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Subject:  Time to buy? Date:  9/5/2007  11:41 AM
Author:  WendyBG Number:  21518 of 36729

Income Investors Rediscover Bonds
Market Rout of Recent Weeks Has Boosted Yields to Levels
That Are Irresistible to Some; Locking In at 9.03%
Wall Street Journal, September 5, 2007; Page D1

A flood of selling by hedge funds and institutional investors has depressed the prices of a wide variety of bonds in recent weeks. Now, individual investors are being lured by the attractive yields on many of these income-generating investments.

As prices have declined on many bonds, ranging from investment-grade corporate issues to high-yield, or junk-rated, municipal bonds, their yields have gone up. Some bonds with good credit quality are offering yields as much as half a percentage point above where they were just a few weeks ago, while yields on junk-rated issues are up as much as two or three percentage points....

There are risks, of course, to stepping back into the bond market when prospects for the economy remain uncertain.
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I have been considering a low-cost investment grade bond fund, such as Vanguard Long-Term Investment-Grade Fund Investor Shares (VWESX), which currently yields 6.06%.


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