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2009-01-07 Home Front Economy

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Posted by Anonymoose 2009-01-07 20:48|| || Front Page|| [7 views ] Top

#1 We discussed this in a finance class a few weeks ago. Default risk isn't what you should be worried about with treasuries or AA/AAA bonds, its interest rate and inflation risk. Interest rate risk could discount the living daylights out of your bonds and you will be looking at >20% loss. That would suck.

Posted by bigjim-ky 2009-01-07 23:20|| 2009-01-07 23:20|| Front Page Top

#2 I remember in 1981/2 you could buy US 30 year stripped bonds for 6c on the dollar. Inflation was about 15% at the time.

Were that to happen today, long bonds would lose 80%+ of their value.

Posted by phil_b 2009-01-07 23:32|| 2009-01-07 23:32|| Front Page Top

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