The total amount of Savings Bonds currently outstanding is about $200 billion, which is about 1.5% of the total.

I don't expect this program to significantly increase the current levels of Savings Bond investment, so I'd guess it will cover less than 0.1% of the public debt. In other words, I'd be surprised if the program had an impact on even the rounding error.

The purpose of the program is to give people who don't have access to traditional savings programs a way to save. It was never meant as a way to cover any significant amount of the public debt.

Tom Adams

The United States federal debt equates to $600,000 of debt for each and every American family. This is an "interest only" debt (we are not currently paying back any principle). Short term T-Bill rates are only around 0.02%…so the annual cost to service this debt is just a few thousand dollors per household. But interest rates will eventually rise to historically normal levels between 5% and 10%. At that point the cost per US house will be between $30,000 and $60,000 per year….that is just to cover the cost of interest (not principle)…..it does not include state and local government debt…it does not include the growing cost of entitlements….and it does not include personal household debt.

How much of our federal debt do you think this "tax refund to bonds" program will cover?

Patty

I agree totally. I recall getting savings bonds from my grandparents as gifts in the 1950's. My grandparents mentioned the solid safety of bonds. I never forgot that and it has influenced my "saver mentality" since. Can a grandparent pass the same message to a grandchild by pointing to a serial number of an electronic bond on a computer monitor screen? I'm doubtful.

After all this crisis, I'd think the Treasury could really sell a lot of bonds with some simple marketing. No better time to market a rock solid investment.

As for the paper bond — I read some study results by the savings bond working group (not sure if I have that name right). It was mentioned that a possible alternative to paper bonds was a savings bond debit card of sorts.

That's one sure way to cheapen the savings bond for good…I'll not have my savings bonds in plastic form, thanks…plastic reminds me of cheap crap coming out of China…

Call me old fashioned, but one nice feature of buying savings bonds is getting the paper bond. Stocks and other corp bonds are boring. Could care less about the paper. It's just an electronic holding to me. But US savings bonds just have a nice feel to them in paper form. Drives home the no-nonsense, rock solid feel of the investment.

Invokes a good sense of patriotism too. Holding a nice paper bond and storing it right next the the nice patriotic stash of silver…

Given the fiscal mess this country is in at the present time, I believe individuals will have to increasingly bear the burden for financing their own retirement. The "Joe Sixpacks" of the nation need hocus-pocus free way of saving for retirement that has low risk, tax advantages, and can be purchased in small denominations.

Since the government has found ways to throw money at large corporations that did poorly through poor management decisions, why can't the government do something for the average citizen? I say they should drop the limits on savings bond purchases, offer enticing interest rates on savings bonds, and re-implement income producing bonds (ala series HH bonds) for folks already in retirement. Also, re-implement $10,000 series I bonds, perhaps using Marilyn Monroe's picture on them. If a good interest rate doesn't sell them, perhaps Marilyn will!

I'm glad the tax refund bonds will be in paper form. I'll be happy if paper bonds never go away.