Nobody wants U.S. Treasury bonds

Re:Nobody wants U.S. Treasury bonds by pooper on Tuesday November 28, 2023 @06:17PM (#38452972)

I read what the article said but all I can think of is that everybody is betting on inflation getting worse which means the Federal Reserve will continue raising rates which means if you buy a long term bond now you are worse off than holding literal cash and buying bonds in n months.

I hope I am wrong. I hope we won't see more interest rate hikes but wishes are not fishes.

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Re:Nobody wants U.S. Treasury bonds by beezle on Tuesday November 28, 2023 @07:03PM (#38453501)

Well most in the market are now on the other side of that bet but even argument's sake and say it is true, there is a fairly good chance that the bond you buy today will be better than the one n months from now because the consensus was wrong (ie, economy slowed, fed cut, some unexpected headwinds, etc).

This is no different than sitting on the sidelines trying to get into a stock at the perfect point or waiting on 'the inevitable sell off'. Maybe it happens, happy days. Maybe it doesn't, very sad days.

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Re:Nobody wants U.S. Treasury bonds by dragontamer on Tuesday November 28, 2023 @06:23PM (#38453043)

TIPS and I-bonds are still Treasury Bonds.

So... on the contrary. People have been selling TIPS and I-Bonds because inflation has come down from 9% to only 3%ish these days, so if you're buying inflation-based bonds, you're losing out significantly.

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Re:Nobody wants U.S. Treasury bonds by WheatMillington on Tuesday November 28, 2023 @06:47PM (#38453325)

I'm sorry, what? Do you have any idea whatsoever you're talking about? Why would cash, with a nominal value of x, be worth more in in a year than cash with a nominal value of x plus some interest? Inflation aside, as this affects the value of your holdings in any case, in what universe are you better off doing nothing than earning a return?

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Re:Nobody wants U.S. Treasury bonds by dragontamer on Tuesday November 28, 2023 @08:00PM (#38454017)

On this point, the other guy was correct.

Cash today is worth 5.25% from a money market fund (aka: the overnight lending rate). 10Y Bonds are only 4.5% or something.

So "cash" (where "cash" means a money market fund, which is a generally accepted definition of "cash") is beating the 10Y and 30Y at the moment.

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Re:Nobody wants U.S. Treasury bonds by Rury on Tuesday November 28, 2023 @08:38PM (#38454330)

It can, it just depends. Take these hypothetical scenarios for example:

Scenario 1: Buy 10Y today, @4.5% interest.

Scenario 2: Hold that money as cash for 5 years, and then use it to buy 5Y when it's yielding 17% interest.

Scenario 2 will yield a greater ROI after the 10 years. Obviously, there's no way of knowing exactly what the future will hold (many other scenarios are also possible). It just all depends.

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Re:Nobody wants U.S. Treasury bonds by xyzzy123 on Tuesday November 28, 2023 @10:22PM (#38455093)

Perhaps the misconception is the idea that you could buy 10Y now and then sell them later for the same value if a better rate comes along, i.e, mistaking 10Y bonds for "cash" and not realising they can drop in value.

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