Tuesday, November 25, 2008

Put Me Down for $100k

Goldman Sachs is going to be the first of the big financials to offer three year bonds to investors that are 100% guaranteed by the Fed. According to WSJ, the bonds are going to yield 200 bp over like-dated treasuries. The U.S. govvy 10 year pays investors 3.22% today. you you can buy what is functionally the same piece of paper yielding 5.2% tomorrow.

That's a good deal. It's also possible that if you own enough, one of your kids can get a job at Goldman. Jim Altucher at Real Money pointed out yesterday that before yesterday's spike, Goldman preferred was yielding around 15%.

Lots of ways to skin a cat.

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