From time to time, Magnifina staff makes quotes to the media. Below is a list of known usages and the original context with which the quote was given. Some quotes are altered with permission, some are cropped with permission, and some are altered without permission or used out of context.



Every investment is a risk/reward trade-off. CDs are a single step up from savings accounts in terms of both risk and reward. The increased risk is because a CD must be held to its maturity whereas savings accounts allow withdrawals at any time.

CDs are widely recognized as one of the safest investments. Their valuation is highly predictable for both the investor and issuer. Additionally, they are insured by the FDIC which eliminates credit risk for the investor.

Neither CDs nor savings accounts are good investments when interest rates are lower than inflation. In this environment, nominal investments tend to underperform real investments. Today, inflation risk significantly outweighs credit risk and most investors should look at securities with more upside potential than CDs.




“Capital gains are profits on tradable assets. For most households, taxable capital assets are securities (such as stocks and bonds), but may include real estate or even cryptocurrency. For federal tax, the difference between short-term and long-term gains is whether the asset has been held for over 1 year continuously. The federal long-term capital gains tax is significantly lower than the short-term rate for most investors. State tax rates vary (please consult with qualified tax professionals for specific advice). Because the long-term rate is lower, investors who have held a profit for 11 months may consider waiting another month before realizing the profit. If there are concerns about the price of the asset, sometimes it can be hedged with short-term Put options.

Tax is generally not withheld in investment accounts, so investors must be responsible to remember potential tax liabilities themselves. Some investors segregate their taxable capital gains into safer assets when reinvesting profits. Other forms of investment income, such as dividend yield or partnership income, is also taxable. Brokers typically send 1099 forms with the relevant information. Stocks organized as Limited Partnerships typically send 10-K forms. These forms usually arrive in the first quarter of the next year. For example, the forms with 2020 tax information might be received in Feb 2021. It is not uncommon for these forms to arrive very near or after April 15. Many investors are forced to file extensions to finalize tax preparation.”




Quote provided as background

In an inflationary environment, it’s best to avoid nominal assets in favor of real assets. Nominal assets, such as CDs and bonds, are priced based on fixed cashflows. Therefore, they have a limited upside which doesn’t fully protect against inflation. Real assets, such as stocks and real estate, have prices which may vary feely. If prices rise across the economy, real assets should hold their relative value. In other words, nominal assets have fixed numbers (such as an interest rate) built into the instrument, while real assets are priced entirely by the market.