March 2, 2023
People can directly trade T-Bills, Treasury Bonds, TIPs, and
savings bonds on the Treasury Direct web site. It’s vital that Treasury get the
calculations correct.
The calculator’s interest rate was wrong for this issue. It
showed the previous reset of 10.77%. (See screen shot below) I checked another
issue and it was correct. I don’t know how deep this goes, but there shouldn’t
be any mistakes at all. What’s more, the mistake shows up in my account, too.
It is in my favor, not the Treasury’s.
Fixed rate = 1.1%; Semiannual for
this bond issued 04/2004.
(1/2) year inflation rate: 3.24%
per the bottom of the chart.
Note that Treasury rounds these
calculations to four decimals before converting to percentages.
Composite rate formula is [0.0110 + (2 x 0.0324) + (0.0110 x 0.0324)] = 0.076156
round to 7.62% [Agrees with the chart.]
If I'm correct, and I believe I am, then I have to ask how this could be allowed to happen. If I worked at the U.S. Treasury, I'd be spot sampling everything and checking calculations.
