I ran across this page on the Treasury’s website via Marc Cuban’s blog. It shows the yield on US government treasury bonds, adjusted for inflation. If the yield on a bond is 3% and inflation is 2.5%, the real yield is 0.5%.
So in inflation adjusted terms, anyone buying 5yr treasuries today is paying the US government 1.02% per year to store their money.
Curiously, after the downgrade, the world is paying the US government even more to store their money.
The Chinese still win. In the balance sheet, the trade deficit is higher than the yields.
Interesting thought, however I’m fairly sure no one trusts the US economy anymore.
I know here in Australia we don’t have the same problems you guys are having.