A Sure Fire Non-Money Maker!
A few weeks ago, the 4 week T-bill auction reported a yield of 0.000% (that is NOT a type-O). A T-bill stands for a treasury bill. A Treasure Bill is a short-term debt obligation backed by the U.S. government with a maturity date of less than a year. T-bills are sold in $1000 denominations.
It seems odd that people would be willing to accept no return after buying a T-bill, but that is in fact what is happening. When people need a place to put their cash, there is nothing safer than a government security.
Where are you putting your money? We have a lot of our money in money market accounts right now, primarily ING Direct.
Photo by Kevin Dooley
External Resources:
Investopedia - T-Bill
Recent Bill Auction Results
Safety outweighs negative yield for some T-bill investors
Treasury Bills: Rate Tracking, Discussion, and FAQs
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I am more interested in inflation protection than I am in 0% Treasury yields so I am buying I Bonds and inflation protected securities mutual funds.
The strange thing about these T-bill with a yield of 0.000% is that people buy them. Maybe only because 0.000% is better than a loss, but people are buying them.