[quote=4plexowner]so if I invest in a $1000 bond that pays 3.5% and I hold that bond for 10 years in an environment where monetary debasement (inflation for you plebes) is 5% per year, how much am I ahead at the end of those 10 years?
[/quote]

That would be a pathological and unstable situation. As you can see in this chart, in the last half century CPI growth rate only exceeded the 10-year yield twice, both times briefly: