FAST FIVE: Here Is The Treasury's (Not So) Secret Trade Printing Millions In Guaranteed, Risk-Free Profits Every Day
But wait, the US doesn't have negative yields, at least not yet, so why are Bills trading below zero.
Take the following example picked by Boomberg: on Thursday, the Treasury sold $60 billion of four-week bills at the minimum allowed rate of 0% (at a price of par, or 100 cent on the dollar).
However, according to Bloomberg, it never followed through and changed its policy.
And “philosophically, I am just opposed to investors paying the US government to hold their debt.
But what happens when, not if, the crisis returns and investors have no choice but to park trillions into the “safety” of the Bill market sending yields far below zero and on a rather “permanent” basis.