Treasury Secretary Yellen defends criticism on rates and government funding

<ul><li><p>U.S. Treasury Secretary Janet Yellen responded to comments from billionaire Stanley Druckenmiller regarding her handling of low-interest rates.</p></li><li><p>Druckenmiller had criticized Yellen for not taking advantage of low-interest rates, suggesting that she could have issued longer-term bonds at higher yields.</p></li><li><p>Yellen emphasized that the U.S. Treasury has been lengthening the maturity of its portfolio, and the duration of the portfolio is among the longest. You</p></li><li><p>Druckenmiller's criticism was centered around the issuance of 2-year bonds at 15 basis points when he believed longer-term bonds could have been issued at higher yields, such as 10-year or 30-year bonds at 70 and 180 basis points, respectively.</p></li></ul><p>It's water under the dam but makes you wonder if they should have altered auction maturity structure when rates were lower.</p><p>The Strategic Petroleum Reserves is another "trade" that government has taken and did not jump in to replenish when prices moved into the $60-$70 area.</p>

This article was written by Greg Michalowski at www.forexlive.com.