by Rick Ackerman
U.S. Treasury Bonds have been in a bull market for 35 years as interest rates have fallen from a high of nearly 15% in 1981. Investors who have stuck with long-term U.S. debt have reaped very substantial capital gains as a result. But with yields on the 30-year at a current 2.63%, how much lower can they go? Our friend Doug Behnfield, a Colorado-based financial adviser whose thoughts have been featured here many times before, believes there is still room for further gains. He explains why below in a letter to his clients that focused on two of his favorite investment vehicles: closed-end municipal bond funds and long-term zero-coupon bonds. This is must reading for anyone eager to understand how these vehicles work. For our part, we see long-term U.S. rates falling over the next 2-3 years to an epochal low of 1.64%. If this comes to pass, holders of long-term Treasury debt will do very well indeed.