This article is adapted from Worth the Risk: The Seven Myths That Keep Us From Taking the Chances We Need to Take by Allison Schrager, to be published by Yale University Press. Copyright © 2026 by Allison Schrager. Excerpted by permission. All rights reserved.
What does Tina Turner have in common with a US Treasury bond? They both show that the meaning of safety is not always straightforward.
Born into poverty in rural Tennessee, Anna Mae Bullock sang in the church choir as a child and eventually made her way to the St. Louis music scene, where she became a teen mother and married a band leader who already had two children of his own. They started singing together and became rich and famous, traveling the world as the duo Ike and Tina Turner.
See more: Investment-Grade Corporate Bonds Are Offering Real Income. That's Not Why You Should Be Nervous.
Before long, however, the relationship turned abusive, both emotionally and physically. Tina eventually summoned the courage to leave Ike Turner in 1976. You might think that a divorced woman, especially of that era, would need money to feel safe — and she was certainly entitled to plenty of it, having created hits like Proud Mary with him. But Tina Turner made a surprising decision during the divorce proceedings: She said she didn’t want the assets from the marriage, including royalties from the songs she made famous. She left with nothing except custody of the four children, two cars, and the right to keep using her stage name.
Tina Turner chose her name over money in the bank because she knew that doing so would make her feel safer. The assets she left behind were part of a life in which she didn’t feel safe. It wasn’t clear if her decision would work out in her favor, and those first few years were very difficult. She went on food stamps, and her career did not seem to be going anywhere as she approached middle age. But in her mid-forties, Turner released the album Private Dancer, which went multi-platinum and made her an even bigger international superstar than when she was married.
Money in the bank might seem like a universally safe concept — especially to Americans accustomed to the government insuring their deposits. But the idea that a universally safe investment or situation exists and can protect your future is a myth that prevents many people from taking risks like Turner did.
Safety isn’t a real place. It’s a feeling. It’s deeply personal, and it can change with your life circumstances. What you need to feel safe is not what someone else needs. What’s safe in one era doesn’t feel so safe in the next. But defining your personal feeling of “safety” is key to making good decisions about risk.
For Turner, her name meant her career and identity, which felt more secure than money from the past. What you see as safe defines how you perceive, value, and take risks. In financial economics, what safe means depends on your goals.
For example, we think of bonds as a safe investment. But not all bonds are a safe way to meet your goal. If you are saving for the long term, like for retirement, a long-term bond will likely protect your money from all the changes that will happen in markets over the decades, especially if it is inflation-protected. Yet a long-term bond still has risk: Because its price fluctuates more than a short-term bond’s, its market is less predictable in the near term. Only if you are investing to feel safe several decades from now, and no sooner, are you assured of long-term security.
If your personal definition of safety is long term, beware that the financial industry usually defines a safe asset as something different: one that offers a certain rate of return each year, and can be sold whenever you need it for at least what you paid for it. The industry regards a US Treasury bill (a short-term government bond) as a safe asset since it is backed by the government and its price doesn’t change. This makes sense if you are saving for an upcoming vacation or are a company with extra cash waiting a few months for the right investing project.
The distinction is important because bonds are how the financial industry values safety, and by extension how it defines risk. And yet it gets what’s safe wrong all the time by choosing the wrong bonds as safe and by assuming that bond prices don’t change as much as they do. Price changes in the bond markets tell us more about the state of risk and the economy than any other asset, because bonds represent the current price of safety. To be precise, the price of the “risk-free asset,” as US Treasury bonds are colloquially referred to, appears in almost every asset-pricing formula used in finance; it is the standard of how all risk is priced. It influences bank rates for loans to individuals, and it is used as collateral. It is the single most important asset in finance. The development of sovereign debt markets is one reason that Europe is thought to have industrialized first, and why the North prevailed during the US Civil War.
Most important, the value of US Treasury bonds has changed over time, as the way we view safety has evolved. Mirroring how we have come to value safety ever more highly, the price of a risk-free bond has been rising over time. And the more a bond costs, the lower the rate of interest paid to the bond holder.
Why did safety become so expensive (and thus yields so low)? There are many reasons, and some have been more important at different points in time. For most of history, these bonds were not really that safe, and gold was considered the ultimate risk-free investment. Now it is US Treasury bonds. Someday, though probably not anytime soon, it could be another country’s bonds or even German renewable energy stocks. No one knows. Anything can happen.
The idea that a relatively young country’s sovereign debt could be considered risk-free would have been unthinkable a century ago. For most of history, governments had problems paying debt or inflating it away. Rates of bonds trended down partly because the asset became safer and more valuable as governments got richer and more stable. Once they did, they had no need to offer high rates to entice buyers.
But events over the past several decades have proven especially telling when it comes to our mounting risk aversion. As the demand for safety increased across all parts of our lives—from the removal of seesaws on children’s playgrounds to everything else—the price of low-risk assets increased. After the 1997 Asian financial crisis, many countries wanted to reduce their risk exposure. So they bought lots of safe bonds—those issued by big rich countries like the United States and European Union members. Regulators wanted to ensure less risk in markets and demanded that financial institutions hold more low-risk assets. This created more demand for bonds, so they got a lot more expensive. It was a low-rate and low-risk time. Inflation was very low and predictable. Bonds from rich countries were the established safe asset of the world, and yields kept falling and falling.
After the 2008 financial crisis, central banks also started to buy many of their own countries’ bonds, which further increased the demand. Tremendous demand for low-risk assets that were in limited supply combined to make them even more expensive. As the price of safety grew significantly, it transformed how financial markets worked because if you wanted to invest in a low-risk asset, it would not return very much.
This sky-high demand for safety in recent years explains why investing in low-risk assets like a government bond or savings bank account earns you so little. It explains why mortgage rates fell—from 13 percent in the 1980s to 3 percent until the early 2020s. It explains why so much money went to crypto or tech startups: if you wanted your savings to grow, you had no choice but invest it in riskier assets. Gone was the time a bank would pay you 8 percent for a twelve-month certificate of deposit; now you are lucky to a get a rate that keeps up (barely) with inflation. If you are pension-fund manager who needs to make a certain return to pay benefits, you turn to risk. Safety has become very expensive.
In short, going into the early 2020s it became cheaper to be on the other side of a risk. It became better to be a borrower instead of a saver. It was cheaper to borrow for mortgages or cars. The low rates also trickled throughout the global financial system, which meant even developing countries, which normally pay a fortune, could borrow at lower rates and so help finance their development. It was also cheaper for businesses to fund an expansion or hire more people. Cheaper debt in many ways makes the world less risky, because cash is readily available from lenders when needed. Alternatively, it is easier to take on leverage, a riskier position. If anything changes suddenly and interest rates increase or the bond market freezes, we are more vulnerable.
What’s happened to the risk-free asset and its impact on financial markets offers a useful metaphor for the rest of the economy and our approach to risk in other areas of our lives. As the world became hungrier for safety, the entire financial system changed. In some ways, the world became safer as we valued safety more — most of the time, anyway.
But in other ways, this shift made us more vulnerable. For example, recessions became more difficult for central banks to counter, because interest rates were so low there was less room to cut rates further to spur new growth. Rates got so low that many investors needed to take on more risk to reach their goals: they became open to assets that seemed safe and offered some extra return. But Greek bonds or mortgage-backed securities turned out to not be as safe as they once appeared.
After decades of falling rates, especially after 2010, bond rates have started to rebound, with rates in the 2020s increasing and current rates seeming to stay higher. This turnaround has surprised many people—even economists. People in the financial industry and government had started to believe that interest rates would either keep falling or at least stand still. We all should have known better. Research on rates over many decades shows that rates still do go up and down, even if they have slowly trended down over the centuries. And it suggests that much of what happened since 2010 was a blip, not a permanent fall.
The price of safety is not stable. It never has and never will be, because how we value it changes over time.
A message from Advisor Perspectives and VettaFi: Discover something new! Click here to register for our upcoming webcasts.
Bloomberg News provided this article. For more articles like this please visit
bloomberg.com.
Read more articles by Allison Schrager
