But they don t agree, and to make matters worse, even when they agree about a problem, they usually disagree about its solution. Grant, at least, writes a lively column, laced with anecdotes and self-deprecating humor. Anyway, in the April 30 th issue, Shilling and Grant continued to forecast dire happenings and advocated bond investing, but then they parted company on which kind of bonds you should own. It will significantly accelerate the pace of credit creation. In other words, where Schilling foresees de flation, Grant foresees in flation.
TIPs pay a lower rate of interest, but in addition, they pass inflation increases on to bondholders.
At maturity, the bondholder gets the cumulative inflation-adjusted principal. Brinker points to a third alternative stag flation a period when economic growth stagnates while we suffer from inflation, as occurred in the 70s. His favorite bonds are GNMAs. Take your pick. There s no need for a fund s diversification, because if Uncle defaults, equal opportunity will no doubt apply to all bond holders.