T-Bills, Munis Are Hot … Compared With Everything Else

You could say that the yield on three-month Treasury bills has quintupled this month, which would explain why they are in demand.

Or you could say that yields on three-month Treasury bills are now at 0.05%, which comes out to just over a penny on every $100 invested.  You could make more than $120,000 on such an investment … if you had $1 billion to invest.

So why are T-Bills and municipal bonds, which likewise offer barely any return, hot today?

One reason is that supply is low and, in an effort to keep national debt below the $14.3 trillion ceiling, new debt is not being issued.  With demand and supply out of balance, prices are rising.  When prices rise, yields drop.

Slow economic growth and new financial regulations are also contributing to low yields.

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