Buy Short-Term Treasurys for ZERO YIELD

[tripods68]

Investors Buy Treasury Bonds for No Yield - Bonds and Treasuries * US * News * Story - CNBC.com


WOW!

[sweeps]

Was just about to post that. Pretty amazing.

[disneysteve]

I don't get it. Why would anybody buy a 0% bond? Why not put the money in a CD or anything paying more than 0%?

[scfr]

Originally Posted by disneysteve

I don't get it. Why would anybody buy a 0% bond? Why not put the money in a CD or anything paying more than 0%?

I don't think individual investors are.

But mutual funds, pension funds, government entities, businesses and the like also need a safe place to park their money.

[disneysteve]

Originally Posted by scfr

I don't think individual investors are.

But mutual funds, pension funds, government entities, businesses and the like also need a safe place to park their money.

There are no safe places that pay interest? Can they not use money market accounts, municipal bonds, CDs and other things that us regular folk use?

[tripods68]

scfr is right.

CDs aren't appropriate investment vehicles for big institutions to park moneys when dealing with billions of funds. Besides CDs are for individual investors (FDIC requirements not corporations.

[scfr]

Originally Posted by disneysteve

There are no safe places that pay interest? Can they not use money market accounts, municipal bonds, CDs and other things that us regular folk use?

Hard to keep track of all those accounts when you have billions you are trying to keep under the FDIC insurance limits.

[disneysteve]

Makes sense. Seems like it would make even more sense to take the cash and stick it in a big safe with an armed guard and attack dog in front of it.

[scfr]

Originally Posted by disneysteve

an armed guard and attack dog in front of it.

Probably this is exactly how the entities buying Treasuires at zero or negative yield view their Uncle Sam.