What mystifyes me is
where the government finds enough suckers who want a 30-year note that yields 4.66%. There was never a year since 1960s when the real inflation (including asset inflation) was lower than 4.66%. For 1 year or 2 years, I'd still understand it, you'll lose 3-5% of the principal, but other than that, you'll be safe. But try losing 3% to inflation tor 30 years in a row, and what do you end up with? If you're a long-term bond investor, you may as well donate your life savings to the Treasury in order not to prolong the financial agony.
"By EMILY BARRETT
May 7, 2008 10:00 a.m.
The 10-year note fell, taking other Treasury maturities lower as well, as market participants looked to build a discount into the forthcoming auction.
The two-year note was recently down 1/32, or 31 cents per $1,000 invested, at 99 16/32 yielding 2.39%, and the 10-year was 8/32 lower at 96 19/32 for 3.92%. The five-year was down 5/32 at 99 24/32 for a 3.18% yield, and the 30-year was 6/32 lower at 95 16/32 yielding 4.66%.