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Peter Schiff - Forever Stamps Tell Us Much

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January 04, 2011 – Comments (9)

The United States Postal Service announced this week that all future first class postage stamps sold will be the so–called “forever stamps” that have no face value but are guaranteed to cover the cost of mailing a first class letter, regardless of how high that cost may rise in the future. Currently these stamps are sold for 44 cents, but will increase in price if and when the Post Office hikes rates.

Apart from sounding the death knell of the one cent stamp, the news is interesting on two fronts: it provides insight into remarkably irresponsible government accounting, and it provides investors with the most attractive Federally-guaranteed inflation protected asset available on the market today.

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9 Comments – Post Your Own

#1) On January 04, 2011 at 1:36 PM, leohaas (36.25) wrote:

I love those articles that come from the Onion!

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#2) On January 04, 2011 at 2:23 PM, ChrisGraley (30.30) wrote:

I wonder what the legalities of hoarding and reselling postage stamps are?

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#3) On January 04, 2011 at 2:33 PM, dargus (85.99) wrote:

Yes, it does seem terribly incompent for the Post Office to save money by not printing stamps that probably cost more to make than their face value.

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#4) On January 04, 2011 at 2:39 PM, rfaramir (29.59) wrote:

"Given these stamps will always be completely liquid, the only way an investor can lose money on forever stamps is if the price of postage goes down. There may not be a single human on the planet who thinks that this is a likely scenario. On the other hand, if postage rates rise with inflation then the stamps are a very, very safe bet."

 

One risk not mentioned is risk that the post office will someday stop honoring them. Simply because of the cost to them of doing so, and because they are a government agency and therefore cannot be fully trusted. I therefore wouldn't call them "a very, very safe bet" but rather a medium-term fairly low-risk inflation hedge.

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#5) On January 05, 2011 at 12:25 AM, Option1307 (29.97) wrote:

+0.10 for charity! :)

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#6) On January 05, 2011 at 12:59 AM, ChrisGraley (30.30) wrote:

kdakota, apparently the 519 area code isn't in the ooma system yet.

I'll post to you if I see anything different later.

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#7) On January 05, 2011 at 10:25 AM, kdakota630 (29.86) wrote:

ChrisGraley

I kind of figured, but thanks for checking for me.  I asked a couple of my tech friends and it appears (according to them) that the closest we have here is Magic Jack.

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#8) On January 06, 2011 at 1:00 AM, kirkydu (93.96) wrote:

Schiff makes a critical mistake in calling for wage and benefit concessions at USPS.  Those workers are hardly overpaid from what I can tell and aren't the cause of USPS budget issues.  Congress has forbid the USPS from raising rates to the appropriate level for decades.  USPS is far cheaper than FedEX or UPS, even though they don't want to be that far under the market.  The USPS problems aren't USPS induced, they are Congress induced. 

The USPS ought to be privatized, but not just dumping them to the wolves.  Rightly they should get all of the real estate, equipment and financial assets plus a payout on the way out.

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#9) On January 12, 2011 at 12:32 AM, Imperial1964 (97.93) wrote:

I have a friend who works for the Post Office.  Those $50k jobs with benefits appear to be gone.  He is working 6 days a week without benefits because they will only hire contractors and temps.

Maybe $50k with a government pension and benefits that they used to advertize were a little high, but my friend is not making anything near that and they will not offer a permanent position and benefits.

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