Letters to the Editor
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Monkey's Uncle Sam: Reports from the Banana Republic
Argentina is going through the same inflation hoax as the United States, ( and the President's wife is all set to succeed him). Inflation bond holders have been slaughtered of late, because the numbers were pretty high to begin with. Not so in the Banana Republica of America, where the CPI is flat line, and oil is nearing $100 a barrel. One pundit reported that the bond vigilantes were hedging their positions with gold. When than unwinds, oh brother.
Meanwhile if you buy TIPS from your Monkey's Uncle Sam, he guarantees your principle, and what are the first rules of investing? Buy value when it is being discounted. (and preserve capital) Inflation is a bargain right now. Even Bernanke is worried about TIPS, and not because he is afraid Joe America will lose money buying them either.
When inflation hits 10% and interest rates are still half, (The new all powerful OZ has it under control, just like the BOJ), those TIPS holders will be celebrating, and the secondary market in inflation indexed securities wil soar.