• RSS Feed
  • Subscriber Login
  • Weiss Ratings
Money and Markets
Skip to content
  • Home
  • Experts
    • Martin D. Weiss, Ph.D.
    • Jack Crooks
    • John Ross Crooks, III
    • Tom Essaye
    • Mike Larson
    • Nilus Mattive
    • Ron Rowland
    • Guest Contributors ►
      • Monty Agarwal
      • Sean Brodrick
      • Amber Dakar
      • Larry Edelson
      • Kevin Kerr
      • Don Lucek
      • Rudy Martin
      • Tony Sagami
      • Peter Schiff
      • Claus Vogt
  • Blog
    • Martin D. Weiss’ Blog
    • Jack Crooks’ Blog
    • Mike Larson’s Blog
    • Nilus Mattive’s Blog
  • Resources
    • Personal Finance Corner ►
      • Hot Tips
      • Investments
      • Money & Banking
      • Consumer Loans
      • College Savings
      • Retirement
      • Credit & Debt
      • Taxes
      • Insurance
      • Life & Home
      • Investment Portfolios
    • Links
  • Services
    • Premium Membership Services  ►
      • Weiss Inner Circle
      • Money and Markets Inner Circle
      • The Weiss Elite
    • Trading Services ►
      • Global Forex Alert
      • International ETF Trader
      • LEAPS Options Alert
      • Million-Dollar Contrarian Portfolio
      • Safe Money’s Crisis Trader
      • Weiss Million-Dollar Ratings Portfolio
      • World Currency Trader
    • Investment Newsletters ►
      • Income Superstars
      • Safe Money
    • Books ►
      • The Ultimate Depression Survival Guide
      • Investing Without Fear
      • The Standard & Poor’s Guide for the New Investor
      • The Ultimate Safe Money Guide
    • Public Service
  • Media and Events
    • Press Releases
    • Money and Markets in the News
    • Upcoming Media
    • Media Archive ►
      • 2011 Media Archive
      • 2010 Media Archive
      • 2009 Media Archive
      • 2008 Media Archive
      • 2007 Media Archive
  • Issues
    • 2011 Issues
    • 2010 Archives
    • 2009 Archives
    • 2008 Archives
    • 2007 Archives
    • 2006 Archives
    • 2005 Archives
    • 2004 Archives
    • 2003 Archives
    • Special Reports
  • Videos
  • Store
  • Contact Us
    • Interview a Money and Markets Analyst
    • Reader’s Comments – Testimonials

Issues

Share Email Print

5 Years of Interest Destroyed in 6 Weeks!

Martin D. Weiss Ph.D. | Sunday, January 25, 2009 at 7:30 am

Martin D. Weiss, Ph.D.

Last month, investors from all over the world — spooked by the debt crisis — flocked to buy long-term U.S. Treasury bonds.

They bought U.S. bonds with money earned from China’s export boom. They scooped up bonds with money gleaned from the savings of millions of Japanese families … with government money … oil money … even drug money.

Investors large and small, haughty and humble — Asian central bankers, mid-East sheiks, and retired Americans living on fixed income — all piled into Treasury bonds at the same time.

And they all had a similar goal: To escape the terrifying dangers … find what they thought was a safe haven … and grasp for something — anything — better than the near-zero yields on short-term Treasury bills.

Many reached out as far as they possibly could in maturity, buying the longest Treasury bond in existence — the 4.5% “long bond” expiring May 15, 2038.

But as the Treasury bond buying frenzy reached a crescendo on December 18 of last year, they didn’t get the coupon yield of 4.5%.

Instead, they had to pay such a high price for the bond, they wound up locked into the lowest Treasury-bond yield in history: A meager 2.52%!

That was bad enough.

But the saga of woes does not end there. The real disaster came with the events that have ensued since …

For each $10,000 in face value bonds, they paid an exorbitant $14,091. And now, the value of that bond has plunged to only $12,200, delivering a shocking loss of $1,890.

The summary of these results reads like a fixed-income horror story:

Annual yield:

A meager 2.52%

Market loss:

12.85%

Years of
interest lost:

12.85/2.52 = 5.3

Time elapsed: 6 weeks

Conclusion: They lost the equivalent of more than FIVE YEARS OF INTEREST in just SIX weeks.

It was easily among the most disastrous Treasury bond investments of all time! Meanwhile, investors who followed our recommendation to buy strictly short-term Treasury bills didn’t lose a penny.

Now do you understand why we’ve been warning you not to touch long-term bonds with a ten-foot pole? And now do you see why we’ve been working so hard to find other, alternative, depression-proof sources of income and profits for you?

Mike, Larry and I tell you all about these unusual dangers — and unusual opportunities — in our video “7 Startling Forecasts for 2009.”

We explain exactly what we think is going to happen this year and what you should do about it immediately.

And we are extremely gratified with the respons so far: Just in recent days, a grand total of 65,431 individual investors have come to our website to view it.

Don’t be left behind. Especially not in these trying times! Turn up your computer speakers and click on the link below.

http://weiss.streamlogics.com/startlingforecast

Good luck and God bless!

Martin

Warning: The video comes offline Tuesday. So you only have a couple of days left to see it.



About Money and Markets

For more information and archived issues, visit http://www.moneyandmarkets.com

Money and Markets (MaM) is published by Weiss Research, Inc. and written by Martin D. Weiss along with Tony Sagami, Nilus Mattive, Sean Brodrick, Larry Edelson, Michael Larson and Jack Crooks. To avoid conflicts of interest, Weiss Research and its staff do not hold positions in companies recommended in MaM, nor do we accept any compensation for such recommendations. The comments, graphs, forecasts, and indices published in MaM are based upon data whose accuracy is deemed reliable but not guaranteed. Performance returns cited are derived from our best estimates but must be considered hypothetical in as much as we do not track the actual prices investors pay or receive. Regular contributors and staff include Kristen Adams, Andrea Baumwald, John Burke, Amber Dakar, Michelle Johncke, Dinesh Kalera, Red Morgan, Maryellen Murphy, Jennifer Newman-Amos, Adam Shafer, Julie Trudeau and Leslie Underwood.

Attention editors and publishers! Money and Markets issues can be republished. Republished issues MUST include attribution of the author(s) and the following short paragraph:

This investment news is brought to you by Money and Markets. Money and Markets is a free daily investment newsletter from Martin D. Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Dr. Weiss is a leader in the fields of investing, interest rates, financial safety and economic forecasting. To view archives or subscribe, visit http://www.moneyandmarkets.com.

From time to time, Money and Markets may have information from select third-party advertisers known as “external sponsorships.” We cannot guarantee the accuracy of these ads. In addition, these ads do not necessarily express the viewpoints of Money and Markets or its editors. For more information, see our terms and conditions.

© 2009 by Weiss Research, Inc. All rights reserved.

15430 Endeavour Drive, Jupiter, FL 33478

Share Email
Tweet

Previous post: Despite lousy fundamentals, the dollar’s rally will continue

Next post: Warning: Megabanks Could Fail Despite Federal Aid

  • Sign Up FREE

    To receive your Money and Markets FREE investment newsletter subscription, type in your e-mail address. We respect your privacy

  • Advertising

  • Take advantage of our strong track record for safety to guard your wealth in these trying times with our free daily updates delivered to your inbox every morning.
  • Advertising

  • Market Update

    Click an index for a graph of its recent activity:

    U.S.

    Thu 2/09/12, 5:30pm
    Index Last Change
    DOW
    NASDAQ 2,927 +11.4
    NASDAQ
    S&P 500 1,352 +2.0
    S&P 500

    Europe

    Thu 2/09/12, 11:59am
    Index Last Change
    FTSE 100 5,895 +19.5
    FTSE 100
    CAC 40 3,425 +14.7
    CAC 40
    DAX 6,789 +40.0
    DAX

    Asia

    Thu 2/09/12, 1:28am
    Index Last Change
    HANG SENG 21,010 +0.0
    HANG SENG
    NIKKEI 225 9,002 +0.0
    NIKKEI 225
    CSI 300 2,529 +1.0
    CSI 300
  • Advertising

  • Weiss Group Press Releases

    Weiss Ratings: Southwestern Banks Show Signs of Turnaround January 24, 2012
    Weiss Ratings: Sluggish Demand Triggers Downgrades of China, Canada, Saudi Arabia December 19, 2011
    Weiss Ratings: Eurozone Crisis Prompts Debt Downgrades December 9, 2011
    Weiss Ratings: High-End Medigap Plans Available at Basic-Plan Prices December 2, 2011
    Weiss Ratings: Connecticut Seniors Pay Highest Premiums for Medigap Plans October 24, 2011
  • Find us on Facebook

  • Follow us on Twitter

    • Money and Markets on Twitter
    • Money and Markets on Twitter
    • Dr Martin D. Weiss on Twitter
    • Nilus Mattive on Twitter
    • Ron Rowland on Twitter
    • Mike Larson on Twitter
    • Jack Crooks on Twitter
  • Weiss Ratings - Top-Rated Banks, Credit-Unions, Insurers

  • Weiss Research Affiliate

  • About Us
  • FAQ
  • Legal
  • Privacy
  • Whitelist
  • Advertising
  • ©2012 Money and Markets. All Rights Reserved.
Weiss Research, Inc., founded in 1971, has a long history of providing research and analysis designed to empower investors with information and tools to make more informed, independent decisions along with an equally long history of public service. [More »]