The debt debate continues. Should a government be using or reducing debt to overcome its country’s financial woes? What works, what doesn’t, under what circumstances, and how much should we worry about it?
Both term deposits and managed bond funds can play a role for investors who want relative capital security and reliability of income. Despite their obvious differences, they are really apples and apples.
Diversified income funds have been extremely popular and have performed well recently, but ‘income’ is often not really income at all. If there is a reversal in some or all of the underlying factors, returns are at risk.
The government should be the key provider of a national annuity scheme to cater for what is now a growing gap in our retirement incomes system as a result of people living for 80 years and more.
Google searches for ‘term deposits’ peaked in late 2009, and since 2011 have been in steady decline. At the beginning of 2013, the searches for term deposits are at their lowest for five years.
Many people regard inflation as a relatively recent phenomenon – it was a problem in the 1970s and it appeared to have been cured in the great ‘disinflation’ of the 1980s and 1990s. But inflation is not a recent phenomenon, and it certainly has not been ‘cured’.