Michael - appreciate the rundown on the G Fund. Would you please share a similar discussion on the F Fund? Thanks!
From: "Michael Bond michaelhbond@yahoo.com [TSP_Strategy]" <TSP_Strategy@yahoogroups.com>
To: "TSP_Strategy@yahoogroups.com" <TSP_Strategy@yahoogroups.com>
Sent: Friday, February 12, 2016 6:05 PM
Subject: [TSP_Strategy] Re: Negative Interest Rates
The G fund interest rate is determined by a formula based on the *long-term* government treasuries, not the short-term rates. Not surprisingly, as the Fed attempts to raise short term rates the long-term treasury yields are declining sharply based on global deflationary forces exacerbated by Fed tightening monetary policy.
In other words, the G fund interest rate is already declining even as the Fed attempts to raise rates. If the Fed goes negative on short term rates, the long term rates can fall further but if the G fund was to ever go negative the world is in big trouble.
Michael Bond
TSPsmart.com
I just wish the central bankers would ask the simple question "are low/negative interest rates really helping or are the hurting the economy", but they don't.
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Posted by: Eric <mil.flyer@yahoo.com>
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