To supply the world’s risk-free asset, the country at the heart of the international monetary system has to run a current account deficit. In doing so, it becomes more indebted to foreigners until the risk-free asset ceases to be risk-free.A very interesting amount of tidbit and what our current picture looks like. The rates on bonds are just to low to accept virtually no amount of real return due to inflation. Better areas to place your hard earned capital IMO.
Why the Global Shortage of Safe Assets Matter
The Dollar Glut
Global Imbalances and the Triffin Dilemma
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