US treasury bills are issued by the government, when it executes its open market operations. In terms of investments the US Treasury Bills are rated right on top of all debt instruments by the best credit rating institutions such as Standard and Poor and Moodys. The answer lies in the fact that these bills do not have a relation with the governments, which is in power. These bills are issued by the Treasury Department, which is similar to, say the Reserve Bank of India.
The Bureau of the Public Department is given the responsibility of executing sales operations. The economic terminology calls them”Treasuries”. They are supposed to be implements which serve the purpose of financing debts. Usually the securities are of four kinds. They are Bills, Notes, Bonds, and the Savings Bonds. These securities are usually very flexible, though there is an exception in the form of Savings Bonds. They are very popular in the secondary market, as is evident from the amount of sales.
The T-Bills' maturity period is, usually a maximum of a year. The periods may also be in denominations of one, three or six. They are priced at a thousand dollars each, with the upper most limit being five million.
Before they are matured, they do not pay any interest, whatsoever, to the buyer. Since they are sold at a price lesser than their actual worth , the difference in these prices goes a long way in determining the profits.
These bills are provided to their holders on Fridays, after the thoroughly fierce auctions on Wednesdays. The orders are supposed to be placed with the Treasury Direct wing of the US Treasury, before thirty minutes past eleven, at the most, on Mondays. The Bills that have matured can be exchanged for cash on Thursdays. Financial companies are the biggest clients of these Bills. Now that the Treasury Direct is here, it is possible for individuals to buy bills on-line. This means that they can draw funds, put them in their personal bank accounts. They have the added incentive of being able to earn extra money on their savings.
The US government has taken it upon itself to sell these T-Bills directly. Thus they may be categorized as securities, which are sold in the open financial market. Their biggest support comes from the fact that they have the direct backing of the national government itself in the United States.