The 30 year US Treasury Bond Action held today has been lauded in the press as being very strong. Well, of course it was.
It was only the third auction of 30 year treasuries since 2001. The auction was also only $9 billion which represents just over 1/1000 of total US Treasury debt government debt outstanding. The government has been restricting supply of these long bonds to keep long term rates low. Given the way the government is spending and fighting wars on credit we are looking at some inflation in the future. That inflation means bond yields will have to go higher. For the good of the country's taxpayers (and to the detriment of the foreigners who keep buying US bonds) I wish the Treasury would issue even longer term bonds at these low rates. There will come a time when todays rate of only 4.812% will seem like an amazing bargain.
See The Office of Public Debt Press Release Here :
See Treasury Direct Homepage for way to avoid your broker when investing in the debt of the US Government.
For the individual small fry I like the I-Bonds. The US savings bond indexed to inflation and you pay no tax on earnings until either redemption or maturity. Information on I-Bonds from the US Department of Public Debt .
Disclosures and Confessions: I own no I-Bonds. I own some E-Series US Savings Bond leftover from the early 90's. For my inflation protected investments, I'm in Treasury Inflation Protected Securities or the Exchange Traded Fund TIP .
Disclaimer: Nothing in this trade log is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security.
Keywords: US Treasuries, Savings Bonds, Bonds, Interest Rates, Inflation, Debt, Government Debt, Treasury, Treasury Direct, Department of Treasury, Small Savers, I-Bonds, I Bonds, TIPS, TIP, Inflation Indexed