‘Pathetic yields’ but investors taking TIPS over Treasuries

‘Pathetic yields’ but investors taking TIPS over Treasuries
News from InvestmentNews:

Bonds that pay negative yields are turning into the hottest part of the $ 9.94 trillion market for U.S. Treasuries, a sign of shaken investor confidence in an economy the Federal Reserve says shows only “modest” strength.


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A $ 15 billion auction of Treasury Inflation-Protected Securities this month drew the strongest demand since March even though yields on the notes average less than zero percent for the first time, according to Bank of America Merrill Lynch indexes. Yields on all types of Treasuries are at or near record lows and, except for the 30-year bond, provide negative real returns after taking into account the consumer price index.

Investors are seeking the safety of U.S. debt as analysts cut their growth forecasts and Europe’s fiscal crisis deepens, helping the government borrow record sums to support the economy almost five years after the subprime mortgage meltdown led to worst financial disaster since the Great Depression. TIPS have returned 111.3 percent the past decade, beating the 73.4 percent for Treasuries not indexed to inflation. The Standard…………… continues on InvestmentNews

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Tips for coping in a low interest rate environment
News from New York Daily News:

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Federal Reserve Chairman Ben Bernanke sounded cautionary notes about the economy. The Fed will keep interest rates near zero through 2014.

Frustrated by the paltry returns you’re getting from your savings account?

Get used to it!

Last week, the Federal Reserve said it will keep interest rates low through 2014.

As it is, rates on deposits are at rock bottom. The average yield on a savings account is 0.1% and checking accounts are paying a measly 0.06%, according to Bankrate.com.

“Savers are in a pickle,” said Scott Brewster, a certified financial planner and president of Brewster Financial Planning in Park Slope, Brooklyn.

Getting slammed the most are retirees who are heavily dependent on interest income to pay their bills.

So what should you do in this low rate environment? We asked the experts.

Look at online savings accounts. “If you’re saving for a short-term goal and need to keep your money in cash, your best bet is to use an FDIC-insured savings account,” Brewster said. “Try to find an online savings account that offers close to 1%, with no hidden fees.”

“Even if you are saving for something a few years out, I would keep the fun…………… continues on New York Daily News

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Investment Banking: Institutions, Politics, and Law

Investment Banking: Institutions, Politics, and Law provides an economic rationale for the dominant role of investment banks in the capital markets, and uses it to explain both the historical evolution of the investment banking industry and also recent changes to its organization. Although investment decisions rely upon price-relevant information, it is impossible to establish property rights over it and hence it is very hard to coordinate its exchange. The authors argue that investment banks he

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