A bond purchased today will yield coupon payments that represent a real return if inflation remains very very low for the next 30 years.Kshartle wrote: No I just want to hear if anybody can come up with a credible way you can get a real return in 30 year bonds at current rates.
Almost everyone here is holding them. I'm just wondering if anyone can come up with a credible argument for how someone buying a 30 year T-bond is gonna make a real return in the next 30 years with it. I realize there are other reasons you might own it. We don't need to talk about those other reasons anymore there are hundreds of threads on them.
A bond purchased today may see its capital value rise beyond inflation if interest rates fall again and keep doing so for the next 30 years, winding up near zero (!!!)
A bond purchased today and sold according to rebalance bands when its value rises also has the potential to yield a real return.
Other than that, I don't know. And I don't know if either of the conditions necessary to make those examples come true will exist.
And again, everyone here holds them for reasons other than their ability or inability to generate a real return on their own. We hold 25% cash as well, often derided as an unproductive asset. We know that. We hold it for different reasons.