Finance consistently discusses the risk free rate of return. This risk free rate is often tied to US Treasuries but whether we like it or not there is no risk free rate of return We are in a new era where there is mor risk everywhere. This is the new reality. Treasuries can have a default. If there is not an outright default, Treasuries will have higher risk from variation in expected inflation.
We also may be in a period of global risk because the risk free rate asset also served as the reserve currency. The public good aspect of Treasuries is now gone. We do not know what the effect of this change in the risk free rate will be in the longer or short run because it is too early to measure what are the alternatives. Nevertheless, the impact may be a shrinking of trade and capital flows because the risk of trafficing in dollars is now higher than before.
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