The advertised jackpot is therefore the amount that you would get if the prize pool was invested in a portfolio of Treasury bonds for 30 years.Īs a result, each time chair of the Fed, Jerome Powell, raises interest rates and indirectly increases the yields on 30-year Treasury bonds, he is inadvertently increasing the size of lottery jackpots. So if interest rates are higher, they can put it in an investment that's going to yield a higher return than it would have a couple of years ago,' he said. 'All they're doing with the annuity is investing that money for you. 'The cash value is really what Powerball has on hand,' said Jared James, the founder Lotto Edge, which provides insights to various lotteries. The amount advertised by the Powerball as being the jackpot is not the amount the lottery has in a prize pool and able to pay to the winner. The explanation for this lies in how the full jackpot amount is calculated. Each time chair of the Fed, Jerome Powell, raises interest rates and indirectly increases the yields on 30-year Treasury bonds, he is inadvertently increasing the size of lottery jackpotsīy comparison, in January 2021, the winner of the $730 million Powerball jackpot cashed out a whopping $550 million - or around 75 percent.
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