Are US Treasuries Still A Safe Asset?
Every time interest rates rise, the "bond bears" flood the media with commentary suggesting US Treasuries are no longer a "safe asset." The 30-year Treasury bond closed last Thursday at 5.17%. Meanwhile, the 10-year touched 4.71%, its highest print since January 2025, while Brent crude pushed above $100 as the Iran conflict escalated. Add a Fed meeting this week, and right on schedule, the Treasury safe asset debate reopened. A careful new paper from Hanno Lustig and three coauthors is now getting cited as proof that the world's reserve asset is finished. I've read the paper, and it is good…
The skinny
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