Young Research & Publishing Inc.

Investment Research Since 1978

Disclosure

  • About Us
    • Contributors
    • Archives
    • The Final Richard C. Young’s Intelligence Report
    • You’ve Read The Last Issue of Intelligence Report, Now What?
    • Dick Young’s Research Key: Anecdotal Evidence Gathering
    • Crisis at Vanguard
  • Investment Analysis
    • Bonds
    • Currencies and Gold
    • Dividend Investing
    • ETFs & Funds
    • Investment Strategy
    • Retirement Investing
    • Stocks
    • The Efficient Frontier
  • Investment Counsel
  • Dynamic Maximizers®
  • Retirement Compounders®
  • Free Email Signup

The Cost of Retirement Income is Going Up

April 9, 2020 By Jeremy Jones, CFA

By Potstock @ Shutterstock.com

The Fed announced this morning that it is going to spend up to $2.3 trillion helping out municipalities and companies by purchasing their bonds. Where is the $2.3 trillion going to come from?

The Fed is of course just going to print the money. Yup, Jay Powell (Fed Chair) & Steve Mnuchin (Treasury Secretary) have decided to turn the Fed into a hedge fund. Munuchin will provide the capital and Powell will provide the leverage by conjuring a few trillion out of thin air. 10 to 1 leverage works for Jay.

Won’t all this money printing cause inflation? Of course it will. The Fed will deny any such thing and point to the last decade of monetary debauchery as proof that money printing doesn’t cause inflation.

But try telling that to the millions of Americans approaching retirement who were told they needed to save loads more to live the kind of retirement life they planned for.

With T-bill rates at 4% it only takes $1,000,000 to generate $40,000 in safe retirement income, but at today’s T-bill rate it takes $19,000,000 to generate that $40,000 in income.

Sounds a lot like inflation to us.

Hold your gold and silver and while the Fed’s interventions into the bond market are a long-term disaster for a variety of reasons (a post for another day), don’t let your distaste for bad monetary policy sway your investment strategy. The Fed just volunteered to become the greater fool of last resort in the corporate bond market and their supply of funds is limitless. The implications should be obvious.

Share this:

  • Email
  • Twitter
  • Facebook

You Might Also Like:

  • Maximize Your Retirement by Leaving Income Taxes Behind
  • Are You a Baby Boomer with a Retirement Income Problem?
  • Healthcare Could Cost You Your Retirement
  • Author
  • Recent Posts
Jeremy Jones, CFA
Jeremy Jones, CFA, CFP® is the Director of Research at Young Research & Publishing Inc., and the Chief Investment Officer at Richard C. Young & Co., Ltd. Richard C. Young & Co., Ltd. was ranked #10 in CNBC's 2019 Financial Advisor Top 100. Jeremy is also a contributing editor of youngresearch.com.
Latest posts by Jeremy Jones, CFA (see all)
  • Jim Simons’s Renaissance Technologies vs. Internet Forum Traders - January 15, 2021
  • Biden Plans to Spend Trillions More on COVID-19 Stimulus - January 14, 2021
  • Overtaken By Nvidia, Intel Fires Bob Swan - January 13, 2021

Search Young Research

Most Popular

  • Do You Remember When NASDAQ Dropped by 82%?
  • Gavekal Chairman: Renewables Bubble is "Stupidest" Ever
  • Vanguard Wellesley (VWINX) vs. Wellington (VWELX): Which Fund is Best?
  • Don’t Be on Their Radar, Get Out of Debt Now
  • Democrats Eager to Get Back to Protecting the Rich by Ending SALT Deduction Cap
  • Stocks: Are You Sticking Your Neck Out Too Far?
  • There's Always a Way Forward for Americans Like YOU
  • Overtaken By Nvidia, Intel Fires Bob Swan
  • H2O, Skiing, Hiding A$$ET$, Bitcoin, Ammo & More
  • The Power of a Compound Interest Table

Don’t Miss

Default Risk Among the Many Concerns with Annuities

Risk and Reward: An Efficient Frontier

How to be a Billionaire: Proven Strategies from the Titans of Wealth

Could this Be the Vanguard GNMA Winning Edge?

Cryptocosm and Life After Google

Warning: Avoid Mutual Fund Year End Distributions

Is Gold a Good Long-term Investment?

How to Invest in Gold

Vanguard Wellington (VWELX): The Original Balanced Fund

What is the Best Gold ETF for Investing and Trading?

Procter & Gamble (PG) Stock: The Only True Dividend King

The Dividend King of the North

You’ll Love This if You’re Dreaming of an Active Retirement Life

RSS The Latest at Richardcyoung.com

  • Remembering Rev. Martin Luther King Jr.
  • Insurrection Was the Furthest Thing from Trump’s Mind
  • Who Are Those Urging Violence?
  • Are $2,000 Checks Going to Rebuild NYC?
  • An Alert for Warm Weather, Wine Loving Mavens.
  • Key West’s Number One Restaurant: The Thirsty Mermaid
  • VIDEO: Henry U.S. Survival AR-7
  • Cancel Culture, the Great Purge, Double Standards
  • How Are You Doing on a Local Level?
  • We Support Censure of Flake, McCain and Ducey

About Us

  • About Young Research
  • Archives
  • Contributors

Our Partners

  • Richard C. Young & Co.
  • Richardcyoung.com

Social Media

  • Facebook
  • Twitter
  • Youtube
  • Pinterest

Copyright © 2021 | Terms & Conditions

loading Cancel
Post was not sent - check your email addresses!
Email check failed, please try again
Sorry, your blog cannot share posts by email.