The Treasury Department sold $21 billion in 10-year notes on Wednesday at a yield of 1.90%, the lowest level ever at auction. Bidders offered to buy 3.19 times the amount of debt sold, compared to an average of 3.15 times at the last four comparable auctions.
That’ll teach us to put partisan bickering over, well, whatever S&P would’ve preferred. Maybe if they downgrade the US again we can sell debt at a negative interest rate.
Let this serve as a reminder that when the world is sloshing around in cash but wants to be risk-off, there is only one place to go at the end of the day – to the country with the deepest, widest, most liquid debt market and the standing army can actually defend the currency.
End of story, nihilists. Insert your “best house in the worst neighborhood” comment here, we’re all ready for it. Then I’ll remind you about how the 30-year outperformed gold last year 🙂