UnThreaded | Threaded | Whole Thread (4) | Ignore Thread Prev | Next
Author: rkmacdonald Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 35400  
Subject: Re: Treasury Zero-Percent Cert of Indebtedness ? Date: 2/27/2005 2:18 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
Author: pauleckler | Date: 2/27/05 11:30 AM | Number: 11939
Treasure derivatives called strips and tints have been available for years.

Paul,

I think that Certificates of Indebtedness are nothing more than official IOU's.

In the past, Certificates of Indebtedness were used mainly by banks and currency traders to assure a reserve of cash to back notes and coins that were being issued. They sometimes (usually?) paid a very small coupon like a note.

But, this seems to be a new use, and I don't think there is any coupon at all. I think you place money in your C of I account at the Treasury, to be used to purchase traditional Treasury instruments (bills, bonds, etc) at a later time. It's sort of an escrow account for holding funds to make these purchases.

I think it helps the government expedite settling of the multitude of sales at an auction.

Russ
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (4) | Ignore Thread Prev | Next

Announcements

Foolanthropy 2014!
By working with young, first-time moms, Nurse-Family Partnership is able to truly change lives – for generations to come.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Macro Economics

Looking at Currency Ratios
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement