Treasury Sells 3-Month Bills At 0% Yield For First Time Ever

Tyler Durden's picture

"Investors" are so desperate to hold on to short-term paper that they paid $100 for a 3-month Treasury-bill at today's auction. That is a 0% yield - for the first time ever - lower even than the auction right after Lehman's bankruptcy in Nov 2008.


Chart: Bloomberg

It is probably safe to say that NIRP is next, followed by more negative yields further to the right of the curve, as the US gradually becomes Europe.

But don't worry: as Yellen admitted during her healthcare-scare speech, "nominal interest rates cannot go much below zero", just a little.

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clipboard man's picture

Hey, that's the same interest that I get on my silver coins!

Spitzer's picture

Why didn't Tyler say bubble ? Cuz that's what this garbage is

Boris Alatovkrap's picture

Excrement of goat to quote Brother of Lehman.

Squid-puppets a-go-go's picture

if a 0% bond is just cash with a counterparty, what kinda idiot is buying this shit?

sp0rkovite's picture

Globally there are many pensions required by law to own "safe" investments in the bond market. Some may be led to slaughter seeking "protection" from equity markets

ZZZZZZ's picture

The idiots are mutual funds, pension funds, insurance cos, etc who are not allowed to hold "cash".

Cash isn't "cash", for most it's just an electronic blip. Real paper cash is the way to go.

TheRideNeverEnds's picture

Well you see, bonds look expensive now but in a few months when they are negative you'll wish you had some of those sweet sweeeet par bonds in your book.

Call me when the US ten year is negative five percent and we can talk about maybe nearing the top of this bond bubble....

thunderchief's picture

You have gotten 7 percent on those coins in two days, not including premiums. 

More to come.

yrad's picture

We NIRPED some folks...

bigkahuna's picture

Can someone tell me why anyone would lock up their cash for 3 months for no return? Who is buying these things?

This leads eventually to the NIRP bail in scenario in banks.

LawsofPhysics's picture

Well, at least your silver is something fucking real!  I have never had a hard time exchanging it for the fruit of another's labor.

FlacoGee's picture

Yeah, but the treasuries have not lost 50% of their value.

Smart trade is to sell those silver coins while the price is over $10





TheRideNeverEnds's picture

this guy gets it, silver is going back to 5 dolla, make you holla.

I am still an incremental buyer under 20 on the way to 5 may just get my fill around there then hold on for the moonshot.

Anyone thinking gold and silver cant go another 50-75% lower from here is fooling themselves. How many miners have gone to zero thus far? Not nearly enough is the answer to that.

Of longs its my only one but still, do not think for one second you are not taking a large risk (at least as much risk as buying the indexes here or maybe even more than say a Facebook or Netflix depending on what you buy) buying metals and especially individual miners here are fraught with risks in both directions. The FED and .gov will bail out the Dow S&P Nasdaq issues in probably that order, maybe Russell 2k but they are all pretty much the same. They will not bail out HUI or GDX. They will not bail out ABX or AU or IAG. These things will either go to zero of multiple hundreds of percent higher.

How many miners are on the listed market, anyone know? When 50% have been de-listed buy everything metals and miners until then strong sell on any uptick against short bonds one to one notional.

or if you wanna get crazy 1GC/1SI/1PL/1HG vs 2ZB/4ZN sell em all and let the market gods sort em out, I go a bit moar bond heavy personally.

My book now though is a large bond short paired against a flotilla laden down stem to stern with short facebook deltas and a slight bullish volatility bet in equity and bond volatility, more bullish bond volatility. The flotilla is anchored with metals and miners.

Bad news is I am happy with my bond short, that means the bottom is in for bonds and they will probably go straight higher for the remainder of this decade, next stop the moon....

Glass Seagull's picture


People say I should act my rate...

Well, what's my rate again...what's my rate again?

Dr. Engali's picture

Rate hike imminent..., Lol. The countdown to NIRP is on.

Ignatius's picture

I'll put the champagne on ice.

Groundhog Day's picture

We have odds on when rate hikes are likely to occur,  where are the odds on when the nirp is incepted and how much

KnuckleDragger-X's picture

"Let me just stick the tip in and see how it feels"......

rbg81's picture

The Plan is for them to make $$ off their debt.  And it has been for decades.

Bay of Pigs's picture

Good thing there is no inflation.

Viffer's picture

Well ... duh!

PPT has been working overtime this past week and had to do some stealth QE.  The problem is that they did not have the printers running so they had to dig into the piggy bank.

madbraz's picture

yet NY FED pumps up reverse repos by $100 billion more last Friday to give collateral to their friends to short treasuries and maintain an incredibly steep yield curve that has no bearing on reality.  what a joke.

Bay of Pigs's picture

ZH and the Tylers don't seem to focus on the NYFED and the William Dudley anymore.

Why is that?

madbraz's picture

mister dudley doesn't care anymore - he seems to have gone overboard with that mega trading desk of his organization.  hopefully he will be gone when the dominos fall.  they will fall.

LawsofPhysics's picture

^^^this.  Fucking amazing that dollar reserves are not being sold/dumped around the world.  Who knew that a "dirty shirt" or "pushing on a string" had so much power....

same as it ever was, at least until the supply lines break in earnest (i.e. the SNAP cards don't work).

ThroxxOfVron's picture

The FED sold their constituents/cronies derivatives protection in the form of swaptions.

Rates only matter so much if you have a rate enhancing or minimum rate contract.

-Think 'side letter' in insurance parlance.

The Treasury Market has long since been bifurcated: one set of interest rates for you and another set for the Cartel Banks who are being covered with side-letter/swaption insurance at issuance.

Think of it as a monetary boilermaker: a swaption/shot in every treasury/beer served to the Regulars by Barmaid Yellen.

arbwhore's picture

And gold is pushed down at the same time. Everything is awesome!

I AM SULLY's picture
I AM SULLY (not verified) Oct 5, 2015 10:59 AM



(and our spiritual one-ness is beyond level 42)


LawsofPhysics's picture

When rates on the five, ten, or 30 year go negative in real terms, it is game over for the FRN.



A ways to go yet.

KnuckleDragger-X's picture

They are trying as hard as they can and it's hard work destroying an entire economy.....

Son of Loki's picture

Retirees I know who did not save big time and getting devastated big time due to the zero returns on their savings. No one could have predicted how much they hated the middle class savers and retirees.

petroglyph's picture

I had to sign in to up 1 you.

I was that saver

ThroxxOfVron's picture

I only know two types of Retirees.


1. Public Pensioneer.   "PAY ME."  


Offthebeach's picture

Sheeple deserve shearing.

Fedgov notes are parnerships. Sheeple are very very junior. They get, or don't, what they are told to get.

Pubic skools have conditioned farm raised trout like obedienced.

Basically most old people are government bitches. Old ugly ones waiting around for Uncle Nappy to come by with the government chedder.
Good luck with that.

Obamacare deathcamps await. Don't worry about digitalized "savings". That delusion sailed off long ago.

Normalcy Bias's picture

All yer monies belong to the gubbermint!

Argenta's picture

I'll say one thing, the Fed has done a marvelous job of brainwashing many people.  What a scheme.  Let's convince nearly everyone that "wealth" and "paper" are synonymous, then create it ad naseum to infinity.  What could possibly go wrong with that?


aliki's picture

CNBC should recall all those guests who were calling for 3.5-4.00% on a US 10-year & all those "great rotation out of bonds into stocks"

i guess they could do that but it would fill an entire days worth of interviews (and only at 5 seconds at a clip).

im starting to think the feds newsest, biggest fear is that they raise interest rates 25 bps and long rates drop. THAT would show the "investment world" just how fucked things really are.

Soul Glow's picture

The Fed doesn't know what to do with the tens of billions of dollars they print everyday so they keep buying worthless US Treasury debt.

LawsofPhysics's picture

Just wait until everyone else tries to dump their dollars too...

Downtoolong's picture


Who’s buying? For zero earnings you can just hold cash which has more liquidity, i.e., you don’t tie up your money in case a better opportunity comes along during the next three months.


The only reason I can imagine is if the buyer wants to support government borrowing, and what buyer would be willing to do………..


Oh, right.


LawsofPhysics's picture

Yes, basically it is the same as it ever was!!!!

The only other way to get the same result that has been successfully used in the U.S. is of course war bonds!!!

danger...  danger... danger...

2muchtax's picture

betting on negative rates?

HardlyZero's picture

Sometime, somewhere, this has to lead to a DIVIDE-BY-ZERO ERROR.

No ?

yogibear's picture

Round-robin central banks buying each others debts. 

Japan, Europe and the US.  All doing it to prevent an epic failure.

ZZZZZZ's picture

Doug Caey call's it a "global game of old maid."

The only question is who gets stuck with the bitch card?

FranSix's picture

'For the first time in 70 years'. Fixed it for ya