hi doma,
the money in circulation needs to hold its value during the holding period. stability has value.
the market expressed its confidence in US paper when S&P downgraded the US credit rating. the flight to quality went straight into US treasuries. that tells you something important.
the money (plus the interest which accrues) in savings needs to be worth holding in a bank account in order to keep you holding it there. hence the interest element of the equation.
bear in mind that there's also a paradox in thriftiness. in fact, the economy as a whole generally does better when people use their money to consume and invest.
so the fed doesn't seek to make saving more appealing than these other options.
you've probably noticed that treasury rates usually run a little above inflation.
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