Wednesday, August 03, 2005

The name's Bond, 30 year bond

Here's an interesting site.
The Federal Government announced that the venerable 30 year bond will make a return. Now, I'm not an economist nor do I play one on TV, but I agree with the decision. With interest rates so low, it makes sense to finance government operations with cheaper money.
As with any good idea from the Bush Administration, there are those who try to make political hay out of it. "Sen. Jon Corzine, D-N.J., once a top executive at Goldman Sachs, said bringing back the long bond was a good idea. He used the announcement, though, as an opportunity to jab the administration. 'The bond has become all the more necessary in light of the federal government's excessive borrowing,' he said."
Hey bright boy, didja notice there's a war on? Didn't think so. Jackass. Spending of nearly all types goes up during wartime. You think a former top executive at a brokerage house would know that. You would unless said person didn't think we were in a war, or worse, would prefer we lose if it would give him political power. Let's hope that's not the case.
The issuance of the new 30 year bonds is a good idea. They are a good fit for retirement funds and other well rounded portfolios. I support this idea. Bye now, and buy bonds.


GUYK said...

Makes pretty good sense for the 'govment' but not too much for the investor unless the investor wants something safe with a low return. I have some that are based on the discount rate-the rate that the fed loans money to banks at. When the rate goes up my bonds earn more and when the ratesinks-as it did a couple of years ago to damn near nothing I just piss and moan. But I remember the late seventies when intest was double digit. I would hate to lock a lot of money up for thirty years at this low of a rate. Could get hurt.