Would You Accept A Negative Interest Rate?

The Wall Street Journal reported yesterday that “The yield on the U.S. Treasury bill maturing on Oct. 2 traded at negative-0.01%.”  The negative rate means that the USA’s government is paid to take out loans and buyers of the treasury bills are charged for saving money.   This situation is similar to someone asking you if they could borrow $10 today with the promise that they will pay you back $9 tomorrow.  You know ahead of time it is a bad deal that will cost you money.  While some professional traders knowingly made money losing trades yesterday, would you ever accept a negative interest rate?

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