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> For more risk averse, almost every buyer of USA governmental bonds gets "even more money back" in exchange for the initial capital. In nominal terms, sure. I
by khuey 2y ago
> For more risk averse, almost every buyer of USA governmental bonds gets "even more money back" in exchange for the initial capital.
In nominal terms, sure. In real terms, ask the banks that bought 30 year treasuries in Spring 2020 how that's going for them.
- ensignavenger 2y agoThe problem for some of those banks wasn't the 30 year treasuries, it was that they bought those treasuries with other peoples money, and other people did not commit to 30 years, so now when the other people come to get their money, the bank doesn't have it. The 30 year treasuries are still doing just fine, in accordance to the terms of the treasury when it was bought.
- eru 2y agoThe treasury offers no fixed terms for inflation. It's a gamble.
- ac29 2y agoInflation adjusted bonds are a thing in the US (though at least with TIPS, the real return has occasionally been negative).