I was very careful not to interject political dialog in my statements regarding QE. So, do you think I'm a "freeloader" because I discuss tax strategy regarding capital gains rates?
Regarding Treasury interest rates: I believe it is a a combination of a few factors:
1. Return of capital is more important than Return on capital. This is in support of your statement regarding "rush into the dollar" but also encompasses more. If you have investment capital, but are afraid to put it into plants, people, equipment, etc, where do you park it? Best place is in short term US paper, with the emphasis on short term.
2. Who are the buyers of US Government debt in recent auctions? Well, according to this article, 61% of the net new US Government debt auctioned in 2011 was purchased by......the Federal Reserve. Here's a quote:
Whether or not you think this is a good decision (by the Fed), you must admit that it cannot go on forever.
I would rather not have a political discussion on this, or even one with implied name calling or to discuss who are "freeloaders".
You are free to believe whatever you want. I make my investment decisions based on what I think is happening, or will happen in the future. While I could have it exactly backwards, I've managed to steer a pretty decent course over the years, my net worth is double what it was in 2004, almost 3x what is was 1/1/2000, and I've been FIREd since early 2009. In addition, after reaching a peak net worth in May 2008, I was able to re-coup all losses and reach a new high net worth by the end of 2009...without having a work income stream.
One other thing....I own plenty of US Government paper....however it is inflation adjusted, pretty much all purchased when the real rate portion was much higher.