While people are still worried about government deficits, rising federal debt, and the possibility of hyperinflation, yields on Treasury obligations are approaching record low levels. Worse, in all short-term maturities the yield is lower than the rate of inflation. Today, for instance, the yield on a 10-year Treasury is 1.70 percent— about the same as the trailing rate of inflation.
The risk that interest rates will rise is now greater than the opportunity of a continued decline. More important, the losses could be significant. http://assetbuilder.com/scott_bur...is_in_bond