What is the inflation rate?

Treasury uses the CPI-U inflation rate to calculate the yield of I-Bonds and TIPS.

DATE CPIAUCNS Annualized 3-Mo MA 3 Mo Annualized
2022-03-01 287.5
2022-04-01 289.1 6.70%
2022-05-01 292.3 13.23% 289.6
2022-06-01 296.3 16.48% 292.6 12.2%
2022-07-01 296.3 -0.14% 295.0 9.8%
2022-08-01 296.2 -0.43% 296.3 5.3%
2022-09-01 296.8 2.58% 296.4 0.7%
2022-10-01 298.0 4.87% 297.0 2.3%
2022-11-01 297.7 -1.21% 297.5 2.1%
2022-12-01 296.8 -3.68% 297.5 0.0%
2023-01-01 299.2 9.59% 297.9 1.6%
2023-02-01 300.8 6.70% 298.9 4.2%
2023-03-01 301.8 3.97% 300.6 6.7%

The Federal Reserve prefers to look at the Personal Consumption Expenditures excluding food and energy, which is subsiding gradually.

Any way you slice it, the inflation rate is way above the Fed’s target of 2%.

I don’t see how the Fed will begin to cut the fed funds rate in July as the market expects.



The market is in a flight to safety.

Odd safety, the bond market is more volatile than the equity market. Source my CFA studies.

If any of you want to know more do your own due diligence. And do NOT cry to me when you suddenly realize how big a job that is.

The range of the VIX (stocks) over the past year has been from around 16 up to 36, a factor of 2.25, while MOVE (10-year bond) has ranged from 98 to 199, as factor of 2.03; they are pretty close but it looks as thought equities have the edge.


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Bond rates are lower over time than the general return of the stock market. Individual stocks may outperform bonds by a significant margin, but they are also at a much higher risk of loss. Bonds will always be less volatile on average than stocks because more is known and certain about their income flow .


Stocks are much more volatile, and there is a higher chance of losing your investment since equity holders are subordinated to debt holders if a company is forced to liquidate. However, in return for the risk, stockholders have a greater potential return.Feb 1, 2023

Corporate Financial Institute


You are closer to the truth than either of those proper well written Google results. The two results are misinformation.

You have calculated the standard deviation of sorts.

What you have not done is set that deviation against average return. Meaning that bonds return less and therefor the deviation in real terms is much worse. Meaning very similar volatility for a lower return is a bad bet. You should assume volatility includes a discussion of return.

The investor pays for volatility at times out of the returns. We are only concerned with the returns.

Ah, now you’re talking about something like a Sharpe ratio or Sortino ratio, measures of risk-adjusted return.



The conversation in the CFA program is in the context of returns.

Portfolio management is not in a vacuum.


:rofl: :rofl: :rofl: