The Ice Blog

by Ice

Fed Funds and T-Bills Hit 0% Interest

“What is going on? The credit market remains so tight that state and local governments are being forced to pay interest rates as high as 20 percent. Why is the debt of our insolvent federal government so much more desirable that investors are clamoring to buy it when the return is zero or even negative? The U.S. government is the most indebted nation in the world, with an official federal debt topping $10 trillion. Everyone knows that this debt never can or will be paid off with taxpayer dollars, now or in the future. Commentators have been warning for years that the federal debt would soon be so crippling that foreign investors would flee and the interest alone would be more than the taxpayers could pay. Why are investors now rushing in to buy the U.S. government’s exploding debt, even at a 0% return?  Wouldn’t their money be safer and more liquid tucked under the mattress or left in cash in the bank?”

Read the entire article by Ellen Brown Here .

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December 22, 2008 - Posted by | Banks, Credit, Deficit, Deficit Spending, Economy, Law, Loans/Mortgage, Politics, Taxation | , , , , , , , , ,

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