In the largest Treasury sale in history, government bonds fell significantly during a $92 billion dollar auction of government debt, $38 billion 2-year bonds, and $54 billion in shorter terms.

This is shortly after last week’s $13 billion dollar bailout fund provided by the Treasury to the U.S. auto industry from the Congress financial market bailout plan.

Short term T-bills are paying less than 0.03% yield after this significant fall on Monday, longer term notes are paying between 0.75% and 3% yield, characteristic of a market which is fearful of risk.

The overnight LIBOR rate is staying well within the “near-zero” range as well, currently sitting at about 0.10% percent according to England-based Bloomberg.com.

The Federal funds rate, the rate at which depository institutions lend balances at Federal Reserve banks, which is strongly correlated to the non-targetory LIBOR rate, is sitting near zero, similarly indicative of the low-risk scenario which investors are following.

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