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Author: brucedoe Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 77169  
Subject: Re: REIT preferred 2010 forecast Date: 5/7/2010 2:15 PM
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As the now happy owner of a 30-yr Treasury paying 4.5%, I am glad to report that that too is rising (It closed yesterday at 5.65% in the black). The reason I bought it is that there were some analysts who speculated that the interest rate on the 30-yr would revert to 3%. They had several arguments for their conclusion. I don't recall all of them but one was stubborn unemployment. But consider the Euro is falling. Not good news for U.S. exporters. Is that inflationary or deflationary news? I think it is more deflationary. One more reason to stick with the 30 yr.

Corporate bonds are rising also. I was criticized by pros on the Fixed Income Board for casually buying a MSFT bond paying 5.2% (criticized as well as for the 30-yr Treasury), but it closed up yesterday to 7.16% into the black, no matter how temporary. And I have a GE Internote paying 6.25% that is also back in the black by a little bit (1.97%). Skill is very nice but luck is hard to beat.

I read another report the other day that speculated that the U.S. would be in a deflationary mode for another two years. I have no expertise to make such forecasts, but so far they seem to be right. does anyone see an end to the European financial crisis? And by the way, Greece accounts for only 3% of the European Union economy whereas California accounts for 10% of the U.S. economy. We have problems right here in River City even if they aren't being talked about.

brucedoe
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