# 🍠 Treasury Note

By [Let Them Eat Cake](https://paragraph.com/@ltecake) · 2022-06-21

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**TL,DR: Like a yam, treasury notes elicit the shrug reaction**

Treasury Note / Yam

*   medium shelf life
    
*   safe and full of nutrients
    

Eatamology

Issued by the Treasury, “Notes” are named for sheets of paper they were originally issued on during the War of 1812 and again to fund the Mexican-American war. Formally, the Treasury Note Act of 1812 together with the Sherman Silver Purchase Law cemented the term Treasury Note into history. The government used the money from the Notes to buy 4.5 million ounces of silver per month.

Financials

Notes mature in 1 to 10 years and are backed by the “full faith and credit” of the U.S. government, just like bills. They trade at auction or on the secondary market. Unlike bills, they have longer maturity, and compensate investors for holding the product longer by offering them slightly higher interest rates. With longer maturity and higher coupons comes a higher duration, which is a complex financial calculation that indicates the sensitivity of a fixed income product’s price to interest rate changes, and is only really understood by industry professionals. Due to the longer maturity, notes are exposed to interest rate risk. Imagine you own a 10 year bond paying 1% interest semi-annually. If interest rates rise to 2%, and investors can now buy 10 year bonds that pay 2% semi-annually, the value of your product will decline.

Nutrition Facts Price: Par Issue Frequency: bi-weekly Issue Size: Maturity: Medium Interest/Coupon Amount: Low - Medium Coupon Type: Fixed or Zero Yield: Low - Medium Tax Status: Tax Exempt

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*Originally published on [Let Them Eat Cake](https://paragraph.com/@ltecake/treasury-note)*