Quote Of The Day

Those of us who predicted lenders would avoid US Treasuries during the financial meltdown we initially somewhat surprised to see investors flocking to them. It’s the result of a supposed “flight to quality”, and nothing at the time seemed less risky than buying US Treasury bonds, since the Treasury sells its bonds in a currency it can print.

Well, that has changed, as represented by yields:

The bond market is saying that it’s safer to lend to Warren Buffett than Barack Obama.

When it’s “safer” to lend to a corporate businessman who can’t print his own currency or extort his subjects citizens for more tax dollars, you know something serious is going down.

Berkshire Hathaway, P&G, Johnson & Johnson, and Lowe’s are all trading below similar maturity US T-bills, a situation the linked article calls “exceedingly rare”.

But don’t worry, mere citizen. I’m sure Obama’s working on an individual mandate to get you to “do your part” and invest in Treasury bonds.

Hat Tip: QandO

UPDATE: Looks like yields are continuing to rise.

  • Let’s Be Free

    The mandated treasury investment plan ideas under consideration hide behind a “you will get a guaranteed annuity” rubric. Unfortunately, there will likely be movement down this road in the not to distant future.