SINCE THE ACCORD between the Federal Reserve and the Treasury Department was declared in 1951, interest rates and, therefore, prices of fixed income securities have fluctuated sharply. While the secular trend in bond prices has been downward since 1946, impressive but brief price advances have occurred. As a consequence, the management of a fixed income portfolio has become a hazardous business, with timing shifts in the maturity distribution of an account taking on increasing importance. Not only have absolute changes in prices of bonds been severe but, more significantly, relative price changes between securities of different maturities have been even more volatile. The standard bond basis book demonstrates the affect of maturity on the price action of a bond. The axiomatic conclusion drawn from this investment fundamental is that the longer the bond the wider the price change is likely to be when compared with shorter term securities. The assumption implied is that for an equal change in yield longer term securities will register sharper price changes than shorter bonds. In reality, however, we find in the market place that yields do not change equally among various term obligations. On the contrary, the shape of yield curves in periods of easy money has tended to look quite different than yield curves in a tight money market. That this phenomenon exists-or more precisely, has existedthere can be little doubt. Examine the June 1953 U. S. Government market yield curve relative to the curve emblematic of the 1954 easy money period. (Chart I) Similarly, inspection of the yield curves for the 19571958 periods also point up the fact that 10-year obligations have moved over a wider range than longer term securities. (Chart II) Expressed in price changes the shifts in value of intermediate and longer maturities highlight the practical aspects of this bond market characteristic. It might be well to examine more closely what did occur in the U. S. Government bond market since 1953.