The 10 year treasury bond dropped 16 basis poinst today to 1.72%. http://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield. Today was likely the result of several $100 billion of stocks, gold, and silver being sold to buy bonds ahead of operation twist. The Fed is sending everyone into treasuries as funding the government is their number one mandate. People are not buying treasuries for the measly 1.72% yield as this is a loser when inflation is 8%. They are buying because they expect the interest rate to fall further due to operation twist and this will increase bond prices. Once the yield has dropped to its new equalibrium,this money flow will stop. This indicates to me that this drop is of short or medium length and that this is not another 2008 flight to the safety of treasuries. It has only been a little over one month since S&P downgraded treasuries.

Treasuries are an accident waiting to happen and that day will eventually come.