Re: The Plot Thickens
 

Well, yeah, but the question was why lend it to the government for no return.

My mostly sarcastic response doesn't answer that, of course, because no return does not protect against deflation.

Actually the mattress is lower transaction cost, and potentially lower risk. I wonder what the odds of burglary and theft are compared to the odds of a default by the federal government. I guess the chances of the latter are pretty low if people are willing to lend to it for free, but while government bonds are often used as a proxy for riskless investment, they are nonetheless not risk free.

Re: The Plot Thickens
 

When was the last time the U.S. government defaulted? When was the last house fire?

But let's not be silly. You'd need an awful lot of mattresses to store all of Apple's cash. If it's just me, FDIC insurance is essentially as good as a 0% t-bill, since if the government defaults on that insurance, it's defaulting on pretty much everything.

Re: The Plot Thickens
 

Yeah.. I'm just saying that default isn't an impossibility.

Re: The Plot Thickens
 

Including those federal reserve notes in Adder's mattress. If the USA defaults on FDIC insurance, FNMA/FHMLC obligations or T-Bills/-Notes, basically nothing dollar denominated will be worth shit.

Re: The Plot Thickens
 

I've got that covered, although the bed's a little lumpy.

http://farm3.static.flickr.com/2413/...bd5792.jpg?v=0

Re: The Plot Thickens
 

when I was at MSU I worked in a dorm cleaning up after you rich guys. I took my check to the party store to cash. The owner looked at it, a MSU check, here he was smack in the middle of East Lansing, and he's like "I dunno, it might be bad."

i go, "man you cash it and I'll buy booze from you."

he's like "well, if the check bounces that does me no good."

i goes "if MSU checks start bouncing, what's the point of owning a store in East Lansing."

think about it,

Re: The Plot Thickens
 

Wait, Harvard has a dorm called "MSU" and it's located in East Lansing?

Re: The Plot Thickens
 

dual majors. M/W/F classes, T/Th classes. Harvard didn't have a degree program in dairy cattle animal husbandry and i needed to have a fall back if the engineering/lawyer thing didn't work out.

Re: The Plot Thickens
 

You borrow GM's private jet, or Ford's?

Re: The Plot Thickens
 

translation: I am not Hank's facebook friend.

Re: The Plot Thickens
 

No.

If a company is sitting on $X million to execute on its business, and gets the word from its board that it should invest solely for capital preservation, it buys T-bills. If they have multinational operations, they buy some t-bills in other currencies based on where they plan to spend money. But, if the sole goal is capital preservation, there isn't any other option.

Re: The Plot Thickens
 

FDIC is a separate insurance fund. It goes belly up before T-bills default.

The rest of the country might not be far behind if the FDIC goes bust, but there are several workout scenarios that would have the FDIC insolvent while the rest of the government stays solvent.

Re: The Plot Thickens
 

Well, at least the U.S. government's cost to borrow is decreasing (as it prints money by the cubic kilometer). Presumably, it is retiring the old 30-year notes in favor of as many 10-years at these interest rates as it can.

Re: Are you rich?
 

Uh, they kind of go hand in hand? Technology investments usually highlight redundancies, and the fact that if you give him a Blackberry, laptop, etc... Joe Worker can get a bunch more shit done.

Re: Are you rich?
 

So was I.