Bailout

Banks are buying Treasuries like mad it seems due to a dearth of corporate bonds and restrained growth of their loan portfolios. Sounds like a good time to issue debt if you are a top rated corporate. Also, this is a result of banks being defensive, with substantial growth in deposits net of loans since they are restraining their loan growth. But with treasury returns so low, one has to imagine that at some point banks switch to being more aggressive on the loan growth front once they have more confidence in the value of their balance sheets and deposits keep rolling in due to Americans finally saving more. All-in-all, to me this a good sign that our financial system is healing itself.