Home › Forums › Financial Markets/Economics › ok I feel stupid asking this,but here goes
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4plexowner.
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February 28, 2010 at 3:59 AM #519166February 28, 2010 at 4:33 AM #519171
4plexowner
Participantso if I invest in a $1000 bond that pays 3.5% and I hold that bond for 10 years in an environment where monetary debasement (inflation for you plebes) is 5% per year, how much am I ahead at the end of those 10 years?
Google “certificate of guaranteed confiscation” for more info
February 28, 2010 at 4:33 AM #5196034plexowner
Participantso if I invest in a $1000 bond that pays 3.5% and I hold that bond for 10 years in an environment where monetary debasement (inflation for you plebes) is 5% per year, how much am I ahead at the end of those 10 years?
Google “certificate of guaranteed confiscation” for more info
February 28, 2010 at 4:33 AM #5190294plexowner
Participantso if I invest in a $1000 bond that pays 3.5% and I hold that bond for 10 years in an environment where monetary debasement (inflation for you plebes) is 5% per year, how much am I ahead at the end of those 10 years?
Google “certificate of guaranteed confiscation” for more info
February 28, 2010 at 4:33 AM #5196974plexowner
Participantso if I invest in a $1000 bond that pays 3.5% and I hold that bond for 10 years in an environment where monetary debasement (inflation for you plebes) is 5% per year, how much am I ahead at the end of those 10 years?
Google “certificate of guaranteed confiscation” for more info
February 28, 2010 at 4:33 AM #5199504plexowner
Participantso if I invest in a $1000 bond that pays 3.5% and I hold that bond for 10 years in an environment where monetary debasement (inflation for you plebes) is 5% per year, how much am I ahead at the end of those 10 years?
Google “certificate of guaranteed confiscation” for more info
February 28, 2010 at 7:48 AM #519176EconProf
ParticipantYou are behind.
You are earning 3.5% per year and losing 5% on your principal, so you are losing 1.5% per year.
This ignors compounding and also state and federal income taxes, which can be important as well.February 28, 2010 at 7:48 AM #519702EconProf
ParticipantYou are behind.
You are earning 3.5% per year and losing 5% on your principal, so you are losing 1.5% per year.
This ignors compounding and also state and federal income taxes, which can be important as well.February 28, 2010 at 7:48 AM #519608EconProf
ParticipantYou are behind.
You are earning 3.5% per year and losing 5% on your principal, so you are losing 1.5% per year.
This ignors compounding and also state and federal income taxes, which can be important as well.February 28, 2010 at 7:48 AM #519034EconProf
ParticipantYou are behind.
You are earning 3.5% per year and losing 5% on your principal, so you are losing 1.5% per year.
This ignors compounding and also state and federal income taxes, which can be important as well.February 28, 2010 at 7:48 AM #519956EconProf
ParticipantYou are behind.
You are earning 3.5% per year and losing 5% on your principal, so you are losing 1.5% per year.
This ignors compounding and also state and federal income taxes, which can be important as well.February 28, 2010 at 8:01 AM #5197124plexowner
Participantyes, I forgot about taxes
the ‘gain’ on the 10 year investment is $350 as far as the IRS is concerned so the investor now owes capital gains taxes for his investing acumen
let’s see, lose 1.5% per year and owe capital gains taxes on $350
does compounding over 10 years bring us back to even in real terms?
February 28, 2010 at 8:01 AM #5196184plexowner
Participantyes, I forgot about taxes
the ‘gain’ on the 10 year investment is $350 as far as the IRS is concerned so the investor now owes capital gains taxes for his investing acumen
let’s see, lose 1.5% per year and owe capital gains taxes on $350
does compounding over 10 years bring us back to even in real terms?
February 28, 2010 at 8:01 AM #5199664plexowner
Participantyes, I forgot about taxes
the ‘gain’ on the 10 year investment is $350 as far as the IRS is concerned so the investor now owes capital gains taxes for his investing acumen
let’s see, lose 1.5% per year and owe capital gains taxes on $350
does compounding over 10 years bring us back to even in real terms?
February 28, 2010 at 8:01 AM #5190444plexowner
Participantyes, I forgot about taxes
the ‘gain’ on the 10 year investment is $350 as far as the IRS is concerned so the investor now owes capital gains taxes for his investing acumen
let’s see, lose 1.5% per year and owe capital gains taxes on $350
does compounding over 10 years bring us back to even in real terms?
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