Tail Gunner you just completely ignored everything I said. Your links showed nominal CD rates but showed nothing about inflation rates or tax rates. The late 1960s, the 1970s and 1980s were a relatively high inflation period in the U.S.A. Besides its not really a long enough period to judge by. If you long at very long term market history CDs, cash and high grade bonds have turned out to be a dud investment the majority of the time. Overall you could argue that ever since the Federal reserve was created in the U.S.A. over 100 years ago that most of the time fixed income and cash investments have been a very poor long-term choice (at least in the U.S.A.)
http://www.inflation.eu/inflation-rates/...tates.aspx
Lets not forget that during periods of high inflation tax is a killer because tax is paid on nominal income. For example if CPI inflation is 9% and a 12 month term deposit pays 10% and your marginal income tax rate is 30% your after tax nominal return is 7% which is less than the 9% inflation rate. If inflation is 0 and 12 month term deposits pay 1% and your marginal income tax rate is 30% your nominal after tax return is 0.7% which is higher than the 0% inflation figure.
Also in regards to the government budget deficit and debt levels at certain times in U.S. history government deficits and government debt to GDP have been very high. The difference is this time around it was high in peace time as opposed to being high due to war. Official debt to GDP (which admittedly does not include off balance sheet liabilities) and deficits were higher during WW2 in the U.S. then they are today. Interest rates were very low during the great depression. I am just trying to point out that todays high government debt and deficit levels and also the low interest do have some historical precedents.
TailGunner there is so much wrong with almost everything you say that I do not have the time or energy to rebut all the fallacious comments you make.
http://www.inflation.eu/inflation-rates/...tates.aspx
Lets not forget that during periods of high inflation tax is a killer because tax is paid on nominal income. For example if CPI inflation is 9% and a 12 month term deposit pays 10% and your marginal income tax rate is 30% your after tax nominal return is 7% which is less than the 9% inflation rate. If inflation is 0 and 12 month term deposits pay 1% and your marginal income tax rate is 30% your nominal after tax return is 0.7% which is higher than the 0% inflation figure.
Also in regards to the government budget deficit and debt levels at certain times in U.S. history government deficits and government debt to GDP have been very high. The difference is this time around it was high in peace time as opposed to being high due to war. Official debt to GDP (which admittedly does not include off balance sheet liabilities) and deficits were higher during WW2 in the U.S. then they are today. Interest rates were very low during the great depression. I am just trying to point out that todays high government debt and deficit levels and also the low interest do have some historical precedents.
TailGunner there is so much wrong with almost everything you say that I do not have the time or energy to rebut all the fallacious comments you make.