How low can it go?

wsuffa

wsuffa

Touchdown! Greaser!
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Bill S.
T-Bill has gone negative - that's something I never thought I'd see. It's shades of Japan a decade or so ago.... and portends the real risk of deflation (investors are expecting even worse returns on other things....)

Yeow.
 
All the while the wonderful minds in our government, including the President-elect, think the best way out of this mess that was created by loose credit and over-borrowing is to BORROW MORE AND SPEND MORE!

What morons.....we are sooooo doomed. :(
 
wsuffa said:
T-Bill has gone negative - that's something I never thought I'd see. It's shades of Japan a decade or so ago.... and portends the real risk of deflation (investors are expecting even worse returns on other things....)

Yeow.
Click to expand...

FWIW, Bill, its only short term T-Bills that have gone negative...I think its 90 days (I could be wrong, I'm going off memory).

Not good either way but at least we've still got some home.
 
wsuffa said:
T-Bill has gone negative - that's something I never thought I'd see. It's shades of Japan a decade or so ago.... and portends the real risk of deflation (investors are expecting even worse returns on other things....)

Yeow.
Click to expand...


Bill, remember they dipped negative a few weeks ago, then came back. This is terrible. We can't keep borrowing and printing money. :rolleyes:
 
SkyHog said:
FWIW, Bill, its only short term T-Bills that have gone negative...I think its 90 days (I could be wrong, I'm going off memory).

Not good either way but at least we've still got some home.
Click to expand...

Short term or long term really doesn't matter. The fact that it's gone negative (even in the short-term sense) indicates that the market thinks all other investments will have even greater negative returns. That generally - but not always - is an indicator that the "market" thinks there will be deflation.

Anthony said:
Bill, remember they dipped negative a few weeks ago, then came back. This is terrible. We can't keep borrowing and printing money. :rolleyes:
Click to expand...

Anthony, I agree - we can't keep printing money. On the other hand, if we do so right now, there is a school of thought that says tightening the money supply will cause a depression.

The market is partly responsible for setting the rates by bidding-up the price of a bond/bill (thereby reducing the interest rate). This really can't go on.... if it does for any length of time, we have to watch out for deflation.

Look at what happened in Japan in the early '90s.
 
Unfortunately it looks like the Prez is stepping in. :mad3:
 
wsuffa said:
T-Bill has gone negative - that's something I never thought I'd see. It's shades of Japan a decade or so ago.... and portends the real risk of deflation (investors are expecting even worse returns on other things....)

Yeow.
Click to expand...
You are not the only one who believed it cannot go negative. When I was doing QA work at the bank, my suggestion to test negatives was pooh-poohed. Wonder when the scramble began to put negative processing into the software.
 
AuntPeggy said:
You are not the only one who believed it cannot go negative. When I was doing QA work at the bank, my suggestion to test negatives was pooh-poohed. Wonder when the scramble began to put negative processing into the software.
Click to expand...

Peggy - I believed it could go negative if the right circumstances were hit (we saw it in Japan). I just never thought I'd see it here in the US... while I understood greed, I thought we (as a nation) were smarter than that. Guess I was wrong.
 
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