http://blog.canadianbusiness.com/inflation-fears-misplaced/ Fri, 20 Nov 2009 07:52:10 -0500 http://wordpress.org/?v=2.8.4 hourly 1 http://blog.canadianbusiness.com/inflation-fears-misplaced/comment-page-1/#comment-17322 Larry MacDonald Wed, 29 Apr 2009 10:42:08 +0000 http://blog.canadianbusiness.com/?p=1574#comment-17322 Gail Going by the official measures of inflation, i.e. consumer price indexes, prices are now falling. The CPI is an average so some items will be showing increases and other negative. Gail
Going by the official measures of inflation, i.e. consumer price indexes, prices are now falling. The CPI is an average so some items will be showing increases and other negative.

]]> http://blog.canadianbusiness.com/inflation-fears-misplaced/comment-page-1/#comment-17158 Gail Bebee Wed, 29 Apr 2009 02:28:57 +0000 http://blog.canadianbusiness.com/?p=1574#comment-17158 In the land of those who buy groceries, food inflation is evident. I was out of the country for 6 weeks and when I returned, I really noticed that grocery prices had gone up, and not just for seasonal produce. A few days later, a Statistics Canada report was released that said food prices rose by an annual rate of 7.9% in March, the biggest increase since November 1986. Core inflation was also up. I think investors should be watching the inflation rate closely. Gail Bebee www.nohypeinvesting.com In the land of those who buy groceries, food inflation is evident. I was out of the country for 6 weeks and when I returned, I really noticed that grocery prices had gone up, and not just for seasonal produce. A few days later, a Statistics Canada report was released that said food prices rose by an annual rate of 7.9% in March, the biggest increase since November 1986. Core inflation was also up. I think investors should be watching the inflation rate closely.
Gail Bebee
http://www.nohypeinvesting.com

]]> http://blog.canadianbusiness.com/inflation-fears-misplaced/comment-page-1/#comment-15663 Larry MacDonald Thu, 23 Apr 2009 09:54:37 +0000 http://blog.canadianbusiness.com/?p=1574#comment-15663 John HTD was a good choice to avoid the currency risk. PLus, I don't think the Fed is buying that maturity and holding down the price like it is on the 10-year Treasury. There will be some downward pressures on Treasury bonds due to the government's deficit going to 12.5% of GDP. I had originally thought there might also be upward pressues due to inflation resurfacing, but lately have begun to question that assumption (in the near to medium term, anyway). I couldn't find any unleveraged inverse bonds funds and would have preferred them to the leverged ETFs to avoid the "constant leverage trap" There are some US mutual funds that short gov bonds without leverage but they can only be bought by US citizens, I believe. John
HTD was a good choice to avoid the currency risk. PLus, I don’t think the Fed is buying that maturity and holding down the price like it is on the 10-year Treasury.
There will be some downward pressures on Treasury bonds due to the government’s deficit going to 12.5% of GDP. I had originally thought there might also be upward pressues due to inflation resurfacing, but lately have begun to question that assumption (in the near to medium term, anyway).
I couldn’t find any unleveraged inverse bonds funds and would have preferred them to the leverged ETFs to avoid the “constant leverage trap” There are some US mutual funds that short gov bonds without leverage but they can only be bought by US citizens, I believe.

]]> http://blog.canadianbusiness.com/inflation-fears-misplaced/comment-page-1/#comment-15621 John Gan Thu, 23 Apr 2009 06:13:43 +0000 http://blog.canadianbusiness.com/?p=1574#comment-15621 Actually, the 30 year long term treasury has already gone up from around 2.5% to 3.8% currently (up over 50%). I went long HTD instead of TBT a couple of months ago (did not want to hold US dollars as I had expected the Cdn $ to strengthen). Problem with the leveraged ETF is that returns are less than 200% return of underlying index over longer term due to daily ups and downs. So even though my bet was right, I'm not making the return I had expected. Not sure if there's a better way to short long term treasury. Actually, the 30 year long term treasury has already gone up from around 2.5% to 3.8% currently (up over 50%). I went long HTD instead of TBT a couple of months ago (did not want to hold US dollars as I had expected the Cdn $ to strengthen).
Problem with the leveraged ETF is that returns are less than 200% return of underlying index over longer term due to daily ups and downs. So even though my bet was right, I’m not making the return I had expected. Not sure if there’s a better way to short long term treasury.

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