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But rates on long-term Treasury securities have fallen.
Expansionary open-market operations featuring long-term Treasury bonds (QE2) might be expansionary.
The last time long-term Treasury bonds yielded 2.1% was in 1949.
It said that it would continue to buy long-term Treasury securities until year's end.
Long-term Treasury yields are already down to 1.7%, near the lowest ever recorded.
"The ones to avoid are the long-term Treasury funds," he said.
Since the start of December, municipal, foreign and long-term Treasury bond funds have lost value, on average.
The purchases drive down interest rates by reducing the supply of assets like long-term Treasury securities.
This price surge has turbocharged long-term Treasury mutual funds, despite the paltry yields of the underlying bonds.
The Fed's current commitment to buy $400 billion in long-term Treasury securities is scheduled to end this month.
To be sure, people holding long-term Treasury bonds should expect to bear some losses if interest rates rise.
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