.. in the fiscal year that just ended in October, Colas writes in a recent note to clients, the U.S. Bureau of Engraving and Printing cranked out 3 billion, $100 notes.

"That's substantially higher than the run-rate of the past couple of years," Colas points out, and 50% more than the 2 billion $1 bills that were inked up. "It's actually a record amount of production," he says.

All of which begs the question, why?

This is pretty interesting in that the Fed has otherwise been pretty successful in keeping "cash from hitting the streets" in its deflation-fighting. However, a glaring consequence of Treasuries yielding nothing is that there's no reason to hold them instead of cold, hard cash. In fact, they aren't subject to interest rate risk at all (and to a lesser extent, default risk), so for wealth-preservation, $100 bills make more sense than Treasury notes today.

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