hmmmm, I think you PURPOSELY almost completely missed my point.
the dollars aren't being invested ANYWHERE other than treasuries (and interbank lending has begun to calm down a bit). Yesterday's's isuance of 4 month T-bills came in at exactly ZERO percent. Investors were willing to accept NO RETURN just to have their money in an investmetn that they had confidence would actual repay in 1-month time. AND the issuance 4x over subscribed (there were 4 people who wanted to buy at that price, for each note that was sold)... this meant that in the secondary trading, the yield on these treasuries actually went negative (investors were willing to pay $1001 for the right to be repaid $1000 in one month)
It is not crowding out BY the government, at this point, it is a "flight to quality" Investors are spooked right now and are not ivesting in much of ANYTHING except USG paper.
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