Personal dilemma

[TuesdaysThursdays]

My father saved up money for me to go to college in the form of US savings bonds. When I went away to school I was given the bonds. After school was over I ended up with about 11,000 dollars in high interest savings bonds, 7.5% and higher. That is the value if sold today, not the marked value.

Well, because of my understanding of the current state of the US economy, my desire to get out of US Bonds is very high. I told my father I intended to sell them and invest in something I felt was safer. He asked me to sell them to him, as 7.5 - 11% interest on this safe of an investment is impossible elsewhere.

I feel that if I sell him the bonds, he will lose most, if not all the money in them. I do not know this of course, but I am positive that bonds of any interest are bad investments. I love my father and do not want him to lose money.

I know he would be rather upset if I just cashed them out at the bank instead of selling them to him.

I am looking for some advice.

Edited September 20, 2011 by TuesdaysThursdays

[Greebo]

My father saved up money for me to go to college in the form of US savings bonds. When I went away to school I was given the bonds. After school was over I ended up with about 11,000 dollars in high interest savings bonds, 7.5% and higher. That is the value if sold today, not the marked value.

Well, because of my understanding of the current state of the US economy, my desire to get out of US Bonds is very high. I told my father I intended to sell them and invest in something I felt was safer. He asked me to sell them to him, as 7.5 - 11% interest on this safe of an investment is impossible elsewhere.

I feel that if I sell him the bonds, he will lose most, if not all the money in them. I do not know this of course, but I am positive that bonds of any interest are bad investments. I love my father and do not want him to lose money.

Admirable, but you do not have a crystal ball and cannot be sure of the outcome. I do not share the popular opinion (aka Chicken Little) that we're headed into Atlas Shrugged like conditions in the near future.

The only question here is were the bonds really and truly "given" to you? Or were they "given with strings"? I think you need to ask your father (more tactfully, of course) to clarify his intentions when he gave them to you.

If they are truly yours then ultimately the choice is yours and the choices of your father are not your responsibility. At most you have a "duty" to share your concerns with him before agreeing to the exchange. As long as you know he knows what you think of the bonds, if he then buys them from you, that's on his head, not yours. Your desire to protect him is admirable, but like you, he's a grown-up and can make his own choices.

If he's willing to buy them from you and it makes him happy to do so, and costs you nothing (nothing that's actually yours) to do so, then that's as good a course of action as any.

[Jorge]

At most you have a "duty" to share your concerns with him before agreeing to the exchange.

There is no duty to do anything of the sort. Let the buyer research the situation on their own. There is no duty, Kantian or otherwise, to offer the consumer any information about the product than what you as a seller would like to put forward.

[TuesdaysThursdays]

There were no conditions on the bonds, they are mine and have been mine for 8 years now. I have shared my concern many times with him.

I guess I'll sell them to him with warning. Historically when a country hits it's ' take what you can and run ' stages defaulting on bonds is it's first move, so there is really no warning other than 'things are really bad'.

It has been about a year since I've discussed selling them with him so perhaps he has changed his mind about wanting them. I brought the topic up because I intend to sell them this week and wanted some opinions so I could decide if I should even mention it to him at all.

I'll ask again if he wants them and do that if he does.

[Greebo]

There is no duty to do anything of the sort. Let the buyer research the situation on their own. There is no duty, Kantian or otherwise, to offer the consumer any information about the product than what you as a seller would like to put forward.

Well, first off, I suppose the concept of full disclosure is alien to you?

But that isn't the sense in which I was using the word "duty" (and btw, there is a reason I put it in quotes).

But it is not to him that I wish to speak. I am speaking to those among you who have retained some sovereign shred of their soul, unsold and unstamped: ‘-to the order of others.’ If, in the chaos of the motives that have made you listen to the radio tonight, there was an honest, rational desire to learn what is wrong with the world, you are the man whom I wished to address. By the rules and terms of my code, one owes a rational statement to those whom it does concern and who’re making an effort to know. Those who’re making an effort to fall to understand me, are not a concern of mine.

It was along this sense that I used the word.

[Greebo]

There were no conditions on the bonds, they are mine and have been mine for 8 years now. I have shared my concern many times with him.

I guess I'll sell them to him with warning. Historically when a country hits it's ' take what you can and run ' stages defaulting on bonds is it's first move, so there is really no warning other than 'things are really bad'.

It has been about a year since I've discussed selling them with him so perhaps he has changed his mind about wanting them. I brought the topic up because I intend to sell them this week and wanted some opinions so I could decide if I should even mention it to him at all.

I'll ask again if he wants them and do that if he does.

I think this is wise. I'd simply say, "Dad, I really would prefer that you didn't buy them because I think they're going to end up as junk but if you want them, they're yours."

And leave it at that. And regardless of who purchases them eventually, invest the proceeds wisely.

[softwareNerd]

If I understand the facts right, your father is right: holding these is a good decision, selling them is not. At a time when US dollar holdings earn 2% even over many years, a lot of people would be happy to get these at face value. I don't think these can be transferred, but of course if it is your dad, then it will technically be somewhat like him loaning you money and then you paying it back when the bonds are cashed.