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To: Nervous Tick
What always makes me pull back is the fear of inflation looming on the horizon.

Me too.

And I'm very largely in cash as well. But cash is going to depreciate rapidly in the next few years so we have to figure out what to do. Short term bond funds would seem to be one answer. The interest paid on new issue bonds has to start rising in the near future (assuming inflation). Short term bond funds will be holding maturing bonds at lower interest than the new issues they will be buying so the the average dividend should increase with inflation.

That's my current thinking. But I'm still researching bonds in general. I'm certainly no expert.

11 posted on 04/23/2009 6:35:25 AM PDT by InterceptPoint
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To: InterceptPoint

>> But cash is going to depreciate rapidly in the next few years so we have to figure out what to do.

I’m with you 100% there. Cash is king... yet, cash is doomed.

>> Short term bond funds would seem to be one answer.

Relatively unsophisticated investor that I am, I hadn’t made the distinction between bonds in general and SHORT term bond funds. I think your suggestion has merit, and I’ll look into it. tks


12 posted on 04/23/2009 6:40:36 AM PDT by Nervous Tick (Party? I don't have one anymore.)
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