The most recent flare up of the turbulence has however lead to significantly increased demand for short term government securities leading to lower interest rates for the German T-bills. Prior to the recent turbulence in September the search for safety drove down both the T-bill and the highest rated commercial paper yield.
Lately the status of the commercial paper programs as a safe heaven has eroded, as the CP-markets have frozen (see slide 6). Outstanding amounts of asset backed commercial papers took a significant dive at the outset of the turbulence in 2007 (see slide 7). Recently the outstandings of commercial papers for financial issuers have been declining.