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Subject:  Re: Howard: Your Maturities? Date:  10/2/2012  2:29 AM
Author:  howardgt Number:  34427 of 36388


It isn’t just ‘savers’ that are being screwed by Bernanke’s Zero-Interest Rate Policies. It’s us investors as well.

It seems to me that most investments are benefiting from current low rates. Financial asset prices are being bid up and well-capitalized corporations are able to refinance debt at much lower costs. Interest expense saving fall straight to the bottom line. Lower rates also help bond defaults rates stay under control. This is helping fuel the stock and bond market rallies.

Of course it creates a problem for fixed income reinvestments, but a laddered bond portfolio should be able to ride-out a few years of low rates. Yeah, it’s tough when bonds are your only asset class, but this is an inherent risk in an all-bond investment strategy. You win some, you lose some! This is why I choose to be diversified across asset classes.

My maturity table is similar and probably more compressed that yours (due to all-junk), but I’m not too worried. I sort of like the fact that I will have a nice income stream to reinvest. I’m counting on 10% interest and maybe about 7% maturities/calls per year. This will allow me to recycle the portfolio at more favorable returns if and when rates start rising and prices begin to come down.

Charlie, I think you worry too much about this stuff... It’s only money!!!

This one is for you:


year port%
2013 5.9%
2014 8.1%
2015 6.8%
2016 8.9%
2017 14.2%
2018 7.2%
2019 6.8%
2020 2.5%
2021 2.5%
2022 4.2%
2023 2.1%
2024 2.1%
2025 3.8%
2026 0.8%
2027 14.9%
2028 3.4%
2029 1.3%
2030 3.4%
2031 0.8%

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