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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.)

discuss

mhmmmmmm|4 years ago

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|4 years ago

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|4 years ago

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|4 years ago

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?