whidbey

Thursday Outlook: No Inflation? Who Knew?!

The consequences of a generally rising bond rate are not pleasant to contemplate for a growing retired US/Global population. But I agree the trend is up, and for retired folks it means loss of principal in fixed income funds, probably not offset by interest income which may not keep up with inflation in any case. Moreover, any income will be taxed except for Roth owners (maybe). Shift to Roth and pay the tax now? Is that a fair definition of the choices open to the retired? Further, such choices will not be mitigated by "diversification to taste" as the writer above suggests.

It will prove cheaper to the governments involved to lower tax rates on the retired. Of course that will require a cut in federal expenditures. The earth must move and it appears that few, if any, of the politicians have noticed the coming upheaval involved in a repricing of risk.