[66899] in Cypherpunks
Inflation-index bonds and private e-currency
daemon@ATHENA.MIT.EDU (E. Allen Smith)
Mon Sep 30 17:21:55 1996
Date: Mon, 30 Sep 1996 16:01 EDT
From: "E. Allen Smith" <EALLENSMITH@ocelot.Rutgers.EDU>
To: cypherpunks@toad.com
X-Envelope-To: cypherpunks@toad.com
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One of the attractions of privately-produced currencies is as a
hedge against inflation; this development may be a competitor to this
idea. On the other hand, this setup does have an unavailability in _time_
of the money (more so than other, equal-security bonds of the same duration),
which may offset its greater spendability.
-Allen
> BARRON'S Online - Market Surveillance for the Financial Elite
> _________________________________________________________________
> Barron's
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> CLINTON UNVEILING NEW GOVERNMENT BOND WITH INFLATION PROTECTION
> __________________________________________________________________________
> Copyright © 1996 Nando.net
> Copyright © 1996 The Associated Press
> WASHINGTON (Sep 25, 1996 11:12 a.m. EDT) -- President Clinton, in his
> latest election-year appeal to the middle class, is unveiling details
> of a new type of government bond that will offer investors protection
> against inflation.
[...]
> As the program was explained, the securities will protect the
> principal against inflation, as measured by the consumer price index.
> As an example, the official said, if inflation increases 3 percent in
> a given year, a $1,000 bond would be adjusted upward to $1,030 at the
> end of that year.
> By offering this protection, interest rates on the bonds will be lower
> than on regular 10-year notes that do not provide inflation
> protection.
[...]
> The notion of tying government securities to inflation has not been
> tried in the United States, but other countries have been offering
> such investments for some time.
> Such bonds have been available in Britain since 1981 and are also
> offered in Canada, New Zealand, Australia, Israel and Sweden.
> Copyright © 1996 Nando.net
