Very troubling, actually …
From the link:
IT’S THE CRASH YOU DIDN’T HEAR. Not in the price of any security market, but in short-term U.S. Treasury yields.
Treasury bills once again were trading at negative interest rates Thursday, a mind-boggling state of affairs that hasn’t existed since the panic late last year. That followed the collapse of Lehman Brothers and the assorted knock-on effects, notably the run on money-market funds after the Reserve Fund “broke the buck.”
More significantly, the yield on the two-year Treasury note — the most actively traded security on the planet — fell to 0.669% Thursday, within a hair of the low of 0.657% set in the dark days of last December, according to data on Barrons.com’s Market Data Center.
But now, the economy is supposed to be well on the way to recovery, in contrast to late last year when it seemed we stood on the precipice of a second Great Depression. The Dow is back above 10,000 and bulls claim all’s right with the world. Why, then, would any rational investor be willing to lock up money for two years for the paltry return of less than two-thirds of 1%?