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Inflationary Income
04/17/2015 | | bow-tied economist, econ70, Economic forecasting, economist on radio, economist on TV, eisenberg and economics, Eisenberg and housing economics, Eisenberg and public speaking, Elliot eisenberg, entertaining economist, funniest economist, funny housing economist, Graphsandlaughs, graphsandlaughs and eisenberg, Great public speaking economist, housing sales, MLS, mortgage banking, Multiple listing service, politics and economics, Public speaking economist, www.econ70.com
The Friday File: The Washington Nationals recently signed hurler Max Sherzer to a mind-blowing seven-year $210 million contract, payable over 14 years. Sherzer will receive $15 million/year. Beyond Sherzer’s performance, this is a bet on expected long-term inflation. If inflation averages 2% over the life of the contract, it’s worth $196.6 million. At 4% it’s $173.4 million. A fortune either way but a staggering difference of $23.2 million!