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New Sign of Investor Fear, T-Bill Yields Go Negative

Here's how nervous investors have become: At one point yesterday afternoon, people were willing to pay the USA Treasury to keep their money safe for three months.

News of weak balance sheets at some of the world's largest companies sent stocks tumbling, and investors fled once again to the safety of U.S. government securities. In trading yesterday, the yield on three-month Treasury bills briefly fell into negative territory for the first time ever.

Investors normally expect to earn some interest if they lend money to the government, but that expectation was set aside with the prospect of a deepening recession and new private sector setbacks. The Treasury Department sold $30 billion in four-week bills at an auction at a rate of zero percent for the first time since the bills began regular sale in 2001.

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