A few days ago I asked David Cohn, in a blog post, to give us more information about how he would earn the City of Hermosa Beach an extra $300,000 if we elect him to be the next Treasurer. He fleshes this out in his latest glossy junk mail. He plans to put the money in "Federally Insured Bank CD's [sic] and T-Bills."
Math:
$300,000 is 1.2% of the $25,000,000 Hermosa has banked.
Cohen promises to earn us that $300k over the 0.41% we currently earn. So he plans to earn us a total of 1.61%.
The highest 1 year CD rate currently offered on www. BankRate.com = 1.15%
The current yield on 12 month T-Bills = 0.10%
So David Cohn plans to earn us 1.61% by using two investments that each earn much less than 1.61% interest.
David Cohn, please tell us your secret!
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