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A comment on Tech bubbles are bursting all over the place. Parent comment

Re:Tech bubbles are bursting all over the place by drexlspivey on Friday May 13, 2022 @04:35PM (#31372276)
The future cash flow of existing bonds is fixed and it does not increase. If you have a bond that pays a 2% annual coupon you will see it's value drop when interest rates increase. The reason is that you can now get a newly issued bond that pays a higher (say 3%) fixed coupon so your's is worth less.

Your bond's price will drop to say 90% of the notional amount while the new bond will trade at 100% so they will effectively have the same "yield" of 3%.

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Re:Tech bubbles are bursting all over the place by JamesBarney on Tuesday May 17, 2022 @08:15PM (#31417763)
The future cash flow of any given bond stays the same. But from an asset allocators point of view the cost of the future cash flow from a band decreased, making it a more attractive investment.
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