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These charts compare the Nominal and Real Treasury Yield Curves provided by the Treasury Department.
The 'real' return is the return on the debt less expected inflation. A note on how the Treasury calculates this is below. Since they use TIPS the real yield are only done for notes of 5 years or more duration.
The comparison is between February 22 data from this year and last year.
As one can see, the Fed's "Operation Twist" has had a profound effect on the real returns achieved by holders of US sovereign debt.
The real yields turn positive about the 15 year mark. The real return these days on a 30 Year Bond is about .76%. And that is probably using rather optimistic assumptions about inflation risk.
What this implies is that savers are by and large paying the US government to borrow from them.
No wonder certain alternative stores of wealth are rallying as a haven from this soft confiscation.
http://jessescrossroadscafe.blogspot.com/
The 'real' return is the return on the debt less expected inflation. A note on how the Treasury calculates this is below. Since they use TIPS the real yield are only done for notes of 5 years or more duration.
The comparison is between February 22 data from this year and last year.
As one can see, the Fed's "Operation Twist" has had a profound effect on the real returns achieved by holders of US sovereign debt.
The real yields turn positive about the 15 year mark. The real return these days on a 30 Year Bond is about .76%. And that is probably using rather optimistic assumptions about inflation risk.
What this implies is that savers are by and large paying the US government to borrow from them.
No wonder certain alternative stores of wealth are rallying as a haven from this soft confiscation.