Those may end up being good/great investments and the

Posted on: December 28, 2023 at 16:24:35 CT

odds of the US not coming through on their guarantees in the short run are obviously very low, but they aren't totally risk free.

For instance, when the financial crisis, aka The Great Recession hit in 2008 banks around the world were giving their depositors "haircuts" despite government guarantees. When asked about it US regulators refused to rule out that possibility in the US despite the FDIC guarantees.

Then there is the issue of the value of what you get back vs what you put in. Again the short term nature of those CDs limits risk a lot, but it is quite possible that inflation could quickly ramp up and the value of the money you have invested there at the end of your term is less than when you put it in (eg. it will buy less goods and services) even with the full interest earned... and that isn't even considering the fact that you will owe taxes on the "profit" even if the actual value is less than when you invested it.