CrusaderFrank
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- May 20, 2009
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Warren Buffett also said that US bonds, that account for 100% of the Social Security "Trust Fund" (LOLz) are a capital graveyard and sure way to lose purchasing power.
"High interest rates, of course, can compensate purchasers for the inflation risk they face with currency-based investments -- and indeed, rates in the early 1980s did that job nicely. Current rates, however, do not come close to offsetting the purchasing-power risk that investors assume. Right now bonds should come with a warning label. (Highlighted my me)
Under today's conditions, therefore, I do not like currency-based investments."
Warren Buffett: Why stocks beat gold and bonds - The Term Sheet: Fortune's deals blogTerm Sheet
Buffett recommends investment in businesses that produce real returns (Coca Cola, Exxon Mobil, etc.)
"High interest rates, of course, can compensate purchasers for the inflation risk they face with currency-based investments -- and indeed, rates in the early 1980s did that job nicely. Current rates, however, do not come close to offsetting the purchasing-power risk that investors assume. Right now bonds should come with a warning label. (Highlighted my me)
Under today's conditions, therefore, I do not like currency-based investments."
Warren Buffett: Why stocks beat gold and bonds - The Term Sheet: Fortune's deals blogTerm Sheet
Buffett recommends investment in businesses that produce real returns (Coca Cola, Exxon Mobil, etc.)