Treasuries yields ticking up, but still in liquidity trap territory

Today I was able to look at the rates on treasuries for the first time in just over a week.

I was surprised to see them above zero, but these rates are still extremely low.

The ted spread has come in almost entirely, but when short term treasury rates are close to zero, it should probably be even lower than it is.

A simple way to think about treasuries is through the lens of time indifference. Treasuries are as good as cash - they will be repaid at expiration. ( pay no mind to those fools who actually make prices on the U.S. govt. defaulting!). So when short term treasury yields are really low, people with money are thinking, "I just want my money back in 3 months. I do not care about inflation or making money. I just want to protect my money." So when short term treasury rates were negative recently, people were actually paying for the ability to simply be repaid at a later date.

Now it is important to keep in mind that the major news since December is the size of the stimulus package. The U.S. Tresury will be spending, and therefore borrowing, huge sums of money. In an environment looking at $1T of spending, when very short term rates are this low, we are in a liquidity trap.

Therefore, we need to spend more money!