Wednesday, November 12, 2014

Bond yields are un-attractive compared to the past

Frequently, banks will charge you more in fees than you make in interest. 

Ten-year government bond yields in Europe are even lower than in the U.S. In Switzerland, 0.46% is the maximum you’ll earn every year for the next 10 years if you hold such bonds to maturity. 

Today’s investors won’t enjoy the effects of compounding that I enjoyed, having started my career in 1970 when yields were 6%, on their way to 15%.