An Economist's Prediction of Widespread "Financial Repression"

Savers and bond investors will suffer in the coming years as governments keep interest rates artificially low, says Carmen Reinhart, co-author of a well-received book called This Time is Different. Stocks will stay volatile but do better th

In case you haven't noticed, interest rates are at rock bottom. For example, three-month Treasury bills pay just 0.05%. Even ten-year Treasury bonds yield less than 2%. Inflation will almost certainly be higher than the yield of T-bills and will probably be greater than the yield on ten-year bonds, so expect negative real, or after-inflation, returns from Treasuries. The same goes for bank deposits and certificates of deposit.

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Steven Goldberg
Contributing Columnist,
Steve has been writing for Kiplinger's for more than 25 years. As an associate editor and then senior associate editor, he covered mutual funds for Kiplinger's Personal Finance magazine from 1994-2006. He also authored a book, But Which Mutual Funds? In 2006 he joined with Jerry Tweddell, one of his best sources on investing, to form Tweddell Goldberg Investment Management to manage money for individual investors. Steve continues to write a regular column for and enjoys hearing investing questions from readers. You can contact Steve at 301.650.6567 or