<prompt> Human: I was watching Bill Maher and the head of the FDIC was on there. She brought up how there is a bond bubble and this makes sense. Many people are buying bonds now just because theyve heard its safer, but since everyone is doing it and interest rates are basically 0.0, the prices of bonds has to be inflated. If there is any interest rate increases, wouldnt this bring the price of bonds down and burst the bubble since many who bought the bonds will all sell because they fear losses? What are your thoughts on this bubble? I think this goes to show how important it is to know what youre investing in and be informed. Sure bonds are generally safe, but theres still a time when a bonds price may be too high and you have a higher probability of losing money! More important question that I wanted to ask you guys. Should this be the exact reason I shouldnt put my emergency fund in any bonds, including I-Bonds? Since interest rates can only go up at this point, I figure I could just wait a few years and buy better priced bonds. I assume I-Bonds work the same as any other bond where if I purchase now and the interest rate increases to 0.5, Im still stuck with the 0.0.Also for those who didnt know, you can now put 10,000 in I-Bonds a year through TreasuryDirect since they want to go the electronic route. They changed that January 1, 2012!TL;DR: Because of a potential bond bubble, is putting my emergency bonds in I-Bonds at this point in time unwise?  <response>: I assume I-Bonds work the same as any other bond where if I purchase now and the interest rate increases to 0.5, Im still stuck with the 0.0Why dont you just look it up instead of assuming?Theres a fixed component of the bond rate that is currently 0 and will be for the life of your bonds if you buy now, but there is another component that varies with inflation and gets adjusted every 6 months. It is currently 2.2, which is much more than you could get in a savings account. But bear in mind that you cant redeem them for one year after purchase, so dont put your whole emergency fund in I-bonds. 