How Long Will the World Keep Buying Our Treasuries?

First the good news: at least interest rates are still low. And that's about it for the good news, folks. If you're like me, you're disgusted with the inability of our elected officials to swallow some of their promises and strike a deal to cut money from the U.S. budget. Just think if the 'Super Committee' had struck a deal: U.S. businesses – including mortgage firms – could plan for the coming year. As I write this, stocks are down about 100 points on the Dow and the yield on the benchmark 10-year Treasury is at 1.97%, up a tick or two. Investors keep buying U.S. bonds because they are considered a safe bet in turbulent times. Who cares if the yield stinks? At least an investor will get his principal back – or so they believe. The only reason institutions keeping buying Treasuries instead of Euro debt is because the U.S. has less of a social safety net to support. The thinking is that when push comes to shove our leaders will somehow strike a budget deal and come up with the money. But it didn't happen this time around. I guess the gun isn't quite pointed at the head of the beast. At least not yet. Happy Thanksgiving.