Latest news with #bonds
Yahoo
an hour ago
- Business
- Yahoo
Robert Kiyosaki Warns That Bonds Aren't ‘Safe' — Do Experts Agree?
Recently, the writer of 'Rich Dad, Poor Dad' Robert Kiyosaki posted on X that 'only chumps' would believe bonds are a safe investment. Kiyosaki went on to say that bonds come with counter-party risk and that the only truly safe investments are gold, silver and Bitcoin. Kiyosaki called everything else 'toilet paper.' Discover Next: Read Next: Is this true? GOBankingRates reached out to other financial experts to find out their takes on Kiyosaki's statements. Read on to see what the consensus is on whether bonds are a safe investment or not. Kiyosaki's statement about bonds doesn't take into account the different types of bonds. 'Not all bonds are created equal,' explained Drew Stevens, president of Wisdom to Wealth. 'Treasuries, municipal and corporate bonds serve different purposes and react differently to market stressors.' Treasury bonds are issued by the U.S. government, so their value is guaranteed so long as their government is standing, but the interest they deliver may waver if interest rates rise (which they have been doing). These are the types of bonds Kiyosaki is likely referring to in his argument. Trending Now: Municipal bonds are issued by state and local governments. They also offer appealing rates to investors. However, if the government were to go bankrupt, then the bond's value is not guaranteed. Corporate bonds are issued by businesses. The value of these, as you might have guessed, really depends on the strength of the corporation that issued them. However, because of this inherent risk, the ultimate yield can sometimes be extremely high in comparison with the other bonds. If passed in its current state, President Donald Trump's 'One Big Beautiful Bill' would add $2.4 trillion to the deficit. Financial expert and strategist David Lester said that amount of debt might cost bond investors — specifically treasury bonds. 'As U.S. debt increases, lenders — including foreign governments and institutional investors — may begin demanding higher yields to compensate for the perceived risk,' Lester said. 'Should that happen, older treasury bonds offering lower yields could lose appeal, as new issuances offer more competitive rates. So Robert is most likely correct about staying away from bonds if the bill passes.' If investors want to look into bonds, one option that would be protected against the mounting national debt is an inflation-protected bond. 'These instruments adjust both the principal and the interest with the consumer price index, so the real value of the payment stream stays intact,' explained Sami Andreani, finance expert and chief financial officer at Oppizi. 'The trade-off is a smaller starting yield, yet many households decide the shield against inflation is worth the lower current income.' The majority of experts agreed that bonds should just be one piece of your financial portfolio. 'Labeling all bonds as 'unsafe' is a sweeping generalization,' Stevens said. 'Bonds, like any asset class, require context and strategy. When used properly, they can still play a critical role in portfolio diversification and capital preservation, especially for conservative investors or those nearing retirement.' Noam Korbl is a personal finance expert in addition to co-founder and chief operating officer at PropFirms. Korbl stressed that bonds are not meant to be a some get-rich-quick scheme, but rather a tool to weather volatility in shaky markets. 'In the last decade, even through inflation and central bank shifts, treasury bonds have delivered average annual returns around 3% to 4%, depending on duration. That might not impress crypto enthusiasts, but for pension funds and people nearing retirement, that consistency matters,' Korbl explained. Korbl added that bonds come with many tax advantages as well. 'In certain states like Florida or Texas where state income tax is zero, interest from federal bonds comes in clean. Municipal bonds go even further with triple-tax-free status in the state they're issued,' Korbl said. More From GOBankingRates Mark Cuban Warns of 'Red Rural Recession' -- 4 States That Could Get Hit Hard 6 Big Shakeups Coming to Social Security in 2025 The 5 Car Brands Named the Least Reliable of 2025 This article originally appeared on Robert Kiyosaki Warns That Bonds Aren't 'Safe' — Do Experts Agree?
Yahoo
an hour ago
- Business
- Yahoo
Robert Kiyosaki Warns That Bonds Aren't ‘Safe' — Do Experts Agree?
Recently, the writer of 'Rich Dad, Poor Dad' Robert Kiyosaki posted on X that 'only chumps' would believe bonds are a safe investment. Kiyosaki went on to say that bonds come with counter-party risk and that the only truly safe investments are gold, silver and Bitcoin. Kiyosaki called everything else 'toilet paper.' Discover Next: Read Next: Is this true? GOBankingRates reached out to other financial experts to find out their takes on Kiyosaki's statements. Read on to see what the consensus is on whether bonds are a safe investment or not. Kiyosaki's statement about bonds doesn't take into account the different types of bonds. 'Not all bonds are created equal,' explained Drew Stevens, president of Wisdom to Wealth. 'Treasuries, municipal and corporate bonds serve different purposes and react differently to market stressors.' Treasury bonds are issued by the U.S. government, so their value is guaranteed so long as their government is standing, but the interest they deliver may waver if interest rates rise (which they have been doing). These are the types of bonds Kiyosaki is likely referring to in his argument. Trending Now: Municipal bonds are issued by state and local governments. They also offer appealing rates to investors. However, if the government were to go bankrupt, then the bond's value is not guaranteed. Corporate bonds are issued by businesses. The value of these, as you might have guessed, really depends on the strength of the corporation that issued them. However, because of this inherent risk, the ultimate yield can sometimes be extremely high in comparison with the other bonds. If passed in its current state, President Donald Trump's 'One Big Beautiful Bill' would add $2.4 trillion to the deficit. Financial expert and strategist David Lester said that amount of debt might cost bond investors — specifically treasury bonds. 'As U.S. debt increases, lenders — including foreign governments and institutional investors — may begin demanding higher yields to compensate for the perceived risk,' Lester said. 'Should that happen, older treasury bonds offering lower yields could lose appeal, as new issuances offer more competitive rates. So Robert is most likely correct about staying away from bonds if the bill passes.' If investors want to look into bonds, one option that would be protected against the mounting national debt is an inflation-protected bond. 'These instruments adjust both the principal and the interest with the consumer price index, so the real value of the payment stream stays intact,' explained Sami Andreani, finance expert and chief financial officer at Oppizi. 'The trade-off is a smaller starting yield, yet many households decide the shield against inflation is worth the lower current income.' The majority of experts agreed that bonds should just be one piece of your financial portfolio. 'Labeling all bonds as 'unsafe' is a sweeping generalization,' Stevens said. 'Bonds, like any asset class, require context and strategy. When used properly, they can still play a critical role in portfolio diversification and capital preservation, especially for conservative investors or those nearing retirement.' Noam Korbl is a personal finance expert in addition to co-founder and chief operating officer at PropFirms. Korbl stressed that bonds are not meant to be a some get-rich-quick scheme, but rather a tool to weather volatility in shaky markets. 'In the last decade, even through inflation and central bank shifts, treasury bonds have delivered average annual returns around 3% to 4%, depending on duration. That might not impress crypto enthusiasts, but for pension funds and people nearing retirement, that consistency matters,' Korbl explained. Korbl added that bonds come with many tax advantages as well. 'In certain states like Florida or Texas where state income tax is zero, interest from federal bonds comes in clean. Municipal bonds go even further with triple-tax-free status in the state they're issued,' Korbl said. More From GOBankingRates Mark Cuban Warns of 'Red Rural Recession' -- 4 States That Could Get Hit Hard 6 Big Shakeups Coming to Social Security in 2025 The 5 Car Brands Named the Least Reliable of 2025 This article originally appeared on Robert Kiyosaki Warns That Bonds Aren't 'Safe' — Do Experts Agree?
Bloomberg
20 hours ago
- Business
- Bloomberg
Fortress $2 Billion Property Bond Likely to Miss Payment Date
A corporate entity tied to Fortress Investment Group warned investors that it will likely miss a key deadline to refinance about $2 billion of bonds backed by warehouses leased to according to people familiar with the matter. Fortress is 'actively working on a solution for refinancing' the debt as a key July 15 repayment date approaches, the company said in a note to bondholders on Thursday seen by Bloomberg.
Reuters
a day ago
- Business
- Reuters
State Bank of India likely to tap debt market by Aug via tier II issue, sources say
MUMBAI, June 27 (Reuters) - State Bank of India ( opens new tab is likely to kick off a debt fundraising cycle for state-run lenders in this fiscal year over the next couple of months, with a Basel III-compliant tier II bond issue, three sources familiar with the matter told Reuters on Friday. India's largest lender is looking to raise about 50 billion rupees ($584.59 million) through those bonds, with a 10-year or 15-year maturity in July or August, the sources said. SBI did not immediately respond to a Reuters request for comment. The sources declined to be named as they are not authorised to speak to the media. "The initial level talks have already started, but the duration would be finalised looking at the rates at the time of issuance and investors' interest," one of the sources said. The source further added, SBI could also explore a 15-year structure with a call option at the end of 10 years, like its previous issue. In September, the bank had raised 75 billion rupees through 15-year tier II bonds, which had a call option at the end of 10 years. In the previous financial year, SBI had raised 150 billion rupees through tier II bonds. SBI has not tapped the bond market in the first half of 2025 and shelved a plan to issue infrastructure bonds in March due to elevated yields. No other state-run lender has tapped the debt market in the first quarter of this financial year that started on April 1. ICICI Bank is the only lender to tap the bond market. It raised 10 billion rupees through 15-year tier II bonds earlier this week, with a call option at the end of 10 years at a 7.45% coupon. ($1 = 85.5300 Indian rupees)
Bloomberg
2 days ago
- Business
- Bloomberg
Funds Flexing 60/40 Playbook Become Investor Favorites in India
Indian funds that offer built-in diversification by combining stocks with assets such as bonds and gold lured in more money than pure equity ones last month for the first time in a year, pointing toward a potential long-term investment shift. The so-called hybrid plans attracted a net 208 billion rupees ($2.4 billion) of inflows in May, while stock funds garnered just 190 billion rupees, according to data from the Association of Mutual Funds in India. The switch comes as global geopolitical turmoil escalates and Indian equities trail their worldwide peers amid concern over weaker earnings growth.
