By Ann Saphir and Howard Schneider
JACKSON HOLE, Wyoming (Reuters) -No safer than a bund. Or a gilt. Or an OAT.
Long touted as hands-down the world’s “safe haven” securities, the behavior of U.S. Treasuries during and after the COVID-19 pandemic calls that label into question, suggesting they are little different from the debt issued by the likes of Germany, Britain, France, or even big corporations.
That’s the key finding of new research presented at the Kansas City Fed’s annual research conference in Jackson Hole, Wyoming. It examines a shift in investor behavior in that period that raises questions about the “exorbitant privilege” the U.S. government has long enjoyed to borrow broadly on the global market even as federal budget gaps grow ever wider.
It’s a timely question given growing deficits are seen as a near certainty regardless of who becomes the next U.S. president.
New York University’s Roberto Gomez-Cram, London Business…
