Preservation of Principle

UNITED STATES TREAS BDS

7.50000% 11/15/2024

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Pay Frequency SEMI-ANNUALLY Coupon 7.500 Maturity Date 11/15/2024 Moody's Rating AAA S&P Rating -- Call Protection YES Bond Type Treasury Interest Accrual Date 08/15/1994 Original Issuance     Issue Date 08/11/1994 Dated Date 08/15/1994 First Coupon Date 11/15/1994 Next Coupon -- Last Coupon 05/15/2024 Workout Date 11/15/2024 Issue Price -- Coupon Features Coupon Type FIXED Current Rate Effective Date 08/11/1994

Wow.  1994 wasn't all that long ago.  This 30 year bond would have cost you 100 then.  Now, with only 11 years left in the term you would have to pay 158.  So you'll get 11 payments of 7.5 and then 100 back in the year 2024.  No thanks.

Anyway, the lesson?  What goes up can come down.  USTs are not preservation of principal.  

 Yes, the correct usage is principal and the title of this post uses principle.  Think about the principles of any investment advisor recommending "safe as treasuries."