Quora Answer: What are the Ways to Invest Money in US Government Bonds at a Good Interest Rate?

The following is my answer to a Quora question: “What are the ways to invest money in US government bonds at a good interest rate?”

But why?  The US national debt has crossed US$36 trillion.  Approximately half of every annual budget deficit now goes toward interest expenses alone.  The Congressional Budget Office projects debt-to-GDP reaching 122% by 2034.  The US government spent US$1.1 trillion on interest payments in fiscal year 2025 — more than it spent on defence, more than Medicare, more than any single programme in the federal budget.

A sovereign spending half its deficit financing on interest costs is not AAA credit in any meaningful sense.  It is AAA credit by historical inertia and the absence of a better alternative — two very different things.  Moody’s downgraded the United States from AAA to Aa1 in May 2025.  The surprise was how long it took.

The dollar’s share of global foreign exchange reserves has fallen from 71% in 1999 to 56.3% in mid-2025.  That is fifteen percentage points of reserve share lost over twenty-five years.  Each percentage point represents central banks substituting something else — euros, yuan, gold, Singapore dollar — for Treasuries.  Each substitution marginally reduces external demand for US government debt and marginally increases the structural cost of financing the deficit.

The weaponisation of dollar assets in 2022 — freezing approximately US$300 billion in Russian sovereign reserves — sent an unambiguous signal to every non-aligned central bank globally: dollar holdings are a geopolitical liability, not merely a financial position.  The response has been consistent.  Central banks purchased over 1,000 tonnes of gold annually for three consecutive years.  Gold overtook US Treasuries in total central bank reserve holdings in early 2026.  The US government did not cause de-dollarisation.  It accelerated it.

German Bunds carry equivalent credit quality with euro exposure — a currency that is not subject to weaponisation risk and represents the world’s largest trading bloc.  Eurozone fiscal integration is deepening, expanding the depth and liquidity of European sovereign debt.

Singapore Government Securities yield 3.2% to 3.8% in a currency with a structural appreciation bias, AAA sovereign credit, and zero geopolitical risk attached to holding them. For any internationally mobile investor, Singapore dollar assets provide real returns that US dollar assets — subject to dollar depreciation — do not reliably deliver.

Norwegian Government Bonds offer AAA-rated sovereign debt from a country running a persistent fiscal surplus and managing the world’s largest sovereign wealth fund at approximately US$1.7 trillion.  Norway does not have a debt problem.  It has the opposite.

Australian Commonwealth Government Securities offer AA-rated sovereign debt in a commodity-linked currency with structural demand from Asian trading partners.  Australia’s fiscal position, while not pristine, is materially stronger than that of the United States.

Gold itself — not a bond, but the asset central banks are substituting for Treasuries — has appreciated from approximately US$1,800 per troy ounce in early 2022 to forecasts of US$5,400 to US$7,200 by end-2026 across major bank projections.  The structural floor is an institutional demand that does not respond to price.

The United States reports a GDP of approximately US$29 trillion.  This number is real.  It is also deeply misleading as a measure of economic health.  US GDP is approximately 77% services: financial services, healthcare, legal services, real estate transactions, and insurance dominate the composition.  These are not exports.  They cannot be shipped to Vietnam, sold to Indonesia, or deployed in a factory in Malaysia.  They measure Americans paying each other for intangible services — and count it as economic output equivalent to manufactured goods.

US manufacturing has declined from 28% of GDP in 1953 to under 11% today.  The US produced 40% of global manufacturing output in 1945.  It produces approximately 16% today.  China produces approximately 29%.  Manufacturing matters because it produces exportable goods, builds supply chain resilience, generates productivity growth through process innovation, and creates employment that sustains broad-based consumption.  Financial services GDP is largely non-tradeable, non-exportable, and entirely dependent on the reserve currency status, which makes New York the global financial clearing centre.

The US trade deficit in goods ran at approximately US$1.1 trillion in 2024.  The US imports the manufactured goods it no longer produces.  It pays for those imports partly by exporting financial services — and partly by issuing Treasuries that the world buys because the dollar remains the reserve currency.

The dollar reserve status funds the trade deficit, which reflects manufacturing hollowness, which requires reserve status to continue.  When reserve status erodes — as it demonstrably is — the funding cost rises, the trade deficit becomes harder to finance, and the GDP composition problem becomes a solvency problem in slow motion.

The investor who reads US GDP at US$29 trillion and concludes the economy is structurally sound is reading a document written by a country that counts its lawyers, its hospital administrators, and its derivatives traders as productive output — and has been reassuring itself with that document for thirty years while its factories relocated to Shenzhen.

Buy US Treasuries if the yield, duration, and currency exposure suit your specific portfolio.  They remain the world’s most liquid sovereign debt instrument — a genuine and meaningful advantage.  A 4.5% yield on the 10-year is not nothing.  But do not mistake liquidity for safety.  Do not mistake yield for value.  And do not mistake a US$29 trillion GDP built predominantly on services for the productive economic base of a country that can sustain indefinite deficit financing at current rates.  The world’s reserve managers have already stopped making those mistakes.  Retail investors are usually the last to receive the memo.

Terence Nunis | Executive Chairman, Equinox Zenith | Author, The 1% Playbook: The Billionaire Cheat Code