[icetonez]

Thanks for your responses. I am new to investing and should mention that my first post was what I think to be a pretty tight translation of my finance prof's lecture last night. To clarify on "best investment" he said it was the best in terms of risk/reward. He also mentioned that many wealthy middle aged proffesionals he consults from time to time have never heard of I bonds because he says their brokers won't mention it to them because they won't make a commision off the I bond. That much makes sense. He also went as far as to say that people don't believe I bonds exist because they sound too good to be true (this I'm not sure I buy). Yes they are protected from inflation, but I remember looking at my dad's old passbooks from the mid 1980's and he was getting 10% or so in his savings account because of high inflation right? So same difference as the I bonds.

Although the logic for his inflation prediction seems in tune with other things I've read (this forum included, Ray Zee's prediction about the dollar continuing to lose value), I also think his inflation predictions are excessive. He told a girl that the Volkswagon Jetta she bought last year for 18k would retail for 600,000k by the time she was 60.

I guess the lesson here is you have to take everything with a grain of salt. This is the same guy who on the first day of class mentioned how he got rocked by the tech bubble buying and selling stocks he knew nothing about trying to make money by the "greater fool theory". He also on that day predicted the dow to drop to 5000 before any more significant gains.

With that said, the I bonds seem to be a good fixed income option, but nothing to get carried away with.