No. of Recommendations: 4
If someone has $400,000 invested in what is essentially CD rates I have a hard time understanding the logic.

You probably do understand but just disagree with the logic: the risk premium on stocks and bonds today make their return unsatisfactory compared to CD, E/I bonds. In other words, today there is too much money sloshing around which has forced the returns in stocks and bonds down to historic lows. Historically as these returns improve one can expect a drop in dollar value of those investments. This along with the fact that it is very difficult to recover from a loss, a 50% loss requires a 100% gain to break even, makes the return on CD and EE/I bonds preferable. If one thinks the most important rule of investing is don't lose money, then at this time, it is hard to find anything better then CD's and EE/I bonds.
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