Sin and Redemption

I was reading for my theology class this morning. Lutheranism actually. It's very interesting, not that it's so far beyond what I know in the Protestant faith. Just whenever you get down to the foundational ideas of anything I think you realize new things.

The Lutheran faith believes that humans are seen as both sinners and completely redeemed. Is that possible?
But then, isn't that what we are?

God saved us, yes, without a doubt. we are redeemed.
But I am a sinner. By nature, by actions.

I am just a little confused at the statement. I am a sinner and yet redeemed. Do they contradict themselves?
Is that the nature of God at work?