Tuesday, December 9, 2008

Three-Month Bill Yield Goes Negative

Following a Treasury auction that pushed 4-week T-bills down to a yield of 0.000%, the three-month Treasury went negative this afternoon, according to WSJ.

Clearly, hedge funds, mutual funds, and the like, are staying extra liquid and conservative with parts of their portfolios in anticipation of end oy redemptions.

I say short T-bills, and expect a major rally at the first of the year, or just before.

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