Berlin, Germany (AHN) – In an auction Monday, Germany sold $4.96 billion of six-month bills that had a average yield of negative 0.0122 percent. The sale marked the first time on record that yields at a German debt auction moved into negative territory.

The sale basically means that investors agreed to pay the German government for the privilege of lending it money, and unlike most other short-term sovereign debt, in which investors expect to be repaid more then they lend, agreed to be paid slightly less.

Investors are willing to do so because they are fearful about the potential for large losses elsewhere. Several European countries have been stymied by years-long debt crises, leaving investors with few safe havens where they can park their money.

In recent months, other relatively safe countries, including the Netherlands and Switzerland, have sold debt with negative yields.

Regardless, demand for the German bonds sold Monday was strong. Investors bid for almost twice as many German bills as were available.

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