Best Financial Advisors in Sacramento, CA

With Inflation and Rates Sky High, Should You Consider Bonds to Buy? 2022 is well on its way to being one of the worst years in modern history for bond (also known as fixed income) investors, ushering in the worst bond market returns since 1973. This begs the question: Are there any decent bonds to buy? Since 1976, bonds have provided a positive annual return in 42 of 46 years. Unfortunately for bond investors, 2022 has been a huge anomaly. Prior to 2021, we experienced an unprecedented 30+ year period of low inflation and declining interest rates here in the United States. However, 2022 has been a stark reversal, as the worst inflation we have experienced in nearly 40 years has forced global central banks to aggressively increase interest rates in an attempt to combat rising prices and overheated economies. The United States Federal Reserve (“the Fed”) has been an active participant in this “tightening,” taking its benchmark federal funds rate from 0.25% at the beginning of the year to 3.25% today, after it boosted it again by 0.75% on Wednesday, the third straight ¾ point increase in 2022. Read our most recent Trending Today newsletter for more information.