Oversupply of Treasuries or V-shaped Recovery?

The 2Y note traded at over 1% yield today. I think most people would agree with me that chances of the Fed raising rates within 12 months are rather low. In order for the 2Y to yield an average of 1% over two years, assuming that T-bills will average 0.25% over the first year, we will need an average yield of 1.75% between 12 and 24 months. As the FOMC usually meets ten times in a year, this assumes a rate hike every meeting starting June 2010.

It looks like either the 2Y yield is implying a V-shaped recovery. This strikes me as a rather optimistic scenario, as the probability of the recovery being U or L shaped is high. The other possibility is that the 2Y yields are elevated as there simply aren't enough buyers out there to bring it in line with more realistic rate expectations.