ISSUE # 60

CIC Info Bytes 03/02/23

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The safest investment in the world is paying more than anytime since 2007. But you’re still going to lose money unless there’s a historic slowdown in inflation.  Treasury Bill Rates at 5% Are No Bargain — Aaron Brown | Bloomberg Personal Finance | 02/17/23

Inflation-linked bonds disappoint even as they deliver on their promise 

— James D. Bruce | Financial Times; reprinted by Economic Gazette | 02/17/23

You Can Use Your Tax Refund to Buy I Bonds, but Should You?  — Ann Carrns | NYT | 02/17/23

Missing Out - Deux

• N.B.  THE THEME of the following coverage should sound familiar.   

  • READ Principal Guaranteed Securities: DON’T Trade Convenience for Yield

Banks Score Big Profits on How Little They Pay You

Interest rates are soaring on seemingly everything these days—that is, except the money you squirreled away in your bank account. When it comes to that nest egg, the needle has been somewhat slower to move. Meanwhile, banks have been scoring monster profits on the widening gap between what they charge borrowers and what they pay you. Not a new story by any stretch, but it’s attracting the ire of politicians from London to Seoul at a time when high inflation is stoking cost-of-living crises. While the backlash has yet to reach critical mass, there are signs political and regulatory pressure is starting to have an impact. 

— Natasha Solo-Lyons | Bloomberg Evening Briefing | 02/27/23

As interest rates soar on seemingly everything except deposits, banks are scoring big profits on the widening gap between what they charge borrowers and pay to savers. That’s attracting the ire of politicians from London to Seoul at a time when rampant inflation is stoking cost-of-living crises and forcing central banks to constrict economic growth. — Bloomberg 5 Things to Start Your Day | 02/28/23

Certificates of deposit are one of the oldest, safest bank products around, but investing in shorter-term CDs right now just isn’t worth it, Alexis Leondis writes in Bloomberg Opinion.  — Bloomberg Evening Briefing | 03/01/23

Bank CDs are an Insult to America’s Savers — Alexis Leondis | Bloomberg | 03/01/23

Higher Rates for Me, Not for Thee

There are a bunch of different ways that benchmark interest rates affect the average person, but perhaps the most visible (other than through mortgage rates) comes via the rate of return on your savings account. At the moment, the average interest rate on US bank accounts is just 0.23% according to Bankrate.com, which is a lot lower than benchmark rates that now sit at 4.5-4.75%. So why the discrepancy?  LISTEN to the latest episode of Odd Lots.  — Tracy Alloway | Bloomberg 5 Things to Start Your Day | 02/23/23

Inflation and Monetary Policy

• The Fed won’t be able to get US inflation down to its 2% target without “crushing the economy,” economist Mohamed El-Erian said on Friday, but he added the central bank is unlikely to change that goal post—at least officially. “You need a higher stable inflation rate. Call it 3 to 4%,” El-Erian said. “I don’t think they can get CPI to 2%...but that’s because 2% is not the right target.” — David Rovella | Bloomberg Evening Briefing | 02/17/23

It’s a Richcession, Not a Recession — Justin Lahart, et. al. | WSJ | 02/17/23

As US inflation receded over the past few months, some economists warned that the situation might get sticky—the kind where inflation seems to retreat only to gum up the works again. This week, that scenario seemed to arrive... 

— Victoria Cavaliere | Bloomberg Weekend Reading | 02/18/23

Investors now expect the major central banks to raise rates much more than they were thinking just at the start of this month. They are still underpricing the risk of how much more tightening is to come… — Ven Ram | Bloomberg 5 Things to Start Your Day | 02/21/23

Bonds came into this week in a funk after those sizzling hot January jobs numbers for the US. Things got worse after a slew of signals that inflation will remain sticky boosted expectations that central bank rates are going up and staying up in Europe, the US and even Australia. The global tightening wave that was supposed to have peaked is instead gathering strength as policymakers repeat the mantra that they need to stay strong to tame inflation. Data around the globe offers them plenty of reasons to be vigilant…

— Garfield Reynolds | Bloomberg 5 Things to Start Your Day | 02/17/23

Retirement

To retire comfortably, you need somewhere between $3 million and $5 million — that’s according to 553 professional and retail investors worldwide who shared their views in the latest MLIV Pulse survey.  Inflation and rising borrowing costs drove the average US 401(k) retirement account down 20% last year, and respondents were not as sure about whether they’d ultimately have enough saved to maintain their lifestyle in retirement. “While inflation appears to be cooling off, it increases the amount of funds that a person needs to have in retirement,” said Christine Benz, Morningstar’s director of personal finance and retirement planning. — Kristine Aquino | Bloomberg 5 Things to Start Your Day | 02/21/23 

Forced Nudity

• TLDR: Despite the general acceptance of nudity in Spain, their Supreme Court ruled that HOAs in the country cannot require nudity in common areas:

Nudity is “a perfectly respectable and legitimate personal choice,” the ruling said, “but its practice cannot be demanded without a basis.”

In particular, the court said the plaintiffs could not be prevented “arbitrarily, by acts of force, through the hiring of private security services” from using the shared facilities. 

Enforced nudity in Spanish holiday home complex was wrong, court rules — Victoria Bisset | The Washington Post | 02/18/23

‘A place of suffering:’ Spanish Supreme Court upholds forced community nudism appeal — José María Brunet | El País | 02/17/23

The Supreme prevents an urbanization from imposing nudism … to access the pool — admin_l6ma5gus | Pledge Times | 02/16/23

Mind Your Own…Camera

• Does your residential community allow cameras mounted to the outside of the front door?  There’s not much you can do about a camera that works through the door viewer / peephole, but rules and regulations can govern exterior accouterments.

Can My Neighbor Point a Video Doorbell at My Apartment Door?

Ronda Kaysen | NYT | 02/18/23