As Long Bonds Get Longer,Do They Get Riskier?

A 50-year bond, you say? Hmmm. In 1943, a ticket to see Casablanca cost a quarter, and 30-year Treasury bonds paid out 2.5%. In 1993, admission to Jurassic Park is $7 or more, and the long Treasury yields 6.8%. In 2043, we may be creating our own movies via virtual reality and...well, who knows where interest rates will be? Nevertheless, a small yet growing group of major corporations is hawking 50-year bonds to lock in today's (relatively) low rates.

To continue reading this article you must be a Bloomberg Professional Service Subscriber.