First bonds are a creature of interest rates. Low interest rate breed high rates and visa versa. Increased wages usually means inflation. Interest rates climb which decreases the value of outstanding bonds. Higher tax means that some investors will go toward municipal bonds which are tax free. The smallest size of
this type of bond is five thousand dollars. That being said the value of a bond (depending on duration) will change in value. High intesrest rates will mean the bond value is reduced, low interest rate means the bond value will increase.
If households expect taxes to increase in the future, they increase their savings. what will happen to the demand for bonds
