I'm sure you have all seen the action in 3 month Treasury bills lately. There are also stories out about T-bill yields going negative recently. You can see yield volatility on the 3-month T-bill discount rate below ($IRX at Stockcharts.com). On October 18th and 19th $IRX went from 0.55% to 0.05%! 50 basis boints cut in two business days to just about 0%. It since rallied and fell to 20 basis points (0.20%). 3-Month bills were yielding 2% this summer. The last time $IRX hit 0% was during the financial crisis (November/December 2008, 2nd chart below). Some say the action is related to
banks getting liquid for year end. Others say investors are getting safe and short term to battle WAVE C or the bond bears. As I mentioned a
few days ago, 20+ Treasury Bonds ($TLT) and 30 Year yields are approaching
judgment day (pierced through downtrend today). I don't trade 3-Mo bills or run a money market fund so any input here would be great. If gold and the markets implode or yields spike, bills seem like the place to be imo.
Recent Articles:
MONEY MARKETS-U.S. Treasury bill rates dip below zero (
Reuters, 11/20)
Is This the Start of a Dollar Rally? (
Minyanville)
T-bills yield no interest, 1st time since 1938 (
Bloomberg)
Perilous potential of divergence in US financial markets (
Independent.ie)
Treasury Sells Two-Year Notes at Record Low Yield (
Bloomberg)
Bonds Blast a Warning (
Daily Reckoning, 11/24)
Sinking short-term Treasury yields aren't a sign of panic this time (
LATimes)
With T-Bill Yields at Zero, it’s Time to Beware of the “Bond Bears” (
MoneyMorning)
