Equally disturbing is the proposal to use a chained CPI-U (C-CPI-U). If enacted, it my have the potential for reducing our semi-annual inflation component by approx. 20 percent. ( There is extensive information on the C-CPI-U at: http://www.bls.gov/cpi/super_paris.pdf )

As for the attack on Savings Bonds — while we may be getting deferred interest, there is a quid pro quo for the government: they get to use our principle for up to 30 years! It is patriotic to own U.S. Bonds. I find this attack on the middle class disturbing.

One reason federal and state governments are in financial trouble is that they are taking in less tax receipts due to the abnormally low interest rate environment on bonds, notes and savings accounts that have been created by Fed market manipulation. Japan tried this a few years back, and the middle class took their money outside the country in search of hire rates. As a retiree, how long can I put up with this continued abuse before I, too, start to thing about taking my money outside of the U.S.? Who will want to invest in the U.S.? When that happens, we all will lose. Congress should think carefully and thoughtfully about the the full ramifications of their legislation before enactment.

thanks!

Rich

Tom Adam

What are the consequences if one exceeds the purchase limit for savings bonds?

Here's an interesting page on TreasuryDirect that shows the average interest rates the government paid in January by security type. I bonds are in the Non-Marketable section and are called United States Savings Inflation Securities.

Note that holders of I bonds are, on average, earning quite a bit more than most.

Tom Adams

I swore to never buy below 1.0%FR, then I lowered my standards and bought some at 0.7% last year…

Bogleheads allude to Treasury painted in the corner of not offering higher fixed rates due to the swapfest that would prevail…

Your thoughts on this? Is 0.3% as good as it gets!
Thanks…Mark

Even if you invest on the last day of April, the day before the May 1 rate announcement, you get the current (Nov-Apr) rate for six months.

Tom Adams