Monday, June 14, 2010

ALERT: Further Decline in T-Bill Rates

The continuing mystifying decline in T-Bill rates continues.

The yield on the one-month T-bill is now at  0.005 %. This is a drop of -0.014 or -36.842%, from Friday. Less than a month ago, on May 20, the one month was at a 52 week high, yielding 0.165%.

The decline in rates means, somewhere, somehow, very serious money wants to be in a totally risk free, virtually no yield position. Yet there does not seem to currently be the panic anywhere in the world that would justify this flight into T-bills.

This kind of activity doesn't happen without something breaking in the markets somewhere big time, very soon.

(Thanks to Michael Dunton at Mt. McKinley Bank for the rates update)


  1. Unrelated, but Bob, you may want to reconsider your "Serious Deflation in D.C." advertisement placement. For a couple of days I would surf your page, see the same post, and skip on to the next site. It took me a bit (duh) to realize that this was sticky and your real posts were accumulating below.

    Just a suggestion.

  2. Bob,

    Is it possible that the huge demand is coming from mutual fund managers terrified about losing more money and just looking for guaranteed (albeit tiny) returns?

  3. The european banking crisis?
    Or maybe its just short term monetary expansion by the fed?