10-year Treasury bond interest at a record low

I thought this chart was interesting.

Interest rates on 10-year U.S. Treasury bonds fell to 1.34 percent on Tuesday, the lowest in 225 years.  They bounced back on Wednesday to only 1.37 percent.

Bond yields of other governments also are low, with the UK, Germany and Japan at record lows.  Ten-year rates in Japan, Germany, the Netherlands and Switzerland are negative—that is, you get back less than you paid for the bond!  France offers 0.13 of a percent on 10-year bonds, Britain 0.91 of a percent.

What this means is that investors are fearful of future, and prefer the safety of government bonds, even at low, non-existent or even negative interest rates, than the risk of investing in the stock market.  Not a good omen!

LINKS

Why the 10-Year Treasury Yield Is at Record Lows by Steve Schaefer for Forbes.

Another Fed Fiasco: U.S. Bonds Fall to Record Lows by Mike Whitney [added 7/14/2016]

Why Interest Rates Are Lower Than Ever, and Why That’s Scary by Paul J. Lim for Money magazine.

10-Year Treasury yield hits record low by Adam Shell for USA Today.

Strong demand for UK gilts at record low yield by Elaine Moore for Financial Times.

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2 Responses to “10-year Treasury bond interest at a record low”

  1. John Pennington Says:

    The stupid thing is that, with the cost of money at historic lows, and the supply of underemployed labor at an all-time high, we don’t invest in ourselves and do something about the tens of thousands of bridges and highways that are in danger of complete failure.

    Like

  2. Tom Says:

    Yes. The problem is that the wealthy owners of all that money absolutely do not view infrastructure spending as investment. They see it as odious taxation, which they have very successfully avoided paying (which is why they have so much money).

    Like

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