[newacct583]

Cite for that? No one with any expertise has predicted a >7% inflation level that I'm aware of. This sounds like something you got from talk radio.

(Edit: two replies have taken this out of context. Savings bonds have a minimum term of five years (well, without penalty). For them to have a negative yield, we need to see aggregate inflation >7.12% over the next five years. That's nuts, sorry. No one is predicting that.)

[mhmmmmmm]

This particular Bond yields current inflation levels:

"How is the interest rate of an I bond determined? The interest rate combines two separate rates:

A fixed rate of return, which remains the same throughout the life of the I bond.

A variable semiannual inflation rate based on changes in the Consumer Price Index for all Urban Consumers (CPI-U). The Bureau of the Fiscal Service announces the rates each May and November. The semiannual inflation rate announced in May is the change between the CPI-U figures from the preceding September and March; the inflation rate announced in November is the change between the CPI-U figures from the preceding March and September."

So its fairly safe to assume that current inflation levels are indeed 7%.

[anm89]

Telling that your comment is starting to gray out but I have a degree in economics and I don't listen to talk radio

Housing inflation has averaged 14% to start.

https://www.reuters.com/world/us/runaway-us-home-price-rises...

[jacquesm]

And that being an average: it is much worse in some places, here in NL it's 20%, and there are countries where it is even worse.

[newacct583]

Great, then surely you can cite me the source you used to predict that general inflation (not, ahem, some cherry picked real estate numbers) would be higher than 7% over the life of this bond, producing the negative interest you were teasing?

[aeternum]

NY Fed is predicting near/over 7% in many categories: https://www.newyorkfed.org/microeconomics/sce#/commodexp-1

[newacct583]

Not for five years they aren't! That chart ends in a few months. It's just reflecting CURRENT inflation rates. Again I ask, because everyone insists on cherry picking their way around this: Where is the source predicting a >7.12% inflation rate over the next five years? There is none. That's looney-tunes conspiracy nonsense.

[anm89]

Right, calling this some kind of talk radio conspiracy theory is completely ignorant. Go to the analysts at any major bank and see what they've got in their models. Or better yet, as you mentioned, go to the fed itself. And you KNOW, the fed is understating, not overstating those numbers.