Yields on short-term government securities vary from just above zero (10 basis points for 3-month T-bills) to around 1% (88 basis points for a 2-year Treasury). Those are extraordinarily low rates by the standards of recent decades. But don’t confuse that with borrowing costs, or the demand or ability to borrow.

Finding loans is tough. Commercial and industrial lending continues to fall. In last year’s fourth quarter, C&I loans were down more than 5%, even though top-line GDP climbed at an annualized real 5.7% rate.

For consumers, the state of borrowing isn’t encouraging either. The St. Louis Fed recently crunched some numbers on so-called consumer loan spreads, defined as “the amount they would earn on a weighted average of funds held in M2 (which is essentially cash on hand or in easily accessible bank accounts).” The bottom line: the cost of funds remains high for consumers. In fact, the credit card spread “is higher today than at any time in the past decade—even when the federal funds rate was as high as 6.5 percent in 2000:Q4,” according to William Gavin at the St. Louis Fed.

On the other hand, perhaps this is something of a moot point. Joe Sixpack seems intent on saving more these days. The personal savings rate (measured as a % of disposable personal income) was 4.6% in last year’s fourth quarter, more than double the level in 2008’s third quarter. That’s hardly a surprise, given the current economic backdrop and the general need to repair household balance sheets. But to the extent that economic recovery depends on a robust increase in consumer spending, there’s reason to stay cautious (as if we needed another reason).