The Fed buys when no one else wants our debt…throw in another historic fact: yesterday the first time in history US Treasury Debt Instruments were downgraded by the big three, no longer AAA rated.
Keep in mind it gets worse, most Pension funds and Sovereign Wealth funds prohibit “ investment “ in anything but AAA….heading towards Junk?
no longer AAA rated.
Are there lots and lots and lots of choices besides newly downgraded US bonds for these picky institutional investors to choose fr ok m other than the US bonds? Are they historically as safe as US bonds and available in institutional purchase quantities? I’m th8nking they will change their standards before they wholesale abandon buying US securities.
I kind of doubt that. Most commercial debt is not AAA.