With inflation topping 8% by some estimates, real interest rates have hit a low not seen in the U.S. since the aftermath of World War II. In fact, they have turned negative.
Real interest rates measure the interest one is receiving net of the inflation rate (that is, the interest rate minus inflation). Current estimates have real interest rates somewhere between negative 6% and negative 7%.
Often investors get spooked when negative real interest rates appear, since it means they are losing money (in a real sense) by holding on to safe assets like Treasury bills or T-Bonds. And many speculate that it is this loss of wealth that forces investors into riskier positions.
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