Holding T-bills now pays 30x more than your bank savings account

Sharon McCutcheon/Unsplash

Six months ago, I alerted readers to the very attractive benefits that the TreasuryDirect program offers to investors who are defensively sitting on cash right now.

Since then, those benefits have continued to improve. Substantially.

Back in November, by holding extremely conservative short-term (i.e., 6-months or less) Treasury bills, TreasuryDirect participants were receiving over 16x more in interest payments vs keeping their cash in a standard bank savings account.

Today, they're now receiving over 30 times more. Without having to worry about the risk of a bank "bail-in" or failure.

So if you're holding cash right now and NOT participating in the TreasuryDirect program, do yourself a favor and read on. If you're going to pass on this opportunity, at least make it an 'eyes-wide-open' decision.

Holding Cash (In Treasurys) Now Beats The Market

There are many prudent reasons to hold cash in today's dangerously overvalued financial markets, as we've frequently touted here at PeakProsperity.com.

Well, there's now one more good reason to add to the list: holding cash in short-term Treasurys is now meeting/beating the dividend returns offered by the stock market:

"Cash Is King" Again - 3-Month Bills Yield More Than Stocks (Zero Hedge)
'Reaching for yield' just got a lot easier...
For the first time since February 2008, three-month Treasury bills now have a yield advantage over the S&P 500 dividend yield (and dramatically lower risk).
Investors can earn a guaranteed 1.90% by holding the 3-month bills or a risky 1.89% holding the S&P 500...

The longest period of financial repression in history is coming to an end...

And it would appear TINA is dead as there is now an alternative.

And when you look at the total return (dividends + appreciation) of the market since the start of 2018, stocks have returned only marginally better than 3-month Treasurys. Plus, those scant few extra S&P points have come with a LOT more risk.

Why take it under such dangerously overvalued conditions?

If You Can't Beat 'Em, Join 'Em

In my June report Less Than Zero: How The Fed Killed Saving, I explained how the Federal Reserve's policy of holding interest rates at record lows has decimated savers. Those who simply want to park money somewhere "safe" can't do so without losing money in real terms.

To drive this point home: back in November, the average interest rate being offered in a US bank savings account was an insutling 0.06%. Six months later, nothing has changed:

(Source

That's virtually the same as getting paid 0%. But it's actually worse than that, because once you take inflation into account, the real return on your savings is markedly negative.

And to really get your blood boiling, note that the Federal Reserve has rasied the federal funds rate it pays banks from 1.16% in November to 1.69% in April. Banks are now making nearly 50% more money on the excess reserves they park at the Fed -- but are they passing any of that free profit along to their depositors? No....

This is why knowing about the TreasuryDirect program is so important. It's a way for individual investors savvy enough to understand the game being played to bend some of its rules to their favor and limit the damage they suffer.

Below is an updated version (using today's rates) of my recap of TreasuryDirect, which enables you to get over 30x more interest on your cash savings than your bank will pay you, with lower risk.

TreasuryDirect

For those not already familiar with it, TreasuryDirect is a service offered by the United States Department of the Treasury that allows individual investors to purchase Treasury securities such as T-Bills, notes and bonds directly from the U.S. government.

You purchase these Treasury securities by linking a TreasuryDirect account to your personal bank account. Once linked, you use your cash savings to purchase T-bills, etc from the US Treasury. When the Treasury securities you've purchased mature or are sold, the proceeds are deposited back into your bank account.

So why buy Treasuries rather than keep your cash savings in a bank? Two main reasons:

  • Much higher return: T-Bills are currently offering an annualized return rate between 1.66-2.04%. Notes and bonds, depending on their duration, are currently offering between 2.6% - 3.1%
  • Extremely low risk: Your bank can change the interest rate on your savings account at any time -- with Treasury bills, your rate of return is locked in at purchase. Funds in a bank are subject to risks such as a bank bail-in or the insolvency of the FDIC depositor protection program -- while at TreasuryDirect, your funds are being held with the US Treasury, the institution with the lowest default risk in the country for reasons I'll explain more in a moment.

Let's look at a quick example. If you parked $100,000 in the average bank savings account for a full year, you would earn $60 in interest. Let's compare this to the current lowest-yielding TreasuryDirect option: continuously rolling that same $100,000 into 4-week T-Bills for a year:

  1. Day 1: Funds are transferred from your bank account to TreasuryDirect to purchase $100,000 face value of 4-week T-Bills at auction yielding 1.68%
  2. Day 28: the T-Bills mature and the Treasury holds the full $100,000 proceeds in your TreasuryDirect account. Since you've set up the auto-reinvestment option, TreasuryDirect then purchases another $100,000 face value of 4-week T-Bills at the next auction.
  3. Days 29-364: the process repeats every 4 weeks
  4. Day 365: assuming the average yield for T-Bills remained at 1.68%, you will have received $1,680 in interest in total throughout the year from the US Treasury.

$1,680 vs $60. That's a 27x difference in return.

And the comparison only improves if you decide to purchase longer duration (13-week or 26-week) bills instead of the 4-week ones:

Repeating the above example for a year using 13-week bills would yield $1,925. Using 26-week bills would yield $2,085. A lot better (34x better!) than $60.

Opportunity Cost & Default Risk

So what are the downsides to using TreasuryDirect? There aren't many.

The biggest one is opportunity cost. While your money is being held in a T-Bill, it's tied up at the US Treasury. If you suddenly need access to those funds, you have to wait until the bill matures.

But T-Bill durations are short. 4 weeks is not a lot of time to have to wait. (If you think the probability is high you may to need to pull money out of savings sooner than that, you shouldn't be considering the TreasuryDirect program.)

Other than that, TreasuryDirect offers an appealing reduction in risk.

If your bank suddenly closes due to a failure, any funds invested in TreasuryDirect are not in your bank account, so are not subject to being confiscated in a bail-in.

Instead, your money is held as a T-Bill, note or bond, which is essentially an obligation of the US Treasury to pay you in full for the face amount. The US Treasury is the single last entity in the country (and quite possibly, the world) that will ever default on its obligations. Why? Because Treasurys are the mechanism by which money is created in the US. Chapter 8 from The Crash Course explains:

As a result, to preserve its ability to print the money it needs to function, the US government will bring its full force and backing to bear in order to ensure confidence in the market for Treasurys.

Meaning: the US government won't squelch on paying you back the money you lent it. If required, it will just print the money it needs to repay you.

So, How To Get Started?

Usage of TreasuryDirect is quite low among investors today. Many are unaware of the program. Others simply haven't tried it out.

And let's be real: it's crazy that we live in a world where a 1.68-2.09% return now qualifies as an exceptionally high yield on savings. A lot of folks just can't get motivated to take action by rates that low. But that doesn't mean that they shouldn't -- money left on the table is money forfeited.

So, if you're interested in learning more about the TreasuryDirect program, start by visiting their website. Like everything operated by the government, it's pretty 'no frills'; but their FAQ page addresses investors' most common questions.

Before you decide whether or not to fund an account there, be sure to discuss the decision with your professional financial advisor to make sure it fits well with your personal financial situation and goals. (If you're having difficulty finding a good one, consider scheduling a free discussion with PeakProsperity.com's endorsed financial advisor -- who has considerable experience managing TreasuryDirect purchases for many of its clients).

In Part 2: A Primer On How To Use TreasuryDirect, we lay out the step-by-step process for opening, funding and transacting within a TreasuryDirect account. We've created it to be a helpful resource for those self-directed individuals potentially interested in increasing their return on their cash savings in this manner.

Yes, we savers are getting completely abused by our government's policies. So there's some poetic justice in using the government's own financing instruments to slightly lessen the sting of the whip.

Click here to read Part 2 of this report (free executive summary, enrollment required for full access)

NOTE: PeakProsperity.com does not have any business relationship with the TreasuryDirect program. Nor is anything in the article above to be taken as an offer of personal financial advice. As mentioned, discuss any decision to participate in TreasuryDirect with your professional financial advisor before taking action.

Nearly two years after the January 6 riot at the Capitol, the mystery of who planted two pipe bombs outside the Republican and Democratic National Committee offices remains unsolved. Thankfully, the bombs were found and disabled before they could cause any harm, but with their potential for devastating consequences — not to mention the massive investigations into all things relating to Jan.6 — why does it seem like this story has practically fallen off the face of the earth?

No one in the corporate media has even tried to look into it, and the government's narrative that the bombs were meant to be a diversion for the Capitol riot doesn't make sense when you look at the timeline of events.

So, on this week's episode of "Glenn TV," Glenn Beck broke down the timeline of events that led up to the discovery of the bombs and how the facts appear to point toward one sinister conclusion:

  • Security footage reportedly shows that the two pipe bombs were planted in front of the DNC and RNC the day before the riot.
  • Neither bomb was concealed.
  • Then-Vice President-elect Kamala Harris entered the DNC headquarters at approximately 11: 30 am on January 6.
  • At approximately 12:40 pm on January 6, the first pipe bomb was discovered sitting in plain sight outside the DNC headquarters, raising questions as to why the incoming vice president didn't have better security.
  • The pipe bomb had a one-hour kitchen timer that had apparently stopped with 20 minutes left on the timer. (Remember, the bombs were planted on January 5.)
  • The Secret Service reportedly erased their communications from January 5t and January 6 by "accident."

"It doesn't really hit you unless you look at it as a timeline, and then you're like, 'wait a minute that doesn't seem right.' The unsolved mystery of the pipe bomb has been used by the government to show that January 6 riot was part of a larger coordinated attack ... that the bombs were a diversion to get the Capitol police away from the Capitol," Glenn explained.

"But the bomb had a one-hour timer and it was planted at 8 p.m. the night before. So the bomb would have to go off the night before at about 9 p.m. on January 5. How's that a diversion? It's not physically even possible."

Watch the video clip below to hear more or find the full episode of "Unsolved Mysteries: 7 Deep-State SECRETS Biden Wants Buried" here.


Want more from Glenn Beck?

To enjoy more of Glenn’s masterful storytelling, thought-provoking analysis, and uncanny ability to make sense of the chaos, subscribe to BlazeTV — the largest multi-platform network of voices who love America, defend the Constitution, and live the American dream.

The Biden administration has weaponized the federal government against the American people. But officials have hidden most of their attacks behind a secretive and cavernous bureaucracy.

There are so many unsolved mysteries that Joe Biden and the Democrats not only refuse to answer, but in some cases appear as though they are ACTIVELY trying to cover up. Like what happened on January 6? Who is Ray Epps? Who planted the pipe bombs? What’s in Biden’s executive order on elections? What happened to the SCOTUS Dobbs leaker? What’s the COVID origin story? What’s happening with crypto, FTX, and the Central Bank Digital Currency?

These are just a few of the unsolved mysteries that we need to DEMAND answers on. On his Wednesday night special, Glenn Beck outlines a chalkboard that will leave you convinced the DOJ and FBI are LYING to the American people. The more secrets the Deep State holds, the more its power over us grows.

Watch the full episode of "Glenn TV" below:

Unsolved Mysteries: 7 Deep-State SECRETS Biden Wants Buried | Glenn TV | Ep 238

Want more from Glenn Beck?

To enjoy more of Glenn’s masterful storytelling, thought-provoking analysis, and uncanny ability to make sense of the chaos, subscribe to BlazeTV — the largest multi-platform network of voices who love America, defend the Constitution, and live the American dream.

'I NEVER thought I'd talk about this': Was Glenn Beck's CHILLING dream actually a WARNING?

(Left) Photo by Charles McQuillan/Getty Images/(Right) Video screenshot

On the radio program this week, Glenn Beck decided to share a very unusual, extremely vivid dream he had ten years ago — a dream he thought he'd never talk about on the air until he began to see it as a warning that we should all know about.

"I never ever thought I would talk about this on the air, but I feel compelled to tell you that seasons have changed again, and it is becoming more and more apparent. You need to know what you're dealing with," Glenn began.

"If you are a long-time listener of this program, you know that one of the reasons I left New York ... was that I had a medical condition. Part of it was brought on by no REM sleep for about 10 years ... and for 10 years, I never had a dream," he explained. "However, during this period I had what could be described as a dream. I do not believe it was."

"In this 'dream' ... I am in a hallway of the White House. And I'm walking into a big room where there's a bunch of cubicles, and people look up like, 'who's walking in?' There are people behind me, but I don't know who they are yet. I just know I'm being pushed forward by them," Glenn continued. "I realize that everybody in the White House is terrified of who's ever behind me ... I glance back and I see people that are in uniforms that I've never seen before. I have seen them since, but that will be for some other time...."

"So, these guys in the uniforms are in the hallway, and one guy says, 'him, him, and him, take them out' ... and I'm the only one still sitting at the table. They go out ... then I hear three gunshots and they say, 'yeah, that happened pretty quickly for them. However, you, we're going to get to know ... because you really have no idea who you're dealing with.' And that's when one of them ... ripped off his face and he was Satan. Or, he was a demon, okay? Horrifying. Then I wake up."

Glenn went on to explain that, while the dream was so vivid and disturbing that he thought about it almost daily for well over a year, it was what happened next — during a discussion with a prominent religious leader — that really hinted his "dream" might actually have been a vision of the future and a warning.

"I will never forget it, and I will never dismiss it," Glenn said of what he learned. "I'm sharing it with you today because you must not dismiss what you're dealing with. We are not in a battle [of] politics ... our whole culture has become evil."

"You have to get to a point where you are going to choose a side. There will be no one left on the benches, and if you think you can sit it out you will end up on the wrong side. I urge you to know who you serve. This is a different time in human experience. This is not normal. None of this is normal," he warned.

Watch the video clip below to hear more from Glenn. Can't watch? Download the podcast here.

Want more from Glenn Beck?

To enjoy more of Glenn’s masterful storytelling, thought-provoking analysis, and uncanny ability to make sense of the chaos, subscribe to BlazeTV — the largest multi-platform network of voices who love America, defend the Constitution, and live the American dream.