[Paladin2]

"If inflation is -2%..."

[ConservativeMind]

You call your bonds and reissue them.

[Maine Mariner]

Good point. The real rate of interest, r = i + inflation rate when i is the nominal or stated interest rate you receive. So if i = 0 and the inflation rate is -2% (deflation actually), the real rate of return is +2% not counting taxes on the interest income.