Thursday, March 26, 2009

Obama's Unexpected New Income Stream: Treasury Yield Goes Negative

It won't last, and it's not really an income stream for the government, simply an affect of trading between large mutual funds who are forced to buy because everyone is selling their stocks mutual funds in their 401k and buys short term treasuries. The sad result - negative yield. No one earns a dime from this, everyone loses.
One Month Treasury Yield Goes Negative Again
While the equity rally is helping some investors feel like we are returning to something resembling a sense of normalcy, a look at the yield on the 30-Day US T-Bill shows that things are anything but normal in the credit markets. For the first time this year, its yield dipped back below zero this morning. Now the government is even taking money from people who want to loan it money!

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