Bonds

How Do Tax Exempt Bonds Work?

Every state has a state-chartered bond authority. Healthcare facility authority, housing finance agencies, higher education facility authorities, and industrial development finance authorities are all examples of these. Energy efficiency retrofits for existing facilities owned by eligible borrowers are among the projects that are eligible for those powers. The federal tax code defines the following individuals […]

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How Do T-Bonds Work?

Treasury bonds (T-bonds) are fixed-rate debt instruments issued by the United States government with maturities ranging from 10 to 30 years. T-bonds pay semiannual interest until they mature, at which point the owner receives the face amount of the bond. Treasury bonds are one of four essentially risk-free government-issued securities, along with Treasury bills, Treasury

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How Do TIPS Bonds Work?

TIPS (Treasury Inflation-Protected Securities) give inflation protection. As assessed by the Consumer Price Index, the principal of a TIPS increases with inflation and falls with deflation. When a TIPS matures, the adjusted principal or the original principal, whichever is greater, is paid to you. TIPS pay a fixed rate of interest twice a year. Because

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How Do Treasury Bonds Affect Interest Rates?

Economic development, competing currencies, and hedging options are all reasons that drive demand for Treasuries. Remember that anything that increases demand for long-term Treasury bonds tends to lower interest rates (higher demand = higher price = lower yield or interest rates), while anything that decreases demand for bonds tends to raise interest rates (lower demand

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