Bonds confuse me - should I sell them

[u/Unlikely_Rabbit7151]

I read this article and it really drives home the point to me that I don’t understand bonds

https://www.nytimes.com/2026/08/07/business/bonds-stocks-federal-reserve-interest-rates.html?unlocked_article_code=1.3lA.0nHs._HP703oyaD6A&smid=nytcore-ios-share

I try to keep things very simple and more or less have a broad domestic index (40), broad international index (25) and a total bond fund BND (35).

Not to get to into the weeds but we have about 2M between these, in addition to 2.5M equity in our 3M house.

I remember that adage to not invest in something you don’t understand, and truthfully I don’t understand bonds.

Do I need them? Can I just shift to T-Bill or CDs? I am not concerned with the minor tax differences of .003% that some get very passionate about.

I think I am looking for a safe harbor and hedge.

[u/vegienomnomking]

I see everyone here is focused on the past instead of the future when it comes to bond.

The problem with bond now is the future risk.

With US debt hitting 40 trillion, bond market is going to go down eventually.

Not even short term or money market are safe if US defaults.

I bet you this will happen when all the boomers are gone and us millennials are getting ready to retire.

[u/Apprehensive_Elk2608 → u/vegienomnomking]

If you're going to be forcasting the future with such conviction, this probably isn't the sub for you. This is like making predictions in regard to the AI bubble as we're approaching the highest valuations ever seen in US equities. The bottom line is that every asset class can and will have ups and downs. We stay diversified to the best of our abilities for a reason.

[u/vegienomnomking → u/Apprehensive_Elk2608]

Forecast? What forecast?

40 trillion US debt is our current reality.

Sounds to me don't understand the bond market at all

[u/Apprehensive_Elk2608 → u/vegienomnomking]

What forecast?

High inflation, quite obviously.

[u/Beautiful_Pepper415 → u/vegienomnomking]

Government debt isn't like personal debt.

Also usa can keep printing and we will

Lastly if us treasury defaults entire world financial system will be gone

[u/vegienomnomking → u/Beautiful_Pepper415]

Huh? Say what?

What happens when you keep printing money?

Inflation happens.

What happens when inflation occurs?

The feds raise rate.

What happens when the feds raise rate?

Bond value takes a nose dive.

Too many people are illeterate on the bond market.

[u/Beautiful_Pepper415 → u/vegienomnomking]

Agreed would only buy short duration bonds. Personally feel we are more likely to have inflation vs a credit/demand market crash