igggy

Could Investors Be Wrong (Again) About Treasury Bonds (TLT)?

>The U.S government’s annual deficit of nearly $1.5 trillion is 10% of its GDP, a number never approached since the 1930s Depression. Who is going to buy all of this debt?

When the stock market appears too risky and money market accounts yield 0.5%, people start buying Treasury bonds. They may not buy 30 or 10-year treasuries at first but that might be just a matter of time. The yields are fairly attractive.

In fact, I have recently seen an article on SA saying that treasury holdings among US investors have gone up recently. People have to put their money somewhere and the new oil bubble can only last so long. I myself put some money into a Vanguard long bond fund expecting 10-20% appreciation by the end of the year.