Economics focus

Safety thirst

A shortage of safe assets helps to explain why some government-bond yields are so low

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Readers' comments




To judge by the behavior of S&P before and since the crash, it is clear that it does not have a counter-cyclical bone in its body. The ratings agencies are nothing more than cheerleaders for the immediate conventional wisdom.

I find that discouraging.


"The poor in parts of Africa and India even pay deposit collectors a fee (ie, a negative interest rate)" - not only in the poorer parts of the world. Trying to pay Euro cash into a Euro account recently (in an non-Eurozone European country), I was told that I would incur a charge equivalent to the next ten years (pre-withholding tax) interest on this account. I decided to spend the money instead.


They don't make a mention of those that are the majority of the demand for these assets probably don't read standard and poor's assessments.

May I A Muse

Imagine what would happen if everyone were saving 10%
of their income for retirement instead of gorging on debt. The present demand for a safe place to park savings is just the tip of a very hypothetical iceberg.


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