"The yield on the two-year Treasury dropped by 37 basis points, while the 30-year bond declined by only 17 basis points during April."

The 10-year Treasury yield is down to 4.78 percent, while the yield on two-year Treasuries is at 3.49 percent.

If you moved out of two-year Treasuries into two-year German notes, you would pick up 60 basis points.

Suddenly, banks could make good money by taking in deposits and lending them to Uncle Sam by buying two-year or three-year Treasuries.

I'm making the bet that a portfolio of companies trading at reasonable prices is going to outperform two-year Treasuries.

A buyer of that two-year Treasury will, of course, earn 5 percent a year for the next two years, barring only a Treasury default.

And the price of gold fell to $330 and yields on two-year Treasuries went down to 3.73 percent.

Then I engineered a steep yield curve so that the banks could borrow from depositors cheaply and make good money on two-year Treasuries.

The two-year Treasury yielded 2.82 percent, down from 3.5 percent before the terrorist attacks.

Yields on two-year Treasuries have risen to 2.69 percent from 1.46 in March.