Allison Schrager, Columnist

Three Myths About the Bond Market

The era of declining interest rates may have come to an end, and many investors don’t seem to realize it.

October 5, 2023 at 9:30 AM UTC

Allison Schrager is a Bloomberg Opinion columnist covering economics. A senior fellow at the Manhattan Institute, she is author of “An Economist Walks Into a Brothel: And Other Unexpected Places to Understand Risk.”

Not as safe as it used to be.
Photographer: Stefani Reynolds/Bloomberg

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For the last 40 years, interest rates have gone pretty much one way: down. In the last 18 months, however, rates have crept up, and many are worried they will stay high. In other words: Reality is catching up with the bond market — and with the myths that have grown up around it. Here are three of those myths.

Myth 1: Safe bonds are also risk-free bonds.