30-year U.S. Treasury bonds - why is it coming back now and who wants it.

**The last sales of 30-year bonds, known as the "long bond," were made in August 2001. On Oct, 31, 2001, then-Treasury Under Secretary Peter Fisher announced: "We do not need the 30-year bond to meet the government's current financing needs, nor those that we expect to face in the coming years."

**At the time, Treasury was stepping up its short-term borrowing in the wake of Sept. 11, 2001, terror attacks that had deepened an economic downturn and helped wipe out a brief period of budget surpluses. But Treasury maintained it did not need the bond because it felt the long-term budget outlook was strong.

**Since then, U.S. budget deficits have continued to soar as wars in Afghanistan and Iraq and relief to hurricane-hit U.S. Gulf Coast states have climbed, leading to a projected $423 billion deficit for fiscal 2006 ending Sept. 30. On May 4, 2005, Treasury said it was considering bringing the long bond back to give it a broader borrowing range. "We're doing this, really, because times have changed," said Treasury Assistant Secretary Timothy Bitsberger.

**Sales of 30-year bonds started in 1977 to create a very low-risk debt instrument. The bond became a risk-free gold standard by which much private-sector debt was priced. While the size of auctions shrank in the late 1990s and the early part of this decade, making it less of a benchmark for setting other interest rates, it is still highly prized by investors ranging from individuals to pension funds that want or need it to add certainty to long-term planning.