid our own government/politicians must think we are!!!