#Treasury bonds

[phoenixyfriend]

Ko-Fi prompt from Isabelo:

Hi! I'm new to the workforce and now that I have some money I'm worried it's losing its value to inflation just sitting in my bank. I wanted to ask if you have ideas on how to counteract inflation, maybe through investing?

I've been putting this off for a long time because...

I am not a finance person. I am not an investments person. I actually kinda turned and ran from that whole sector of the business world, at first because I didn't understand it, and then once I did understand it, because I disagreed with much of it on a fundamental level.

But... I can describe some factors and options, and hope to get you started.

I AM NOT LEGALLY QUALIFIED TO GIVE FINANCIAL ADVICE. THIS IS NOT FINANCIAL ADVICE.

What is inflation, and what impacts it?

Inflation is the rate at which money loses value over time. It's the reason something that cost 50 cents in the 1840s costs $50 now.

A lot of things do impact inflation, like housing costs and wage increases and supply chains, but the big one that is relevant here is federal interest rates. The short version: if you borrow money from the government, you have to pay it back. The higher the interest rates on those loans, the lower inflation is. This is for... a lot of reasons that are complicated. The reason I bring it up is less so:

The government offers investments:

So yeah, the feds can impact inflation, but they also offer investment opportunities. There are three common types available to the average person: Bonds, Bills, and Notes. I'll link to an article on Investopedia again, but the summary is as follows: You buy a bill, bond, or note from the government. You have loaned them money, as if you are the bank. Then, they give it back, with interest.

Treasury Bills: shortest timeframe (four weeks to a year), and lowest return on investment. You buy it at a discount (let's say $475), and then the government returns the "full value" that the bond is, nominally (let's say $500). You don't earn twice-yearly interest, but you did earn $25 on the basis of Loaning The Government Some Cash.

Treasury Notes: 2-10 year timeframe. Very popular, very stable. Banks watch it to see how they should plan the interest rates for mortgages and other large loans. Also pretty high liquidity, which means you can sell it to someone else if you suddenly need the cash before your ten-year waiting period is up. You get interest payments twice a year.

Treasury Bonds: 20-30 years. This is like... the inverse of a house mortgage. It takes forever, but it does have the highest yield. You get interest payments twice a year.

Why invest money into the US Treasury department, whether through the above or a different government paper? (Savings bonds aren't on sold the set schedule that treasury bonds are, but they only come in 30-year terms.)

It is very, very low risk. It is pretty much the lowest risk investment a person can make, at least in the US. (I'm afraid I don't know if you're American, but if you're not, your country probably has something similar.)

Interest rates do change, often in reaction or in relation to inflation. If your primary concern is inflation, not getting a high return on investment, I would look into government papers as a way to ensure your money is not losing value on you.

This is the website that tells you the government's own data for current yield and sales, etc. You can find a schedule for upcoming auctions, as well.

High-yield bank accounts:

Savings accounts can come with a pretty unremarkable but steady return on investment; you just need to make sure you find one that suits you. Some of the higher-yield accounts require a minimum balance or a yearly fee... but if you've got a good enough chunk of cash to start with, that might be worth it for you.

They are almost as reliable as government bonds, and are insured by the government up to $250,000. Right now, they come with a lower ROI than most bonds/bills/notes (federal interest rates are pretty high at the moment, to combat inflation). Unlike government papers, though, you can deposit and withdraw money from a savings account pretty much any time.

Certificates of Deposit:

Okay, imagine you are loaning money to your bank, with the fixed term of "I will get this money back with interest, but only in ten years when the contract is up" like the Treasury Notes.

That's what this is.

Also, Investopedia updates near-daily with the highest rates of the moment, which is pretty cool.

Property:

Honestly, if you're coming to me for advice, you almost definitely cannot afford to treat real estate as an investment thing. You would be going to an actual financial professional. As such... IDK, people definitely do it, and it's a standby for a reason, but it's not... you don't want to be a victim of the housing bubble, you know? And me giving advice would probably make you one. So. Talk to a professional if this is the route you want to take.

Retirement accounts:

Pension accounts are a kind of savings account. You've heard of a 401(k)? It's that. Basically, you put your money in a savings account with a company that specializes in pensions, and they invest it in a variety of different fields and markets (you can generally choose some of this) in order to ensure that the money grows enough that you can hopefully retire on it in fifty years. The ROI is usually higher than inflation.

These kinds of accounts have a higher potential for returns than bonds or treasury notes, buuuuut they're less reliable and more sensitive to market fluctuations.

However, your employer may pay into it, matching your contribution. If they agree to match up to 4%, and you pay 4% of your paycheck into an pension fund, then they will pay that same amount and you are functionally getting 8% of your paycheck put into retirement while only paying for half of it yourself.

Mutual Funds:

I've definitely linked this article before, but the short version is:

An investment company buys 100 shares of stock: 10 shares each in 10 different "general" companies. You, who cannot afford a share of each of these companies, buy 1 singular share of that investment company. That share is then treated as one-tenth of a share of each of those 10 "general" companies. You are one of 100 people who has each bought "one stock" that is actually one tenth of ten different stocks.

Most retirement funds are actually a form of mutual fund that includes employer contributions.

Pros: It's more stable than investing directly in the stock market, because you can diversify without having to pay the full price of a share in each company you invest in.

Cons: The investment company does get a cut, and they are... often not great influences on the economy at large. Mutual funds are technically supposed to be more regulated than hedge funds (which are, you know, often venture capital/private equity), but a lot of mutual funds like insurance companies and pension funds will invest a portion of their own money into hedge funds, which is... technically their job. But, you know, capitalism.

Directly investing in the stock market:

Follow people who actually know what they're doing and are not Evil Finance Bros who only care about the bottom line. I haven't watched more than a few videos yet, but The Financial Diet has had good energy on this topic from what I've seen so far, and I enjoy the very general trends I hear about on Morning Brew.

That said, we are not talking about speculative capital gains. We are talking about making sure inflation doesn't screw with you.

DIVIDENDS are profit that the company shares to investors every quarter. Did the company make $2 billion after paying its mortgages, employees, energy bill, etc? Great, that $2 billion will be shared out among the hundreds of thousands of stocks. You'll probably only get a few cents back per stock (e.g. Walmart has been trading at $50-$60 for the past six months, and their dividends have been 57 cents and then 20.75 cents), but it adds up... sort of. The Walmart example is listed as having dividends that are lower than inflation, so you're actually losing money. It's part of why people rely on capital gains so much, rather than dividends, when it comes to building wealth.

Blue Chip Stocks: These are old, stable companies that you can expect to return on your investment at a steady rate. You probably aren't going to see your share jump from $5 to $50 in a year, but you also probably won't see it do the reverse. You will most likely get reliable, if not amazing, dividends.

Preferred Stocks: These are stock shares that have more reliable dividends, but no voting rights. Since you are, presumably, not a billionaire that can theoretically gain a controlling share, I can't imagine the voting rights in a given company are all that important anyway.

Anyway, hope this much-delayed Intro To Investing was, if not worth the wait, at least, a bit longer than you expected.

Hey! You got interest on the word count! It's topical! Ish.

[siliconpalms]

U.S. Treasury to Launch $46 Billion Buyback Program: Aiming for Enhanced Market Liquidity

In a significant move set to impact the financial markets, the U.S. Treasury is gearing up to launch a $46 billion buyback program for government securities starting tomorrow. This initiative, which will run through the end of October, aims to manage the supply of bonds in the market and enhance overall market liquidity. While this move is expected to stabilize market conditions, it also raises…

[warnerrayan754]

Treasury Bills - Invest in Treasury Bonds & Savings Bonds | Century Financial

Invest in treasury bills & bonds and diversify your investment portfolio with Century Financial. Trade treasury CFD's from global markets including instruments like gilts, bunds, bonds & treasury notes.

[bondsindia]

Where to Buy Government Bonds in India

Government bonds are a popular investment option for Indian investors. They are considered to be safe and offer a fixed rate of return. There are a few different places where you can buy government bonds in India.

Banks

Most banks in India offer government bonds to their customers. You can buy bonds through your bank's online portal or by visiting a branch.

Post Offices

The Indian Post Office also sells government bonds. You can buy bonds through your local post office.

Brokerage Firms

Brokerage firms allow you to buy and sell government bonds on the stock exchange. This is a good option if you want to trade bonds actively.

RBI Retail Direct

The Reserve Bank of India (RBI) offers a retail direct platform where you can buy government bonds directly from the RBI. This is a good option if you are a beginner investor.

Which is the best place to buy government bonds in India?

The best place to buy government bonds in India depends on your individual circumstances. If you are a beginner investor, the RBI Retail Direct platform is a good option. If you are looking for a wider range of bonds, you can buy bonds through a brokerage firm.

Here are some of the benefits of investing in government bonds in India:

Safety: Government bonds are considered to be one of the safest investment options available. The government of India is backed by the Reserve Bank of India, so there is a low risk of default. Fixed income: Government bonds offer a fixed rate of return, which can provide you with a predictable stream of income. Liquidity: Government bonds are highly liquid, which means that you can easily sell them if you need cash. Tax benefits: Government bonds offer certain tax benefits, such as exemption from capital gains tax.

If you are considering investing in government bonds in India, it is important to do your research and understand the risks involved. You should also speak to a financial advisor to get personalized advice.

Here are some of the risks of investing in government bonds:

Interest rate risk: The value of government bonds can go down if interest rates rise. Inflation risk: The value of government bonds can also go down if inflation rises. Default risk: There is a small risk that the government of India could default on its bonds.

By understanding the risks and benefits of investing in government bonds, you can make an informed decision about whether or not this is the right investment for you.

BondsIndia

Bonds India is a leading provider of government bonds in India. We offer a wide range of bonds to suit all investor needs. We also offer a variety of services to help you buy and sell bonds.

If you are looking to invest in government bonds in India, BondsIndia is the perfect place to start. We offer a safe, secure, and convenient way to buy and sell bonds.

[nrspeculator]

US10YR/US3Mo/Gold - 100/yr. Chart

[zenruption]

When Nations Borrow, Who Lends?

The world is in debt, but to itself. Where does the money come from when a country borrows money, as we see with national deficits and debt?

National debts are typically borrowed from a variety of sources, including individuals, corporations, financial institutions, and other countries. In most cases, national debts are issued in the form of government bonds, which are essentially IOUs that promise to pay back the borrowed money with interest over a set period of time.

Individuals and corporations can buy government bonds directly from the government or through a broker. Financial institutions such as banks and pension funds also invest in government bonds, often as a way to diversify their portfolios and earn a steady stream of income. In addition, other countries may invest in the bonds of another country as a way to earn a return on their excess foreign currency reserves.

The size of a country's national debt can have significant economic and political implications, as it can affect the country's credit rating, interest rates, and ability to borrow money in the future. In some cases, excessive national debt can lead to financial crises and economic instability, as we have seen in several countries over the years.

[takitori67]

Can you draw arjuna and junao with their outfits switched??🙏🏻

Sure!

[gracie-bird]

On the eye of her departure for Monaco to wed her Prince Rainier, Grace Kelly was presented with a silver medal and citation by the US Treasury Department for her work on behalf of the US Savings Bonds program in New York on March 30, 1956. She is shown with the medal, which was formally presented by John R. Buckley, director of the Treasury's Savings Bonds division.

*Photo by Frank Jurkoski via eBay and restored by @gracie-bird

[phoenixyfriend]

Improv comedians: Marriage is a bit. Ready to commit? Criminals: Marriage is a crime. Join me in doing some time? Financiers: Marriage is a bond. Make ours out for the treasury?

[trendynewsnow]

Powell's Standoff with Trump: A Tense Federal Reserve Conference

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[siliconpalms]

Navigating the Complexities of US Treasury Bond Repo Rates in the Era of a $34 Trillion National Debt

In an era where the U.S. national debt has soared to an unprecedented $34 trillion, understanding the intricacies of the Treasury bond repo rate becomes crucial for astute investors. This blog post aims to shed light on the potential risks and indicators to watch in this complex financial landscape, particularly as we move further into 2024. Understanding Repo Rates in the Context of…

[betty-bourgeoisie]

Honestly I really don't view Alfred as being especially wealthy compared to any of the other nations. The country he represents has a lot of money sure, but he's a government bureaucrat with the same union contract and dental insurance as any other government bureaucrat.

[muninnhuginn]

okay so the segue into monetary policy was mildly unexpected

[downthetubes]

Coming Soon: The Name’s Bond - Jane Bond

A fantastic adventure spy thriller comic collection from the Treasury of British Comics, featuring art by legendary comic creator Mike Hubbard, hits book and comic shops this April

Rebellion will release their The Best of Jane Bond collection in April, a fast-moving thriller of a strip first which ran in Tina and Princess Tina between 1967 and 1970. Beautifully drawn by Mike Hubbard, the artist of iconic Daily Mirror strip “Jane”, the strip is set in the Swingin’ Sixties, and there’s only one spy standing between crime and world domination – and her name is Jane Bond! Jane…

[zenruption]

What Are Bonds?

Bonds are debt securities that are issued by companies, municipalities, or governments to raise money. When a bond is issued, the issuer borrows money from investors in exchange for future payments, typically in the form of interest and principal. Bonds are a type of fixed-income security, which means that they pay a fixed amount of interest over a set period of time.

There are many different types of bonds, including government bonds, corporate bonds, municipal bonds, and foreign bonds. Government bonds are issued by national governments and are considered to be among the safest investments, as they are typically backed by the full faith and credit of the government. Corporate bonds are issued by companies and can range in risk from relatively safe to highly speculative. Municipal bonds are issued by local governments and are typically used to finance infrastructure projects such as schools, highways, and water systems. Foreign bonds are issued by governments or corporations in foreign countries and are denominated in a foreign currency.

Bonds can be bought and sold on financial markets, and their prices can fluctuate based on a variety of factors, including changes in interest rates, credit ratings, and economic conditions. For investors, bonds can be an attractive investment option because they offer a relatively stable source of income and can help to diversify a portfolio. However, like any investment, bonds carry a certain level of risk and investors should carefully consider their investment objectives and risk tolerance before investing.