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
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