U.S. Savings Bond rates change November 3: Are they really a 'safe' investment?

With the change of the Savings Bond rates quickly approaching on November 3, and the recent roller-coaster in the stock market, perhaps we should stop for a moment to answer the age old question: Are U.S. Savings Bonds really a 'safe' investment?

Compare it to the Dow Jones year-to-date return, which is down almost a third, and you'll find that your U.S. Savings Bond, whether it's a Series EE or I, is starting to look like not only a safe investment, but a far more profitable one as well.

Turn back the clock five years and you'll find an even bigger surprise, that stodgy war-time inspired bond has netted you almost $20 for every $100 you've put in. Push that up against the five-year return on the Dow, down more than 9%, and that Savings Bond has gone from the B-list of noteworthy money-makers to having its own star on the Wall Street Walk of Fame.

But why doesn't the lonely Savings Bond see headlines? Why isn't everyone and their mother raving about its earnings? Because it's not a sexy investment. There's no risk in putting your money into the hands of "the full faith and backing" of the U.S. Government. Or is there?