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In the ordinary world, an investor buys bonds to earn interest. The world today is not ordinary. The Treasury Department has just sold $32B worth of 4-week bonds (T-Bills) that yield 0%. Zero. Percent.

"I have never seen this before," said Michael Franzese, head of government bond trading at Standard Chartered. "It's all about capital preservation for the turn of the year, not capital appreciation."

Setting aside the intricacies of bond trading (and I am a novice there anyway), investors are essentially letting the government use their cash for nothing more than the promise that they’ll get it all back next month.

In a broad and general view, this makes sense under deflationary conditions. If I expected the price of widgets to drop from $1 today to 80¢ next month, I would hold off buying until next month. I would sit on my cash until prices went down, making my cash worth more. If I was worried about the security of my cash—I can’t store that much paper money under my mattress, and corporate bonds are too risky when everyone is threatening bankruptcy—the safest place to park it is with Uncle Sam.

But it is far from clear that we’re facing deflation, more so over the short course of just a month. The government and Fed have thrown an extra half-trillion dollars into the economy. More dollars for the essentially the same amount of stuff means each dollar is worth less. That’s inflationary, not deflationary.

My first guess, since the inflation/deflation coin hasn’t landed yet, is that there is some tax benefit to holding T-Bills over the turn of the year. But I’m no expert. Then, though, the experts don’t really know what’s happening or why.

Interesting times…