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Treasury Bills Trade at Negative Rates
- Text size
Daniel Kruger and Cordell Eddings
Bloomberg
December 10, 2008
Treasuries rose, pushing rates on the three-month bill negative for the first time, as investors gravitate toward the safety of U.S. government debt amid the worst financial crisis since the Great Depression.
- A d v e r t i s e m e n t
The Treasury sold $27 billion of three-month bills yesterday at a discount rate of 0.005 percent, the lowest since it starting auctioning the securities in 1929. The U.S. also sold $30 billion of four-week bills today at zero percent for the first time since it began selling the debt in 2001.
“It’s the year-end factor,” said Chris Ahrens, an interest-rate strategist in Greenwich, Connecticut, at UBS Securities LLC, one of the 17 primary dealers that trade directly with the Federal Reserve. “Everyone wants to be in bills going into year-end. Buy now while the opportunity is still there.”
The benchmark 10-year note’s yield tumbled 11 basis points, or 0.11 percentage point, to 2.63 percent at 4:48 p.m. in New York, according to BGCantor Market Data. The 3.75 percent security due in November 2018 gained 31/32, or $9.69 per $1,000 face amount, to 109 23/32. The yield touched 2.505 percent on Dec. 5, the lowest level since at least 1962, when the Fed’s daily records began.
The two-year note’s yield fell 10 basis points to 0.84 percent. It dropped to a record low of 0.77 percent on Dec. 5.
If you invested $1 million in three-month bills at today’s negative discount rate of 0.01 percent, for a price of 100.002556, at maturity you would receive the par value for a loss of $25.56.
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December 10th, 2008 at 3:58 pm
http://imgs.sfgate.com/c/pictu.....665160.jpg
December 10th, 2008 at 4:48 pm
SalAnthony: Your spamming is the reason the rest of us are not getting our comments posted. f--- off.
December 10th, 2008 at 7:41 pm
I have some “bills” id like to Issue these pricks at a “negative rate” at the end of a rifel barrel.
December 10th, 2008 at 7:53 pm
Hey Alex and Aaron, can’t you block these spammers? Some of us like sharing our ideas. Any way you can put vote button or something to support others’ comments?
December 10th, 2008 at 7:58 pm
Yeah, everythings gonna be allright now.
December 10th, 2008 at 8:20 pm
can’t have it all, ppl complain about the spammers but if they get blocked ppl would just complain that this site is censoring stuff
December 10th, 2008 at 9:08 pm
Jupiter’s ‘Great Red Spot’ and ‘Kris Kringle’ are one in the same.
December 10th, 2008 at 9:32 pm
AJ, will you please filter out that nitwit’s website posted in #1 and #2? The same with that idiot from curecabinet, or whatever the hell it’s called. It’s obvious they are spammers, so no one will accuse you of censorship. Thanks.
December 10th, 2008 at 10:00 pm
“I am a most unhappy man. I have unwittingly ruined my country.
A great industrial nation is controlled by its system of credit.
Our system of credit is concentrated. The growth of the nation,
therefore, and all our activities are in the hands of a few men.
We have come to be one of the worst ruled, one of the most completely
controlled and dominated governments in the civilized world.
No longer a government by free opinion, no longer a government by
conviction and the vote of the majority, but a government by
the opinion and duress of a small group of dominant men.”
Pres. Dr. T. Woodrow Wilson 1913 (source questionable)
Regardless of the academic authenticity of this central source of this quote, is there any doubt to the despairing sentiment of it? The Fed controls the bills of credit, the treasury operates off of these bills of credit, and soon this is going to totally bankrupt us. Once again, irrefutable evidence of my central sentiment of WE ARE f---ED!!!!
December 10th, 2008 at 10:13 pm
“safety of debt”… Now there is a term for you. What idiot is selling that bridge over the Atlantic?
December 10th, 2008 at 10:24 pm
otes on Woodrow Wilson…. Yet it is no secret he was a puppet for advisor Col. House. I also researched Col. House’s father. He was a Southern profiteer during the civil war trading with England and Eirope.. yet he never mad a historicla “radar” mention.. but was powerful in GVT.
http://en.wikiquote.org/wiki/Woodrow_Wilson
December 10th, 2008 at 10:31 pm
#1
Take your spam and shove it.
I too am getting sick of the damn spam with no message postings.
Just like other sites I grew tired of, Maybe it’s time to move on.
It’s bad enough putting up with all the moronic postings, but I won’t put up with spam.
December 10th, 2008 at 11:20 pm
It’s just for investors and people who believe in easy money ( high interest rate world / get a lot of money from stock market) in not existing anymore and ……they just have to learn to get their hands dirty.
December 11th, 2008 at 2:30 am
I didn’t know that about Col. House and his history and connections- that was informative Casual Observer- I learn something new everytime I visit this website, and knowledge is the true power. Kowledge coupled with unity, unity coupled with action and force is the only way those of us who love liberty will prevail.
December 11th, 2008 at 2:39 am
the bail out was short by 20 zeros, dont mean squat, if you think bill gates and buffett are not not leaving their billions to their descendants because of austerity think again its because it does not exist dow used to bury everything we sold them, this is a scam, you are a scam, your mother is a scam, aj is a scam, best of all my dick is a scam
December 11th, 2008 at 2:59 am
Did you know Churches use electrical brainwashing technology to send people into hysterics. This is used by all major churches for artificial “healing” and imprinting beliefs into people’s heads. (LRAD and ELF technology).
December 11th, 2008 at 5:11 am
this economic crisis is due to the arrival of the new paradigm. ishaallah. namaste
December 11th, 2008 at 6:27 am
WHAT A DEAL!!!! Invest in US T-Bills and LOSE money. If they actually sell any it will be a huge, screaming prophecy of our future [which ain't too rosy right now]. Any takers out there, Give Paulson & Bernanke $100 & get $99.92 back at maturity? Hey, why don’t we ALL be real patriotic & just start sending the FED all of our extra cash! No, wait, just send them ALL OUR CASH! After all, when the dust settles on the s--- that is falling on our heads right now THAT’S EXACTALLY WHAT WE ARE GOING TO BE DOING! Think about it, and have a nice day.
December 11th, 2008 at 10:06 am
@14 — Might consider target audience taking poll? “I am unemployed and need a job” doesn’t really show the truth for some of “I can’t pass a drug test.” or a various other reasons. “Needing” a job might not really explain why they aren’t getting a job. Doesn’t AJ refer to these as straw polls?
December 11th, 2008 at 10:22 am
is that right #20 You better get a clue i have been unemployed for two years and can pass any blood test you got. you tell me
December 11th, 2008 at 11:57 am
what happens if the u.s. declares bankruptcy? the bills go worthless?
December 11th, 2008 at 12:46 pm
Kick start the revolution with TONA2009.
TONA2009 google it, sign it, support it, spread it like wildfire.
TONA2009 is more powerful than anything yet conceived by the liberty/truth movement!
TONA2009 will cause immediate positive global change.
Its time to steal the sheep from the wolves. Even the sheep know corruption is bad.
One vote to banish them.
One vote to bind them.
One vote to brand them.
One vote to unite the divided.
If we cant agree against corruption, we have already lost.
December 11th, 2008 at 5:50 pm
Looking forward to issuing some “liquidity” with ordinance to those banking pricks and all who helped make this shyte happen.
December 11th, 2008 at 7:58 pm
PLEASE GOOGLE THESE TWO COMMENTATORS: PETER SCHIFF and MAX KEISER for the truth about the thieves in DC
December 11th, 2008 at 10:12 pm
“A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the civilized world no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men.”
This is published in “The New Freedom” in 1913.
http://en.wikiquote.org/wiki/W......281913.29
Here are some more exerpts. Wilson was obviously the man the power brokers found to meet their needs. All this occured during his reign. Surely he could not have been that blind as to what was happeneing around him. He was a weak President overly dependent on others to advise him.
December 12th, 2008 at 6:38 am
This is a sign of deflation not hyperinflation. Money (debt) is being destroyed far faster than it is being created by the Fed.